With 19 methanol/ethanol-capable vessels now on order, Drewry says alternative-fuel capability could increasingly influence chartering decisions, although fuel availability, costs
With 19 methanol/ethanol-capable vessels now on order, Drewry says alternative-fuel capability could increasingly influence chartering decisions, although fuel availability, costs and regulatory uncertainty remain key obstacles.
Fuel flexibility is beginning to gain traction in the dry bulk sector, with 19 methanol/ethanol dual-fuel vessels now on order for the first time, according to Drewry Deputy Director of Dry Bulk Rahul Sharan. However, the commercial case for investing in alternative-fuel technology remains uncertain as shipowners weigh the additional costs against the competitiveness of conventional tonnage.
Although the first methanol/ethanol-capable dry bulk vessels entered the orderbook in 2023, interest accelerated from May 2026, reaching 19 vessels by September. The development forms part of a broader shift in alternative-fuel preferences, with LNG initially dominating the dry bulk orderbook before methanol gained momentum in 2023 and ammonia emerged in 2024.
Much of the recent growth is linked to mining group Vale’s fuel-flexible ore carrier programme, which envisages up to 30 large vessels capable of operating on methanol or ethanol. Several shipowners have ordered such vessels against long-term employment with the miner.
However, not all owners are prepared to commit to the additional investment. Pacific Basin, for example, replaced four planned methanol dual-fuel Ultramax newbuildings with conventionally fuelled vessels, reducing the reported programme cost from $186 million to $156.8 million, while retaining options for two dual-fuel ships.
The company partly attributed the decision to uncertainty surrounding the International Maritime Organization’s (IMO) Net-Zero Framework.
The contrasting strategies highlight the industry’s dilemma: whether to invest in fuel flexibility ahead of wider adoption or prioritise the lower capital costs and established economics of conventional vessels.
Retrofitting could provide another route for owners seeking to delay investment decisions. Drewry’s Head of Maritime Advisory, Jayendu Krishna, has noted increased interest in methanol retrofit projects as engine manufacturers develop conversion packages. Nevertheless, high alternative-fuel prices and limited availability continue to restrict actual consumption.
According to Drewry’s analysis of IMO data, alternative fuels accounted for 9.5% of shipping’s total energy demand in 2025, while methanol represented just 0.3% of alternative-fuel consumption. This gap highlights the difference between investing in vessels capable of using alternative fuels and operating them commercially on those fuels.
Recent developments nevertheless suggest that alternative-fuel use is moving beyond the trial stage. In October 2026, the methanol dual-fuel containership Maersk Halifax bunkered approximately 5,000 tonnes of certified bioethanol in Singapore, demonstrating progress in the use of alternative fuels in commercial shipping.
For dry bulk operators, however, widespread fuel availability will be particularly important. Unlike containerships, which generally operate on established liner networks, bulk carriers frequently move between different regions and ports. Limited bunkering infrastructure could therefore restrict trading flexibility or increase voyage costs, reducing the commercial incentive to use alternative fuels.
The competitive equation could change as alternative-fuel prices decline, bunkering networks expand and rising carbon costs make conventional fuels more expensive.
Charterers and major cargo owners could also accelerate adoption by incorporating vessel fuel capability and emissions performance into their selection criteria as they seek to reduce Scope 3 emissions.
Fuel efficiency, emissions exposure and access to alternative bunkering could increasingly determine which vessels are competitive for particular cargoes and routes. Even where two bulk carriers offer similar carrying capacity, differences in fuel costs and regulatory exposure could influence their attractiveness to charterers.
As a result, fuel-flexible and more efficient vessels could gain access to a broader range of employment opportunities, while older conventionally fuelled ships may face increasing pressure on trades where emissions performance and carbon costs become more influential.
For the dry bulk sector, the transition is therefore not simply about which fuel will dominate, but whether the ability to switch between fuels will become a decisive factor in determining a vessel’s long-term commercial value.
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