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Pot, kettle, black - RMT on the shipping industry making 'blatantly alarmist noises'

Pot, kettle, black - RMT on the shipping industry making 'blatantly alarmist noises'
Last week the UK's Union of Rail, Maritime and Transport Workers (RMT) criticised the shipping industry's "alarmist" statements on sulphur regulations.

The union stated that "blatantly alarmist noises" from the industry "threaten to destabilise the already damaged sector and... pose a renewed threat to seafarers jobs and training".

The union argues that industry has had time to prepare given that the deadline has been known since 2008, that the impact of sulphur regulations is eased by lower fuel costs due to the current slump in the oil price, and that the industry has no basis for fare hikes and route cuts given "global sea trade is set to double over the next twenty years".

Six years have passed since the deadline announcement, during which the global financial crisis struck, shipping markets collapsed and credit became difficult to source for shipowners and equipment manufacturers alike. Sulphur abatement technologies have developed significantly since the deadline was revealed, but hesitance around the use of scrubbers still remains given the technology's relative infancy and the investment required versus the risk involved.

A doubling of sea trade is no indicator of guaranteed future profits, given the current state of the market. In 2008-2012 the top 20 container lines lost an average of $16 for every container they moved, sustaining average annual losses of $1.3bn apiece. Considering the RMT's UK base the statistic is especially odd, given that a doubling of world seaborne trade is unlikely to see the lion's share of that growth focussed around established markets such as Europe.

There has also been continued concern over the availability of low sulphur fuels once the rules come into force. The concern is so real the the IMO is undertaking a study into the availability of fuels before it sets in stone the date of the next lowering of the sulphur limit.

RMT national secretary for shipping Steve Todd said: “RMT cannot stand by and allow the shipping industry a free run at our members’ jobs on ferries and at ports in the North Sea and Channel. Leaving these alarmist statements to the eleventh hour is a crude ploy that causes unnecessary instability in the industry."

“In addition to the GBP725m ($1.1bn) tonnage tax break the shipping industry has enjoyed since 2008-09, the EU gave ferry companies in the UK nearly EUR30m ($37.1m) in July specifically to help with costs converting vessels to low sulphur fuel," he added. For perspective, total equipment and installation costs for a scrubber on a single 6MW engine are around EUR3m.

If the aim of the RMT is to safeguard work and conditions for its members, it could be worth taking into account affairs in mainland Europe when assessing the ability of shipping lines to absorb fresh costs. Reederei NSB recently announced that despite discussions with the German government and union ver.di, it will be leaving the German flag to ensure it can remain in business, with the loss of 486 EU seafarer jobs. NSB's warning earlier this year that it might be forced to out-flag was criticised by RMT as "going for the cheapskate option" and "a race to the bottom.”