MACS and South32 conclude sustainability linked contract of affreightment

MACS and South32 have signed a contract of affreightment (“COA”) for shipment of aluminium ingots from South32’s Hillside aluminium smelter in Richard’s Bay, South Africa on certain routes. MACS and South32 have jointly developed a mechanism where freight charges under the COA are linked to carbon dioxide emissions, essentially introducing a carbon price into the contract. This unique approach furthers the commitments by MACS and South32 to reduce carbon emissions in the supply chain, supporting operational efficiencies that translate to tangible environmental benefits.

The mechanism is similar to a Carbon Adjustment Factor, where MACS is paid a higher freight if shipping emissions are lower than benchmark, and consequently receive less freight if emissions are higher than benchmark.

MACS Managing Director Felix Scheder-Bieschin commented: “This novel method to calculate freight rates underlines our commitment to reduce our carbon footprint and to meet our clients’ expectations.”

South32 Vice President and Head of Marketing Matthew Gillespie said, “With this collaborative agreement we are adopting new sustainable principles for shipping our products, supporting the work we are doing across our group to reduce greenhouse gas emissions.”

About MACS:
MACS is a privately owned ship owner and operator, running independent liner services for breakbulk, bulk, project cargoes and containers between Europe, Southern Africa and North America. The trade lane between Europe and North America is serviced by the Group Company Stinnes Linien.

About South32:
South32 is a globally diversified mining and metals company. Our purpose is to make a difference by developing natural resources, improving people’s lives now and for generations to come. We are trusted by our owners and partners to realise the potential of their resources. We produce commodities including bauxite, alumina, aluminium, copper, silver, lead, zinc, nickel and manganese from our operations in Australia, Southern Africa and South America. We also have a portfolio of high-quality development projects and options, and exploration prospects, consistent with our strategy to reshape our portfolio toward commodities that are critical for a low-carbon future.

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