Box ship scrubbers: ‘preparing for the big boom’

2020 is gearing up to see a boom in container ship orders despite delays in scrubber installations in shipyards.

As Yara Marine Technologies chief executive Thomas Koniordos predicts “The next big wave of scrubbers is coming.”

Yara Marine Technologies’ technical sales manager Anders Sørheim tells Container Shipping & Trade “Operators did not want to make a decision until they had to, and this led to long delivery times. There will not be the same issues as last year, we have identified all the bottlenecks in capacity and have commissioning engineers so we are ready and prepared for the big boom.”

Other solutions providers agree. Clean Marine also expects a boost in scrubber orders. Clean Marine PR and marketing manager Camilla Knappskog says “We expect a second wave of scrubber orders now the technology and fuel price spread assumptions have been confirmed.”

Clean Marine has more than 250 scrubbers on its orderbook and completed more than 70% in 2019.

She adds “Current deliveries are still part of the first wave of orders, of which some yard-stays have been postponed by shipowners due to the high tanker rates the market is currently seeing. We are waiting for the second wave of orders to kick in soon. Given that fuel spreads are high, and expected to be high in the coming years, it is financially beneficial for at least 20-30,000 ships in the market to install scrubbers.”

Clean Marine experienced high demand for scrubbers from shipowners wanting to be compliant before IMO2020 kicked in. Ms Knappskog says “Now that we have entered into January 2020, we see a new upsurge in interest for scrubbers as many shipowners have tried and tested the products, have compared producers and scrubbers versus VLSFO and see the benefits of installing a scrubber on their fleet. Moreover, we believe the current cost savings that scrubber-fitted vessels benefit from compared to vessels running on VLSFO will act as a catalyst for shipowners wanting to install scrubbers.”

The focus on finishing container ship scrubber retrofits means that not much additional activity in terms of new orders is being seen, says CR Ocean Engineering (CROE) Nicholas Confuorto.

He explains “The industry is not seeing much additional activity except for finishing projects – shipyards are very busy with retrofits and there are installation delays because of this. Many of these projects have been pushed into 2020 when they wanted to finish in 2019 and these are very hectic times to get the projects finished. Therefore, there is not much activity in terms of new projects.”

But Mr Confuorto expects much more activity soon. “Given the pricing differentials, I think there is no question that scrubbers are the best option. There is currently a US$300 price differential (between VLSFO and HSFO), up US$100 since a month ago, so a real jump. It is a steep incline and I believe it will get even higher than that in the next couple of months.

“Container ships use a lot of fuel, that’s why I am hoping these projects will be coming back strongly once current projects are finished.”

He says the scrubber container market mainly consists of retrofits, making up 90% of the market. CROE itself has 30 container ships on its books, including both ultra large container ships and feeders. Many are already commissioned but some are still waiting to finish installation. All are retrofits.

Speaking about CROE scrubber developments, Mr Confuorto says “Our focus over several months has been to simplify things for the customer. Some ships need a different shape of scrubber tower to fit better.” To this end CROE has four different designs.

Concerns about availability and compliance issues of low sulphur fuel is helping to propel scrubbers as a strong alternative, Pacific Green Technologies vice president marine direct sales Frode Helland-Evebo says. He expects to see a positive year ahead for scrubber sales within the box ship market.

“I think this year will be big, like 2018.”

Pacific Green is targeting the 8-14,000-TEU ship market for scrubbers and is working on several projects within this area. He adds “We expect more as there is an interesting scrubber case for container ships as they burn a lot of fuel.”

New shipyards ease bottlenecks

The scrubber container ship market has suffered delays in retrofits due to bottlenecks – but new shipyard capacity is easing the load, says Cleanship Solutions business development manager Stuart McKenna.

Cleanship Solutions facilitates the design and engineering of scrubbers. Mr McKenna says “We have done a lot of container ships in 2019. The first move for container ships came in 2018, and in 2019, more container ship operators wanted to make sure their fleets were ready for any eventuality. They installed scrubbers on a percentage of their fleet to spread the risk and secure supply of fuel.”

Speaking about the container ship retrofit market, he says “There have been a few bottlenecks as there has been a struggle for design engineering capacity. There is a squeeze on the skillset that companies including Cleanship offer, and people are working to get retrofits completed as quickly as possible. Shipyards underestimated the time it takes to install a scrubber, meaning there are backlogs, with Chinese yards quite full and not going as quickly as hoped.”

As well as Chinese yards trying to work as quickly as possible, he said bottlenecks were easing as other locations are now fitting scrubbers, such as Turkey and other markets which wouldn’t normally carry out scrubber retrofits. Mr McKenna says “Turkey has good availability for retrofits, out of China it is the second most popular place. However, it is a learning curve for yards as it is quite a complicated job.”

Looking ahead, Mr McKenna says “I think 2020, with the current fuel spread, is going to be an exciting year and for container ships particularly – one of those markets that if you don’t have a scrubber, it will be hard to compete.”