High Shipping Costs Are Here to Stay, Says Bloomberg
By Henry Ren (Bloomberg) Stubbornly high shipping expenses for businesses are getting sealed into contracts for the next 12 months, forcing companies to pass the extra costs on to consumers....
RIO DE JANEIRO, May 19 (Reuters) – Brazilian miner Vale said on Tuesday it agreed to sell four large iron ore carriers to China Merchants Energy Shipping Co (CMES), as it looks to raise cash in the midst of an iron ore price slump.
The world’s largest producer of iron ore said in a statement the details of the contract had not yet been finalised and will be released in the coming months.
In a separate statement on Tuesday, the miner said it had completed the sale of four other large iron ore carriers to China Ocean Shipping Company (Cosco), which was agreed last September. Vale said it expected to receive the $445 million from the sale in June.
Vale is in the process of selling its ore carriers, known as VLOCs or Valemaxes, as it looks to raise cash and improve relations with China’s shipping companies which had previously lobbied to block access of the ships to Chinese ports.
The 400,000-deadweight-tonnne vessels are some of the largest ships ever built. They were designed to help reduce the cost of shipping ore to China from Brazil, helping Vale better compete with Australian rivals who are closer to the largest market for the steelmaking ingredient. (Reporting by Stephen Eisenhammer; Editing by Marguerita Choy)
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