Recently, two South Korean corporate giants, Lotte and Hanwha Group, have announced their entry into the shipping industry, triggering strong reactions in the industry. It is reported that Lotte Global Logistics, a subsidiary of Lotte, is planning to introduce two ammonia carriers with the aim of carrying out more environmentally friendly maritime transport operations. Hanwha Group, not to be outdone, plans to get involved in the transport of environmentally friendly fuels through its newly established shipping company.
This move by Lotte is not an empty one. Back in May 2021, Lotte Global Logistics, a subsidiary of the company, signed a memorandum of understanding (MOU) on green ammonia marine transport with a number of companies, including Lotte Fine Chemicals, HMM, POSCO, and Korea Classification Society.
Lotte Fine Chemical, as Asia's largest ammonia distributor, imports, stores and supplies about 900,000 tonnes of ammonia annually, accounting for about 70% of the domestic ammonia distribution market. The introduction of the ammonia propulsion vessel not only demonstrates Lotte's commitment to environmental protection, but also signals a more important role in the shipping industry.
Meanwhile, Hanwha Group's initiative has also attracted a lot of attention. Hanwha has established Hanwha Shipping, which aims to showcase its advanced shipping capabilities through environmentally-friendly and digitally-enabled ships. It is widely believed in the industry that Hanwha Group may transport environmentally friendly fuels, such as low-carbon ammonia, through this newly established shipping company. The move coincides with Hanwha Group's aggressive presence in the environmental energy sector.
However, the two giants' plans to enter the shipping industry have not been universally welcomed by the Korean shipping industry. Although eco-fuels such as methanol, ammonia and hydrogen are not included in bulk cargoes under current regulations, so big companies can get into the eco-fuel transport business. However, the shipping industry is concerned that once these large companies with huge capital and market power start to get involved in maritime shipping, the existing shipping companies may be at risk of being eliminated.
Against this backdrop, the Korean shipping industry has made a proposal to the Korean Ministry of Maritime Affairs and Fisheries to limit the entry of large companies by treating eco-fuels as oversized cargo. However, it remains to be seen whether this proposal will be adopted and how Lotte's and Hanwha's shipping plans will affect the shipping industry as a whole.
https://www.cnss.com.cn/html/hyqy/20240617/353785.html
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