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  • FOR 2020, FORECASTS HAVE GONE FROM A 12 MILLION TONS PRE-COVID DEFICIT TO A 56 MILLION TONS POST-COVID SURPLUS IN INTERNATIONAL STEAM COAL SUPPLY, MAINLY DUE TO LOWER IMPORTS IN CHINA AND INDIA - ASSOCARBONI
  • SEABORNE WORLD COAL TRADE CLOSED 2019 POSITIVELY WITH A 2% ANNUAL GROWTH AND CONFIRMING A GROWING TREND LEADING TO A 50% INCREASE IN VOLUMES IN 10 YEARS - ASSOCARBONI
  • EUROPE GENERATES ELECTRICITY MAINLY FROM COAL (18,2%) AND FROM NUCLEAR (25,5%), CUTTING THE COSTS OF ELECTRICITY BILLS BY AN AVERAGE 30% - ASSOCARBONI
  • COAL CONFIRMED ITS LEADERSHIP AS LEADING FUEL FOR ELECTRICITY GENERATION ALSO IN 2019, ACCOUNTING FOR 38% OF OVERALL PRODUCTION AND CLOSING 2019 WITH A 2% INCREASE IN SEABORNE COAL TRADE (1.290 MILLION TONS) - ASSOCARBONI
  • VIETNAM, INDIA, CHINA AND PHILIPPINES ARE THE COUNTRIES THAT CONTRIBUTED THE MOST TO THE GROWTH IN COAL VOLUMES DURING 2019, ACHIEVING RECORD RESULTS IN TERMS OF IMPORT - ASSOCARBONI
  • FOR 2021 EXPECTED AN INCREASE IN SEABORNE COAL TRADE, DRIVEN BY IMPORTS OF NEW EMERGING ASIAN ECONOMIES INCLUDING PAKISTAN, BANGLADESH, PHILIPPINES, MALAYSIA AND VIETNAM - ASSOCARBONI
  • CONFIRMED THE GROWTH TREND THAT IN THE LAST TEN YEARS HAS LED TO A 50% INCREASE IN THE COAL MARKETED VOLUMES - ASSOCARBONI
  • AUGUST 2020 INDONESIAN COAL PRICE REFERENCE FOR EXPORTS AND DOMESTIC BUYERS INCLUDING POWER PRODUCERS FIXED AT US$ 50.34 A TON

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Sunday, 02 February 20
NOVEL CORONAVIRUS OUTBREAK IN CHINA - STANDARD CLUB
Standard ClubMembers will be aware of the recent novel coronavirus outbreak in China, which has now been declared a global emergency by the World Health Organisation.
 
Although the following information is believed to be accurate at the time of writing, the situation is evolving rapidly and new measures are frequently being put into place. Members are advised to always check with their agents and the local correspondents (contact details can be found on the club’s website) well in advance of any call to a country affected by the virus, particularly ports in China.
 
The Standard Club is guided by the views and recommendations issued by the World Heath Organisation (WHO) in respect of this outbreak and advises members to remain vigilant and fully updated with regards to the spread of the virus. More information on the virus itself and developing situation are available from the WHO website.
 
Background information and general advice
The WHO was first made aware of several cases of suspected pneumonia in Wuhan City, in the Hubei Province of China, on 31 December 2019. There was heightened concern as the cases were identified as a previously unknown virus. In the first week of January 2020 the new virus was identified as the novel coronavirus, which is a family of viruses that include the common cold, and viruses such as SARS and MERS. This new virus has temporarily been named ‘2019-nCoV.’
 
The latest situation report from the WHO, estimates of the incubation period of the virus ranges from two to ten days, and these estimates will be refined as more data become available. Understanding this incubation period and the period during which the virus can be transmitted between individuals is critical for control efforts.
 
During previous outbreaks of similar viruses (Middle-East Respiratory Syndrome (MERS) and Severe Acute Respiratory Syndrome (SARS)), human to human transmission occurred through droplets, contact and fomites, suggesting that the transmission mode of this virus may be similar.
 
At the time of publication countries where there are confirmed cases of the virus (excluding China) are Japan, Republic of Korea, Vietnam, Singapore, Australia, Malaysia, Thailand, Nepal, USA, Canada, France and the United Kingdom.
 
Advice to shipowners and recommendations
The International Chamber of Shipping (ICS), has issued a statement advising its membership to take steps that limit the spread of the virus. The instructions reflect advice given from the WHO, which stated that if certain measures are taken, there should be no ‘unnecessary restrictions of international traffic’, meaning ports and global shipping can continue to operate.
 
Advice provided to shipowners highlights the need for:
 
Exit screening at ports in the affected areas to detect symptomatic travelers and prevent the exportation of the disease. This includes checking for signs and symptoms and keeping confirmed cases under isolation and treatment.
Implementing health information campaigns to raise awareness on how to receive assistance if someone is showing symptoms.
Collaborating with public health authorities for case management on board ships, should a traveler with symptoms be detected.
More information is available here.
 
The International Seafarers’ Welfare and Assistance Network (ISWAN) has circulated advice from the International Maritime Health Association (IMHA) which advises people to check the advice and recommendations issued by local authorities and stay up to date on the latest advice from WHO. The circular from ISWAN includes the following:
 
How to protect yourself from getting infected with the virus
• Frequently clean hands by using alcohol-based hand rub or soap and water
• When coughing and sneezing cover mouth and nose with flexed elbow or tissue – throw tissue away immediately and wash hands
• Avoid close contact with anyone who has fever and cough
• If you have fever, cough and difficulty breathing, seek medical care early and share previous travel history with your health care provide
• When visiting markets in areas currently experiencing cases of novel coronavirus, avoid direct unprotected contact with live animals and surfaces in contact with animals
• The consumption of raw or undercooked animal products should be avoided. Raw meat, milk or animal organs should be handled with care, to avoid cross-contamination with uncooked foods, as per good food safety practices.
 
