The shipping industry sits at the intersection of global trade and climate responsibility. As regulatory pressure tightens, the challenge of reducing emissions while remaining competitive has never been more urgent.
The shipping industry accounts for around 3% of global greenhouse gas emissions — a figure that covers CO₂, methane, and black carbon combined. Despite improvements in fuel efficiency and vessel technology, absolute emissions from maritime transport are expected to grow alongside global trade in the coming years.
This represents a massive challenge for our customers and the industry in general: How to grow and reach new markets while reducing our environmental impact, or at least without worsening it?
While we recommend hearing it from the dedicated experts on this topic (links below), we see several steps the industry, and our customers, can take to start making progress.
Maintain and Improve Vessels
Carriers should be encouraged to continue upgrading their fleets with more efficient propulsion, maintaining hull and propeller conditions, and adopting new technologies — including methanol, ammonia, and other alternative fuels — while carefully considering the full lifecycle climate impact of each option. This means accounting for methane slip from fossil LNG (uncombusted methane that escapes into the atmosphere, where it is a far more potent warming gas than CO₂) and prioritising truly low- and zero-carbon fuels over time.
Yet recent analyses show that technical efficiency gains are often offset by growing transport demand, meaning absolute emissions can still rise even when individual ships become more efficient. Disruptions in the Suez and Panama canals in recent years compounded this effect, forcing vessels onto longer routes and higher speeds and eroding the emissions benefits of slow steaming. This suggests that improvement will not come from technology advances alone — and shippers who reward lower-emission carriers with their business are part of what makes the economics work.
Navigate the Regulatory Landscape
The International Maritime Organization (IMO), the UN agency responsible for governing international shipping, applies binding measures to reduce emissions through energy-efficiency and carbon-intensity rules for existing ships. In July 2023, the IMO adopted its revised GHG Strategy, setting a pathway to net-zero by or around 2050, with binding intermediate targets 2030 and 2040 — meaning the pressure to act is not a distant concern but an escalating one with checkpoints already on the horizon.
In parallel, European regulation has significantly raised the financial stakes. Since 2024, the EU Emissions Trading System (EU ETS) has applied to maritime transport. For voyages between EU and non-EU ports, 50% of emissions are covered; for voyages entirely within the EU, coverage is 100%. From 2026, intra-EU coverage also reaches 100% of reported emissions. Alongside EU ETS, the FuelEU Maritime Regulation — which sets gradually tightening limits on the carbon intensity of fuels used on EU-connected voyages — creates direct financial incentives to reduce fuel emissions on EU-connected voyages. For any trade touching European ports, carbon costs are now an integral part of voyage economics, not a future scenario.
For supply chain professionals already navigating freight cost volatility, this creates real tension. Carbon surcharges are already appearing on carrier invoices, and companies that build measurement and procurement capability now will be better positioned, commercially and in terms of compliance, than those that wait.
Increase operational efficiency
Shippers, forwarders, and carriers alike can play an important role through better planning and increased collaboration. A lack of visibility and predictive capabilities can cause shippers and forwarders to split what could be full container loads on a single vessel into several partially filled containers on several vessels. On many major trades, average container utilization still leaves a large share of capacity unused, and persistent trade imbalances mean carriers must reposition significant numbers of empty containers — adding both cost and emissions.
Shippers who cannot adequately match inventory and production timing to demand are often forced into air freight, which is significantly more carbon-intensive per tonne-kilometre. At Logward, our solutions help customers reduce their reliance on air freight, while our analysis of historical shipment data identifies opportunities to consolidate pre- and main-carriage movements.
Operational efficiency improvements are a challenge for any company — but they are among the few levers that deliver environmental and economic gains simultaneously.
Make data-based freight procurement decisions
You cannot reduce what you cannot measure. Most companies still struggle to comprehensively capture CO₂ emissions from logistics, and this is where one of the most actionable levers lies.
For supply chain professionals, logistics emissions fall squarely within Scope 3 under frameworks like the GHG Protocol and CSRD — specifically Category 4 (upstream transportation) and Category 9 (downstream transportation). Accurately capturing and reporting these emissions is increasingly expected by investors, customers, and regulators. Building measurement infrastructure now avoids a last-minute scramble and positions procurement teams ahead of the curve regardless of which phase applies to them.
The most precise way to measure CO₂ output is actual fuel consumption data. Shipping companies are increasingly required to monitor, report, and verify their emissions under IMO and EU frameworks. In the meantime, well-to-wake calculators — accounting for distance, speed, mode, vessel type, and fuel — offer a rigorous and actionable alternative when built on GLEC-approved methodologies
Drive Change Through Procurement
Once you have emissions data, you can use it the same way you use cost or transit time — as a factor in carrier selection. Measurement data directly improves procurement decisions. If a carrier is routinely sailing at higher speeds or underinvesting in fleet efficiency, shippers can vote with their wallet: choosing lower-emission alternatives creates direct market pressure for the technological and operational changes described above.
Our CO2 Calculator
It is on this last point where we are happy to say our free CO2 calculator can play its small part by providing easy access to a well-to-wake calculation of CO2, regardless of transport mode. Publicly available on the webpage, our tool considers route (distance), mode, vehicle and fuel type, and more, and relies on “emission factors,” which are trade specific CO2 estimates based on verified carrier reporting to the Clean Cargo Working Group. Powered by EcoTransIT, our calculator is built on a GLEC (Global Logistics Emissions Council) approved methodology supported by scientists and industry associations like BSR.
For European customers, the GLEC-based approach is particularly valuable: it maps directly to CSRD/ESRS reporting needs and enables a consistent emissions view across sea, air, road, and rail.
For customers using our solutions for route planning and procurement, we also use the same methodology to provide an estimated CO2 output for the suitable options. Once they move into actually booking a transport, we carry this CO2 information through to the end and include it in our dashboards and performance statistics, enabling analysis of CO2 by SKU, geography, business unit, and more.
We hope Logward can help our customers and the wider industry confront this generational challenge.
Sources
Some Groups, Companies and Experts tackling these issues:
- EcoTransIT World
- European Commission
- Arronax Podcast hosted by Craig Eason – Episode: IMO and the Other Race Toward Sustainable Shipping
- Zero North – seek to optimize vessel operations through digitalization.
- Spire Maritime – George, Olga and team at Spire provide API access to satellite AIS data, crucial information for those looking to independently measure exact distances.
- Breakthrough Fuel – Matt Muenster and the team measure fuel consumption and provide greater visibility into costs, including CO2.
- SeaRoutes – using AIS, weather, and routing information to create a different approach to CO2 calculation.
Sources used in this article:
Source 1 – World Economic Forum: Here’s how we can reduce shipping industry emissions and How the Shipping Industry Can Go Carbon Free
Source 2 – BBC: Why are we building gas-powered ships?
Source 3 – icct: Greenhouse gas emissions and air pollution from global shipping, 2016–2023
Source 4 – S&P Global: Suez Canal disruption boosts bunker consumption, emissions: UNCTAD report
Source 3 – International Council on Clean Transportation: GREENHOUSE GAS EMISSIONS FROM GLOBAL SHIPPING, 2013–2015
Source 4 – IMO – 2023 IMO Strategy on Reduction of GHG Emissions from Ships
Source 5 – Clean Cargo Working Group (BSR) Emission Factors: BSR Clean Cargo Emissions Report 2020