June 19, 2025
Steamship Mutual Club has issued an alert to inform about managing and reducing the risks associated with purchasing marine fuel amid the growing complexity of the issue due to different Emission Control Area (ECA) regulations.
As highlighted by Steamship Mutual, while considerable time and resources are dedicated to addressing fuel related issues post-delivery, there is significant value in exercising diligence during the bunker procurement process to mitigate the possible occurrence of these issues.
Establishing a bunker procurement plan:
The process of procuring bunkers can be developed either as a standalone Bunker Procurement Plan or as part of an existing Procurement Management System or Quality Management System (QMS) within the organisation.
Regardless of the chosen framework, the plan should include a methodology for evaluating bunker suppliers based upon identifying predetermined metrics for assessing their reliability. The methodology could involve assigning scores to various metrics, evaluating them according to their relevance, and calculating an overall score for each bunker supplier.
This scoring system would enable Members to make informed decisions before awarding bunker contracts. Adopting the ISO 9001:2015 framework for evaluating and selecting suppliers would be beneficial, although not essential, to achieving the desired outcome of identifying a reliable bunker supplier.
Setting evaluation metrics:
The reliability of the process hinges on establishing robust evaluation metrics. These metrics should be designed to assess the track records of bunker suppliers at each port. While evaluating a bunker supplier on a global scale can be beneficial, it may also be misleading due to the influence of local factors within the supply chain.
Understanding and examining potential factors that may influence the quality and / or quantity of bunkers is essential for developing effective metrics against which to assess bunker suppliers. These factors may include identifying whether the entity:
- Acts as the physical supplier or utilises the services of third party entities.
- Maintains appropriate control over the origin and chain of custody of the bunkers
- Conducts periodic quality assurance checks and audits on the third-party entities involved.
- Has a record of the number of successful bunker deliveries completed in the port.
- Has reported instances of bunker deliveries that experienced quantity or quality issues in the port.
In developing the scoring system, it would be pertinent to note that all metrics derived from the influencing factors may not be equal, and the weighting of each metric should be assigned based on its influence on the outcome. For instance, a high weighting should be assigned to the metric “Supplier is the physical supplier?” which would provide assurance that the supplier has control over its downstream operations.
Collection of data:
The effectiveness of the Bunker Procurement Plan as a vetting tool relies on the availability and veracity of data to evaluate the established metrics. This data can be obtained from two sources:
- Market intelligence
- Internal feedback from the bunker receivers
According to Steamship Mutual, while market intelligence is generally accessible, the specific granular data needed may not always be readily available. However, it serves as a strong foundation to initiate and sustain the process. Initially, internal feedback data may be limited however, over time, it should develop into a comprehensive internal source of intelligence that can be highly beneficial.
Therefore, the Bunker Procurement Plan should incorporate a streamlined feedback loop that captures data from each bunker delivery, thereby ensuring the ability to vet bunker suppliers is strengthened with each completed delivery.
Evaluation:
With the evaluation metrics that have been established and data available from market intelligence sources, as well as internal resources, prospective bunker suppliers can be assessed more effectively.
To ensure consistency in the evaluation process, the Bunker Procurement Plan should define clear acceptance criteria to guide the procurement team. Depending on the process flow outlined in the plan, these criteria can help the procurement team determine whether it is acceptable to proceed with a supplier or if additional approval is necessary.
