VLCCs, Boxships to Benefit from Extended Suez Canal Cuts
In order to encourage very large crude carriers (VLCCs) to opt for the Suez Canal rather than sail around the Cape of Good Hope, the Suez Canal Authority decided to extend the toll benefits for the sector until the end of the year.
The arrangement relates to VLCCs coming from the Arabian Gulf or Caribbean Zone on a round trip and transiting the canal after discharging part of their cargo in the SUMED line.
Specifically, the arrangement for VLCCs of over 250,000 dwt was introduced in June 2016 for an experimental period of 6 months and extended until the end of 2017.
Under the scheme, any VLCC on its return trip from the north entrance is to pay a lump sum of USD 180,000, including extra charges levied for tugs, arrival after limit time and booking in the convoy.
A 45 pct toll cut is being provided for crude oil tankers coming from ports of the US Gulf and the Caribbean area and heading to the ports west of the Indian subcontinent starting from Karachi en route to Cochin and 75 pct reduction for those heading to the ports located east of Cochin.
Crude oil tankers coming from Latin American ports, starting from Columbia and heading west of the Indian subcontinent starting from Karachi and going to Cochin shall be granted 65 pct toll discount, while those heading east of Cochin will benefit from a 75 pct cut.
Separately, the reduction of rates offered to containerships coming from Eastern American ports and heading to South and South-East Asian ports will be kept in force until the end of June 2018.
Specifically, boxships coming from the Port of Norfolk and its northern ports en route to the ports of Port Kelang and its eastern ports will be granted a reduction of 45 pct.
Containerships coming from ports south of Port of Norfolk heading to ports of Port Kelang and its eastern ports will be granted a reduction of 65 pct.
Additionally, vessels coming from ports south of Port of Norfolk destined for Port of Colombo and its eastern ports located just up to Port of Port Kelang will get a reduction of 55 pct.
The extension comes on the back of longer duration of toll cuts offered to dry bulk vessels by the canal authority.