Cargill Says States Should Consider Ban on Older Commodity Ships

Cargill Inc., the world’s largest charterer of commodity carriers, said governments should consider banning older vessels to help curb pollution.

International shipping accounts for about 2.7 percent of carbon dioxide emissions, the United Nations said in a report two years ago. About 35 percent of the fleet of vessels hauling dry bulk commodities including iron ore and coal is more than 15 years old, according to Clarkson Research Services Ltd., a unit of the world’s largest shipbroker.

“Setting certain legislation around vessels’ age could help and that’s something for authorities to look at,” Roger Janson, president of Cargill’s ocean transportation unit, said in an interview in London yesterday. Some “very old” ships with high fuel consumption are concentrated on routes including China’s coastal coal trade, he said.

About 90 percent of global trade moves by sea, according to the Round Table of International Shipping Associations. The UN’s International Maritime Organization agreed on mandatory rules covering the energy-efficiency of new vessels in July. It also passed guidelines for reducing emissions from existing ships. There is already an international ban being phased in for single-hulled oil tankers, deemed to be “more accident prone,” the European Union said in 2003.

Cargill, the largest closely held company in the U.S., would support similar types of legislation in dry bulk shipping, Janson said. The Minneapolis, Minnesota-based company ships 185 million metric tons of dry bulk commodities a year and operates more than 350 vessels at any one time, according to its website.

International shipping is lagging behind the car and aircraft industries in improving efficiency, according to the Sustainable Shipping Initiative. Cargill is one of 15 signatories to the initiative, which is developing a 30-year plan to cut emissions, improve designs and toughen laws.

To contact the reporter on this story: Michelle Wiese Bockmann in London at mwiesebockma@bloomberg.net

To contact the editor responsible for this story: Alaric Nightingale at anightingal1@bloomberg.net

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