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Industry Updates

New Shipping Rules Will Impact Global Supply Chains


Oceangoing supply chains will be impacted by a new International Maritime Organization (IMO) environmental regulation that takes effect in the new year.

IMO 2020 seeks to reduce emissions by encouraging ships to use cleaner bunker fuel, install onboard scrubbers to reduce sulfur dioxide releases or switch to an alternative marine fuel, as explained in a recent column in GreenBiz.com.

Noncompliance could result in fines, damaged reputations and the detaining of ships and crews during investigations. The column noted that the third consequence could result in “a huge cost to the supply chain, where each party tries to run lean, just-in-time inventory. A detained ship means that product either was not delivered or picked up according to schedule. That imposes other delays downstream in the process, affecting overall inventory and increasing costs unnecessarily.”