News / Shipping lines 'ripping-off' shippers with ETS 'profiteering', claims lobby group

© Siarhei Yamkavoi

Four top shipping lines – Maersk, MSC, Hapag-Lloyd and CMA CGM – are named in a Transport & Environment (T&E) “profiteering” claim that millions have been generated via overcharging for EU ETS.

All four lines declined this morning’s invitation by The Loadstar to refute claims of average voyage ‘surcharge profits’ of €60,000 ($65,000) for Maersk, €23,000 for Hapag Lloyd, €25,000 for MSC, and €14,000 for CMA CGM.

“The data has been thoroughly peer-reviewed,” said T&E spokesperson Sam Hargreaves. “We can only make an assumption, based on the evidence we have, that their intent was to rip off.”

In the highest example of a single voyage, a Maersk vessel travelling from China to Germany, the carrier could make €325,000 in surcharge profits, T&E calculated.

T&E shipping policy manager Jacob Armstrong told The Loadstar the given ETS surcharges were contingent on an overestimation of the carrier’s carbon price of €90/tonne (or €80/tonne in the case of CMA CGM), much higher than the €60/tonne actual current price.

“That’s a third less,” said Mr Armstrong.

The first announcements of ETS surcharges to be applied came in 2022 from MSC and Maersk.

“They have known for a very long time how this is going to play out,” said Mr Armstrong. “And these are multinationals that have vast experience in surcharges, not small family-run companies doing the numbers on the back of a napkin.

“The thing with ETS is you can buy on the spot market whenever you like. Commodity traders within these companies will have waited until the price is sufficiently low to buy more. They know how to hedge, they know how to operate in these complex financial scenarios.

“Our sample is representative. We’ve analysed 565 voyages, 86% of those are [ETS] profit-making, so the trend is clear; it’s not just the outliers.”

The single biggest disruptor to normal ship operations so far this year is the Red Sea crisis, which has affected ETS calculations by causing the majority of ship traffic to re-route round the Cape of Good Hope. Mr Armstrong said T&E had considered whether to factor this into its research.

“When we were doing it back in January, we kind of expected a solution [to the crisis] quite soon, which is why we did not factor in the Red Sea analysis.

“The point is that when voyages go back to normal, this will be the case. [The carriers] have all announced Red Sea surcharges, which account for operational costs, fuel costs, insurance – and would also take into account added ETS costs.”

But OceanScore analytics managing director Albrecht Grell defended the carriers: “ETS increases the cost of shipping cargo to, from and within Europe. It is intended that owners pass this cost on to operators, and that operators add this to the cost of transporting cargo.

“We see a lot of different ways of how this cost is passed on and we see significant differences, too. But what we see as well is that the surcharges (when referring to the container trade) have changed over time, reflecting intense competition in the segment.

“It’s not ETS that defines the price of transport – it’s a combination of overall costs, demand and supply,” he told The Loadstar.