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    Cargo ships transport approximately 90% of global trade, and although maritime transportation has the lowest carbon footprint per ton transported, shipping still accounts for some 3% of global greenhouse gas (GHG) emissions. As responsible freight operators, we are active in advancing shipping industry decarbonization in collaboration with increasing maritime value chain participants, by embracing digital transformation and new technologies with the potential to shape a safer and more sustainable maritime sector.

    “As a pre-condition for a successful carbon transition at sea, shipping industry participants must intensify dialogue with, and make transparent investments in, seafarers – an essential workforce working ‘behind the scenes’ for the continuity of maritime trade.”

    Sébastien Landerretche

    Head of Freight

    Sebastian Landerretche

    Statistics

    Overview

    2021 proved a challenging year for environmental sustainability efforts in the maritime industry as a whole, and LDC was no exception. Our statistics show a year-on-year increase in CO2 emissions from shipping operations and a reduction in efficiency indicators, largely driven by market externalities beyond our control.

    The welcome global rebound from pandemic-related restrictions saw increased volumes of goods transported, which drove increased total emissions, exacerbated by an increase in both the world’s average fleet speed and waiting times at port, as a result of high prices and port congestion.

    Furthermore, compliance with the Sea Cargo Charter, of which LDC was a founding signatory in 2020, saw changes to our emissions reporting year on year, which participated in the increase of our total CO2 footprint, Energy Efficiency Operational Indicator (EEOI) and Annual Efficiency Ratio (AER) metrics.

    Notwithstanding, we continued to make progress on our shipping decarbonization journey.

    Individually, we continued to make headway in relation to technical and operational efficiency initiatives, and assembled a dedicated team of specialists tasked with exploring all aspects of decarbonization in relation to ocean transportation.

    In parallel, consistent with LDC’s collaborative approach to sustainable development, we signed the Global Maritime Forum’s global call to action for shipping decarbonization by 2050 and, recognizing that seafarers are essential to shipping industry continuity, resilience and decarbonization, continued to work with partners to alleviate some of the issues highlighted by Covid-19 in relation to seafarers’ rights and welfare, pushing for regulatory advancement on these and other fronts.

    Call-to-Action for Shipping Decarbonization

    Alongside more than 230 leaders and organizations representing the entire maritime value chain, in 2021 we signed a formal call for decisive action to enable full international shipping decarbonization by 2050.

    The call-to-action insists that shipping must align with the Paris Agreement goal to limit global warming to 1.5°C and be run entirely on net-zero energy sources by 2050, achieving well beyond the International Maritime Organization’s target to halve GHG emissions by 2050, compared to a 2018 baseline.

    To deliver on this ambition, we recognize that the private sector must invest in research and development, the production of net-zero emission fuels, port and bunkering infrastructure, zero emission-ready vessels, and more. As outlined in the call to action, national governments and regulators around the world must also support such investments by establishing policy frameworks that make zero emission shipping and fuel production commercially viable, investable, equitable and inclusive.

    Code of Conduct for Seafarers

    The new seafarers’ Code of Conduct launched in 2021 is designed as a tool to help shipowners, operators, charterers and cargo-owners ensure responsible shipping operations by protecting the rights and welfare of seafarers.

    The pandemic highlighted shortcomings in the working conditions of seafarers and continues to have a considerable impact on maritime trade and its workforce. In 2020, a slow global Covid-19 response compounded by supply chain disruptions left thousands of seafarers stranded at sea beyond contractual duration, strained dry bulk flows with inefficiencies and delays, and increased operational hazard risks to vessels and cargos.

    In response to this humanitarian crisis, and having already signed the Neptune Declaration, in 2021 LDC helped to develop and launch a dedicated Code of Conduct to protect the rights and welfare of seafarers. Developed in collaboration with the Sustainable Shipping Initiative and Institute for Human Rights and Business and Rafto Foundation for Human Rights, this new code covers the full spectrum of seafarers’ rights and welfare, from fair terms of employment and crew protection, to availability of grievance mechanisms.

    While it seeks to reinforce compliance with the International Labour Organization’s Maritime Labour Convention (MLC), the Code goes beyond this by directly addressing systemic risks experienced by seafarers, highlighting MLC rights that are not adequately enforced, and including new rights and issues not yet covered by the MLC.

    Technical & Operational Efficiency

    We continued to work with tech-innovative stakeholders in 2021, to investigate new ways to reduce the fuel consumption and emissions of the ships we charter.

    As part of this work, LDC commissioned an independent study to evaluate the performance of four wind-assisted propulsion systems (WAPS). Mandating Lloyd’s Register as independent expert, the four WAPS were compared on various trade routes for a kamsarmax vessel (80,000-85,000 DWT). The study aims at identifying true expected performance and selecting candidates for a pilot project, with the ambition to make a number of investments in this new technology as early as 2022.

    We also worked in partnership with i4 Insights, Lloyd’s Register’s digital arm, in trialing their solution to improve vessel efficiency at sea via better routing and hull fouling monitoring.

    Targets

    Reduce our fleet emissions per ton-mile by 15%, compared to 2017

    Completion: 2022

    Status: In progress

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