It could go for about $10,000. Bunkering at Sea is the first integrated independent web-based platform, to provide innovative network solutions for bunkering, through several types of electronic auctions. Bunkering at Sea. You may find tools online for calculating such cost. Since the laws impacting the calculation of the bunker charge will vary, it is often a good idea to check with shipping officers in the country of origin regarding the current status of regulations having to do with this type of charge. It is designed to facilitate day-to-day bunkering business & Long time Bunker contracts while providing flexibility and the ability to manage multiple orders or offers simultaneously. As such decide to purchase a Platts Singapore High Sulfur fuel oil 380 CST swap at the current market price of $243/MT (approximately $38.26/BBL based on a conversion factor of 1 MT = 6.35 BBLs). Amazon Doesn't Want You to Know About This Plugin. trivia, research, and writing by becoming a full-time freelance writer. Bunkering is the action of supplying a ship with bunkers. As an example, let's assume that you are a shipping company seeking to hedge your Asian bunker fuel price exposure for the month of September. The platform offers customized statistical analysis tools to support smart business decisions for both ends of the market. The nature of the goods, and any special precautions that must be taken in handling and storing the goods, will also have an influence on the final amount of the charges. The charge covers extra bunker cost, insurance coverage, and additional security measures. statistical analysis tools to support smart business decisions for both ends of the market. In recent years, the bunker fuel costs have increased considerably to more than half of a shipping company's total operation costs. Oil prices are quite volatile, and in order to counter the fluctuations in oil prices, the shipping lines charge Bunker Adjustment Factor (BAF) as a surcharge on top of the ocean freight.. ship's fuel) against a base level incorporated in the freight rate. BAF is based on Twenty-foot Equivalent Unit (TEU) and varies according to the trade routes. to maximize bunker value for money through new purchasing initiatives and supplier relations. Then, there excavation and installation, becausebunkers are buried at least 6-feet underground. Responsibilities for actions that affect bunker costs are typically scattered throughout an organization, both on shore and at sea, and the various teams involved often resist new ways of tackling familiar tasks. Calculation of the bunker charge will often include consideration of several different variables. The precipitous drop in bunker prices has led to increased savings for shipowners. variety of print and online publications, including wiseGEEK, and his work has also appeared in poetry collections, In addition, three shipping giants, Maersk, MSC, and CMA CGM, have announced introduction of Emergency Bunker Surcharges, due to the increasing fuel costs. The charge basically has to do with the actual loading of the goods into the hold or bunker of the transport vessel, and is considered to cover the costs of not only the loading but also the storage of the goods in the bunker for the duration of the trip. The shipping lines have quoted rising fuel costs as justification for the emergency surcharge, with 2M partners Maersk and MSC, and Hapag-Lloyd claiming that the high bunker prices are no longer sustainable. Doing so helps buyers to have some idea of what to expect and can consider this element of the purchase and shipment along with other factors in order to decide if the purchase is really the best option. The major sea routes have many points where there are bunkering barges providing bunkering facility. Also known as: Bunker, Bunkers. The paper also includes a cost model to simulate the impact of bunker cost changes on the operational costs of liner services. The platform: Saves time through simplified and transparent procedures, Securing your competitive advantage with Bunkering at Sea. The fee will be applied to bookings that are from, to or transited through the affected areas. Bunker Adjustment Factor Tips: Smaller charges like this can add confusion, so smaller customers usually receive or should ask for, an all-inclusive port to port charge. Supply chain transparency with the aid of an independent digital platform, boosts healthy competition and reduces the risk of being charged higher commissions, other than the necessary fees for bunkering fuel. The term "Bunker" refers to the fuel that is used to operate ships. Find out more about the efficiencies of our platform today. A bunker charge is a type of sea freight charge that is normally imposed with any type of international shipping of goods from one country to the next. The emergency bunker surcharge has been introduced by many carriers. Achieving bunker cost reductions can be difficult and complex with internal organizational dynamics often hindering cost-reduction initiatives. The upcoming IMO 2020 environmental regulations will further increase bunker costs, resulting to tighter credit lines and shrinking profit margins for ship owners and ship managing companies. Boston Consulting Group: Bunkering Optimization The strategic BCG bunkering optimization framework comprises of ten elements to be considered, including: Planning, Procurement, Voyage Execution, Charter Value, Technical Efficiency and Fleet Optimization. comprises of ten elements to be considered, including: , Voyage Execution, Charter Value, Technical Efficiency and Fleet Optimization. Responsibilities for actions that affect bunker costs are typically scattered throughout an organization, both on shore and at sea, and the various teams involved often resist new ways of tackling familiar tasks. The distance from the port of origin to the port of destination will come into play, since traveling that distance does involve the consumption of fuel. Learn about a little known plugin that tells you if you're getting the best price on Amazon. devotional anthologies, and several newspapers. As bunker fuel prices are quite volatile, the shipping lines charge a fee called "Bunker Adjustment Factor (BAF)" to cover the fluctuations in global bunker costs. In order for shipping companies to achieve Bunker cost efficiency, the report recommends: An end to end bunkering optimization strategy to achieve bunkering cost savings and maximize value creation, as well as the careful evaluation of each step of current bunker processes. Ship & Bunker - News, Exclusive Features, Bunker Price Indications - The World's Most Read Publication for the Marine Fuels Industry to support optimized end to end bunker processes, to monitor accountabilities and continuous improvement, e-auctions platform offers an innovative smart Bunker. The most commonly used type is residual fuel oil bunker or Bunker C.. Grades of Bunker fuel. within a company & strengthening competitive advantage in a volatile market. In such an industry fuel could be considered one of the most critical costs where the fuel may be as high as 50% of the carriers cost. A bunker charge is a type of sea freight charge that is normally imposed with any type of international shipping of goods from one country to the next. In the current challenging markets, shipping companies must focus on reducing their bunker costs, the Boston Consulting Group (BCG) has said.. Others estimate extra costs for container shipping alone will be $35 billion to $40 billion. In the midst of declining oil costs, CNBC reports that “The normal day by day fuel cost to work a VLCC has tumbled from over $75,000 to under $18,000.” Registered members have access to bunkering transaction history with real time prices for comparison, future reference and record tracking. The charge covers extra bunker cost (due to longer routing and/or faster sailing), insurance coverage, and additional security measures. It is a transparent, Bunkering Fuel Sales Platform that offers cost-efficient solutions and business intelligence tools, connecting all quality players in the market. This particular aspect of the rationale for the bunker charge is known as a fuel adjustment factor. Find out more about the efficiencies of our platform today. Avoiding the immediate cost of technology or service provision may be viewed by shipping companies as an opportunity to cut costs. The charge basically has to do with the actual loading of the goods into the hold or bunker of the transport vessel, and is considered to cover the costs of not only the loading but also the storage of the goods in the bunker for the duration of the trip. Namely, fuel prices have increased by more that 30% this year, and almost 70% since last June. INTRODUCTION For shipping companies a very large part of the variable operating cost are for bunkers (fuel), for the vessels. It was imposed to make up for the extra charges incurred during the shipment of goods. A national or international shipping organization can also decide to use an emergency bunker surcharge as well. A bunker surcharge, also known as bunker adjustment factor (BAF), is the charge shipper’s incur to compensate for fluctuating fuel prices and is typically in addition to other surcharges and fees added to the freight costs. Bunker Purchasing with Contracts Federico Farina, Peter Neergaard Jensen, Christian E. M. Plum and David Pisinger I. offers a transparent digital service for cost efficient trading solutions; by freeing up the commodity from the traditional advantage of intermediates in controlling market information and assets. 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