Specific advice to shipping crew and companies (as of January 26, 2020)
• Do not restrict embarkation/disembarkation of seafarers in non-affected ports
• Do not restrict necessary ship visits by port agents, chaplains, service personnel and others
• Do not visit food markets in China. Avoid provision of fish and poultry in China
• Do not consume raw eggs, milk, meat
• For galley: observe strict food hygiene to avoid cross-contamination
• Store facial protection for all crew (5 pieces per person)
• Provide influenza vaccination, alcohol-based hand rub and facial protection to ship inspector and other company employees who travel to China
• If a person on board falls sick AND has been travelling to affected areas 2-12 days before embarkation, the person must stay in his cabin. Consult a medical doctor in the next port
• If a sick person is on board of the ship, fill the Maritime Declaration of Health and notify port authority
 
Infectious Disease Clause
Following the outbreak of Ebola, BIMCO in conjunction with representatives of the IG group developed clauses for time and voyage charterparties specifically to deal with infectious or contagious diseases. These clauses remain relevant in the context of coronavirus and provide owners with express rights to refuse orders to a port or place where there is a risk of exposure, covers deviation and bills of lading, clarifies the charterers indemnity and confirm that the vessel remains on hire or on laytime and demurrage.
 
Members are advised to refer to BIMCO and to the Standard Club news item relating to these clauses.
 
Charterparties
Where no specific clauses are incorporated into a charterparty or bill of lading, the following considerations may be relevant to existing contracts.
 
Safety of the port
If the charterparty terms are standard, such that charterers obligation is to nominate a safe port, then the question of whether that nomination is a legitimate one depends on whether the vessel is able to reach, use and depart from the port without being exposed to danger which cannot be avoided by good navigation and seamanship.
 
In the context of infectious or contagious diseases, the point at which a port becomes prospectively unsafe is not easy to define, and the refusal to follow an order to a particular port will have knock-on impacts on the position under a voyage charter as well as any issued bill of lading for cargo on board.
 
Under a voyage charter, unless accompanied by a clause permitting deviation, a refusal to proceed to a named port can amount to a breach of contract or repudiation and in certain circumstances frustration. Voyage charters ought to be checked for any transhipment or lightering clauses, which may assist an owner in meeting their obligations.
 
A refusal to follow an order to a particular port is further complicated where cargo is on-board and a bill/s of lading issued. Irrespective of a debate concerning the safety of the destination, owners will be responsible for the care for the cargo and to deliver it to the named destination. Any deviation may prejudice club cover and owners may be liable to cargo receivers for any delays, costs and expenses which result from a deviation.
 
Charterers indemnity
The general right to an indemnity for following charterers orders, provides a route through which owners may be able to claim damages, costs and expenses arising from complying with those orders (provided that owners did not agree to bear that risk).
 
Delay – Off-hire and laytime
Depending on the terms of the time charter, delays arising from increased vetting, vessel checks (particularly for stowaways) or other legal or administrative restrictions may amount to an ‘event’ for the purpose of placing the vessel off-hire.
 
Under voyage charters, NOR, laytime and demurrage provisions must be checked.
 
An NOR may not be valid in circumstances where the granting of free pratique is delayed owing to increased checks imposed as part of disease control precautions. In that situation, the vessel should issue further NOR/s, without prejudice to the validity of the first, when free pratique is granted etc, to ensure that laytime is capable of being commenced (under the terms of the charter) prior to the point at which cargo commences being worked.
 
Where the parties are in the process of negotiating fixtures, then in addition to considering whether to adopt the BIMCO Infectious or Contagious Diseases Clause for Voyage and Time Charter Parties (as applicable), the following should be taken into account:
 
(a) Defining the risk and rights to refuse to accept orders and to deviate to a place of safety (to be back to back in any bill of lading to be issued)
(b) Hire – the vessel to remain on hire
(c) Laytime or demurrage – should any reduced running time be agreed, or all to run at full rate
(d) Should owners warrant that they have not called at an affected port or place
(e) The position of stevedores / other shore workers attending on board
(f) Wide indemnity provisions to catch additional costs and expenses relating to increased vetting/ checks, quarantine, fumigation, disinfection, medical treatment, repatriation and fines or penalties.
(The club is grateful to Beth Bradley and John Agapitos of Hill Dickinson LLP for providing this section.)
 
Club cover
P&I club cover will respond in the usual way if seafarers or third parties contract the virus. In addition members are directed to the club’s previous guidance relating to the deviation costs and expenses.
 
Regular club cover would also respond to costs and expenses incurred in the event the ship or cargo on board are placed into quarantine by appropriate authorities as a result of an outbreak of the virus on board the ship (subject to the usual exclusions within the rules).
 
In addition, Strike & Delay class members have protection against the cost of various delay events to their ships, depending on individual terms. These include:
 
• closure of port, berth, airport, road or railway as a result of an order by the authorities
• imposition of import or export controls, embargo or prohibitions
• illness, injury or death on board
• quarantine imposed on the ship
Source: The Standard Club


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