The global LNG Bunkering Market is estimated to be valued at US$ 1084.62 Mn in 2023 and is expected to exhibit a CAGR of 11% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.
Liquefied natural gas (LNG) bunkering refers to the practice of providing LNG as fuel for ships and marine vessels. LNG is an environment-friendly alternative for fuel oils as it produces lower emissions including greenhouse gases. The use of LNG as bunker fuel is gaining popularity among ship owners and operators due to rising environmental regulations aimed at reducing emissions from shipping industry. LNG as bunker fuel helps meet stringent emission norms and provide cost savings compared to conventional fuels over longer run. The market is driven by rising adoption of gas fuel technology by shipping companies and initiatives by ports to set up LNG bunkering infrastructure across major trade routes.
Market key trends:
One of the key trends in the LNG bunkering market is the rapid expansion of LNG fueled fleet. The International Maritime Organization’s regulations to reduce sulfur content in marine fuels is driving new vessel builds and retrofits to be LNG capable. The order book for LNG fueled vessels grew significantly over the past few years. As of 2020, over 300 vessels including containerships, tankers, bulk carriers were LNG dual fueled. This is increasing the demand for LNG bunkering facilities and services across ports. Another trend is strategic collaborations among market players to develop LNG bunkering infrastructure and supply chains. Major shipping companies are partnering with gas producers and port authorities to ensure stable LNG supply through marine bunkering. For instance, in 2021, Shell signed a deal with CMA CGM to supply LNG bunker for its containerships deployed on major trade lanes. Such initiatives are helping expand global availability and accessibility of LNG as marine fuel.
Threat of new entrants: The threat of new entrants is moderate as setting up new LNG bunkering infrastructure requires high capital investment. However, growing demand is attracting new players.
Bargaining power of buyers: The bargaining power of buyers is high due to the presence of many cargo vessel owners who can bargain for competitive prices. Buyers can also opt for conventional fuels if LNG prices are not competitive.
Bargaining power of suppliers: The bargaining power of suppliers is moderate as the supply market is fragmented with many private and public suppliers. However, suppliers have some control over prices due to unique infrastructure requirement.
Threat of new substitutes: The threat of new substitutes is low as LNG is considered a cleaner fuel compared to conventional fuels. However, new fuels like hydrogen could emerge as alternatives in long run.
Competitive rivalry: The competition is intense among existing players to expand market share through investments, partnerships and geographic expansion.
The global LNG Bunkering Market Share is expected to witness high growth, exhibiting CAGR of 11.% over the forecast period, due to increasing efforts by governments and international organizations to reduce emissions from shipping industry.
Regional analysis: North America dominates the LNG bunkering market currently due to growing LNG fueled fleet and infrastructure in the US. Asia Pacific is expected to witness fastest growth during the forecast period led by China, Japan and South Korea due to stringent emission norms and focus on expanding LNG infrastructure to access new bunkering locations.
Key players operating in the LNG bunkering market are Royal Dutch Shell Plc., Skangas, ENN Energy, Korea Gas Corporation, Prima LNG, Harvey Gulf International Marine LLC, Bomin Linde LNG GmbH & Co KG, Fjord Line, Crowley Maritime Corporation, and Polskie LNG. Key players are focusing on partnerships and expansion of infrastructure to strengthen market position.
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it