2024 brought a dramatic end to years of progress in reducing the container shipping industry's carbon footprint in the European Union.
Mandatory emissions data under the EU Monitoring, Reporting, and Verification (MRV) regulations revealed a staggering 45% increase in CO2 emissions from box ships.
The brutal reversal of the downward trend of the past 5-6 years or so prompts the question: can the sector reset its course to a greener future, or is the ongoing disruption to shipping in the Red Sea, which has triggered higher fuel consumption transit, now the new normal?
Impact ‘Disproportionately Severe’
The spike in emissions can be traced back to the end of 2023 when Houthi militia in Yemen, in reprisal for Israel’s actions in Gaza, began attacking ships heading for the Suez Canal.
Liner companies responded by diverting the vast majority of their vessels around the Cape of Good Hope, bypassing the Canal, lengthening journey times by up to two weeks.
“While the overall shipping sector saw a 10% rise in CO2 emissions, the impact on container shipping has been disproportionately severe,” according to a research analyst, SeaIntelligence.
It went on to highlight the “stark contrast” between the consistent decline in CO2 emissions from 2018 to 2023 and the unprecedented spike in 2024.
“From 2018-2023, the container vessels had consistently been reducing their emissions, despite growth in container volumes, with emissions, on average, declining by 4.4% at an annual average.”
Ongoing Disruption the New Normal?
Underlining the scale of the disruption to shipping schedules as a result of the Houthi threat, Paolo Montrone, global head of Trade, Sea Logistics, at Kuehne + Nagel, explained that a voyage from Shanghai to Genoa, in Italy via the Suez Canal, covers approximately 9,400 nautical miles.
“Detouring around the south of Africa adds roughly 4,700 nautical miles, extending the journey by about 50%. For a large 20,000 TEU container ship, daily emissions average around 300 tonnes of CO2. The extended route adds several days of sailing and millions of tonnes of extra emissions.
“The Suez Canal has rarely closed, most notably during the 1956 Suez Crisis and the 2021 Ever Given blockage. Yet, the current Red Sea conflict has caused a disruption far surpassing these events, leading to unprecedented environmental consequences.”
Alan Murphy, CEO at Sea-Intelligence, noted “purely hypothetically” that if there had never been a Red Sea crisis affecting box shipping and the container lines had again reduced their total emissions by 4.4% in 2024, this would have led to total emissions for the year of 34.7M tonnes.
“Instead, the reality was emissions of 52.7M tonnes. The additional 18 million tonnes of CO2 emissions in 2024, attributed to the round-Africa routing, are comparable to Cambodia's carbon emissions.”
Murphy added that the Red Sea crisis had not had a measurable impact on other shipping segments, as no major increase in emissions was recorded for these segments in 2024.
Net Zero Circa 2050 Remotely Achievable?
The EU’s findings on CO2 emissions from box ships last year and the analysis by Sea-Intelligence are closely aligned with data released this Spring by the ocean and air freight rate benchmarking and market analytics platform, Xeneta, in association with Marine Benchmark.
This showed that global ocean container shipping emitted all-time high CO2 emissions in 2024, driven largely by the impact of conflict in the Red Sea.
“The data is a timely reminder that, while the geo-political climate is heating up due to the US tariff announcements, we must not forget the actual climate emergency and the work that needs to be done in supply chains to combat it,” commented Emily Stausbøll, a senior analyst at Xeneta.
“With emissions heading in the wrong direction, it raises fundamental questions around whether the International Maritime Organization’s (IMO) target of net zero by or around 2050 is remotely achievable. Shippers must also understand the impact emissions regulations will have on their business and the role they can play in reducing carbon in supply chains.”
‘Inevitable Outcome’
Global container vessel emissions increased 14% in 2024 to 240.6M, according to the data, comfortably surpassing the previous record of 218.5M tons of carbon set in 2021.
“To be clear, this record-breaking statistic should not be used as a stick to beat the maritime freight industry with because it is largely due to ships sailing longer distances around the Cape of Good Hope following the escalation of conflict in the Red Sea in December 2023,” Stausbøll observed.
She said it was the inevitable outcome of these diversions, both in terms of the increase in transport work and the record-high demand of laden containers being moved in 2024, as shippers responded to the Red Sea crisis by front-leading imports.
Overall transport work – a measurement of tons of cargo moved multiplied by nautical miles sailed – increased 18% in 2024.
The record-high emissions data is a timely reminder of the colossal task at hand following a meeting in April of the International Maritime Organization’s (IMO) Marine Environment Protection Committee (MEPC) in London.
An agreement was reached during the meeting on specific reduction targets on fuel intensity in container shipping, as well as the financial penalties for non-compliance.
Biggest Increases In CO2 Came From The Largest Ships
Diving deeper into details behind the record-breaking emissions in 2024, Xeneta said the biggest increases in CO2 emissions came from the largest ships, with these also the ones to experience the biggest increases in transport work.
Emissions from ships between 14,500 TEU and 20,000 TEU hit 24.2M tons in 2024. This is up 7.3m tons (+43%) compared to 2023.
Ships over 20,000 TEU also saw large increases, up 35% from 2023 to 19.6M tons.
While ships over 14,500 TEU have had the biggest year-on-year increases, they are perhaps not the main cause for concern.
That is because ships between 8,000 and 12,000 TEU have a much higher share of total emissions.
The disproportionate relationship between the share of shipping capacity and the share of emissions is explained by bigger ships tending to be newer and therefore much more carbon-efficient.
New Attacks on Vessels
As to the prospect of container shipping in the EU reducing its CO2 footprint in the foreseeable future and a return to fuel-saving transit via the Suez Canal, the outlook appears rather bleak.
Hopes of an improvement in the situation were raised In May, when President Trump announced that the U.S bombing of Houthi bases in Yemen would stop, the Iran-backed group having supposedly agreed to cease interrupting the main shipping lanes in the Middle East.
However, earlier this month (July), the Houthis resumed assaults against merchant vessels in the Red Sea, claiming to have sunk the bulk carrier Magic Seas hours before a drone attack on another bulk vessel, Eternity C.
Two crew members died in the latter attack, the first victims of Houthi attacks since June 2024, taking the number of deaths from the rebels’ campaign to six, which does not square with the group's claim to have scaled back attacks to focus instead on the Israeli port of Haifa.
Stuart Todd
ajot.com