Zhoushan barges to be equipped with mass flow meters

The port of Zhoushan in China will promote the application of mass flow meters (MFM) on barges operating in the port, following their successful use in Singapore since 2017 to eliminate volume disputes and allow for greater accuracy.

There are currently 50 bunker barges in operation in Zhoushan, of which only one has MFM installed. The goal is to equip new barges and eventually the entire fleet with MFMs as stated in the port's regulations, according to a port official.

The port of Zhoushan further expects domestic producers of low-sulphur marine fuels to be able to enjoy tax rebates sometime during the fourth quarter this year, according to a port official. This would create a level playing field between domestically produced and imported bunkers, with the latter enjoying a tax-free status.

The adoption of MFM and tax rebates are part of a wider approach by the port to boost its competitiveness as a marine fuels hub in Asia, rivalling Singapore. Other initiatives include speeding up the production of low-sulphur bunkers by the Zhoushan refinery, implementing favourable terms to source IMO-compliant fuels from domestic firms and rolling out policies that will benefit the production of blended fuels.

These favourable policies and regulations are expected to narrow the price gap between bunkers in Zhoushan and Singapore. Prices of delivered on board high-sulphur 380cst bunkers in Zhoushan are typically $10/t higher than in Singapore, although occasionally they are cheaper, according to Argus data.

The port has invested heavily in improving its bunker infrastructure and services over the past two years. It has developed a new anchorage area and 17 new berths have been added, with another nine soon to be in operation. Zhoushan has also simplified its administrative approval application procedures and has optimised its refuelling regulations, which has streamlined bunker operations.

The port of Zhoushan is China's largest bunkering centre, with 3.59mn t of marine fuels supplied in 2018. Zhoushan expects to see that number rise gradually to 4mn t in 2019, 5mn t in 2020 and 7mn t in 2021, with a mid-term expectation of 10mn t. By comparison, Singapore sales totalled almost 50mn t last year or 25pc of the total global market. There are currently 12 bonded marine fuel suppliers active in the port of Zhoushan, of which seven are licensed by the Zhoushan port authority.