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(Bloomberg) -- Commodity trading behemoth Cargill Inc. and tanker owner Hafnia Ltd. are forming a major new ship-fuel supplier, at a time when the maritime industry is bracing for emissions-cutting rules.
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The Seascale Energy joint venture will combine Cargill’s Pure Marine Fuels business with Hafnia Bunker Alliance, which last year procured and delivered about 7.5 million tons of marine fuel between them. The new venture will initially handle similar volumes, and aims to increase the amount in future.
Vessels used more than 1 billion tons of fuel between 2019 and 2023, according to the International Maritime Organization, the industry’s global regulator. Over the coming years, new rules are set to transform the market that still largely depends on oil-derived products. The European Union is pushing shippers toward cleaner options and new, global measures are set to be agreed later this year.
Seascale Energy plans to deliver access to sustainable fuel innovations and expects to secure more competitive pricing, the companies said in a statement.
In 2024, the cost of a popular marine fuel called VLSFO averaged about $550 a ton in Rotterdam. At that price, supplies of 7.5 million tons would be worth more than $4 billion.
“As an owner and as a consumer of bunker fuels, you’re looking” into a very complex procurement situation, Hafnia Chief Executive Officer Mikael Skov said. Seascale Energy will be “one of the largest services of its kind, led by two large-scale fuel users.”
The joint venture is subject to regulatory approval and is expected to become operational in the second quarter.
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