What is Freight Parity?

Freight parity exists when the cost to ship LNG is the same among the various types of LNG vessel propulsion systems. For example, more modern XDF-MEGI vessels typically receive higher day rates than the older steam and diesel fuel vessels, but offer lower operating costs in the form of less LNG boiloff and reduced bunker fuel. Under conditions of freight parity, the higher shipping charter costs of more modern vessels would be offset by lower operating costs, such that the total cost to ship LNG would be the same among all vessel classifications.