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....
The Valemax iron ore carrier Vale Minas Gerais docked at the port of Villanueva in the Philippines on Wednesday marking the first time a Valemax ore carrier had called on that port. This arrival followed a month and a half-long voyage from the Ponta da Madeira Maritime Terminal, in MaranhÃ£o state, Brazil, where the cargo had been onloaded. The cargo is destined for Japan’s JFE Steel, which received the vessel at its Philippines Sinter Corp (PSC) in Mindanao. JFE is one of Vale’s biggest clients.
Vale’s executive director for Ferrous and Strategy, JosÃ© Carlos Martins, said that JFE is the latest steelmaker to benefit from the advantages of scale and efficiency brought by a Valemax vessel. Until now, Ilva, ThyssenKrupp, Rogesa and Nippon Steel have received the very large ore carriers.
“We are in advanced negotiations so as to allow for other customers and ports also benefit from the advantages of these vessels,” Martins said.
“With the startup of our second floating transfer station expected for the first quarter of 2013, the distribution center in Malaysia and our entire fleet of Valemax vessels in place, Vale will be fully prepared to serve the Asian markets on equal terms with its competitors in the region,” he added. This whole logÃstics solution, encompassing vessels, floating transfer stations and distribution centers, is expected to be in place in early 2014.
The Valemax ore carriers, built by China’s Rongsheng Heavy Industries are the world’s largest iron ore carriers with the capacity to transport up to 400,000 metric tons of iron ore while reducing carbon emissions by 35% per ton of ore transported as compared to transport via capesize vessels.
This was the maiden voyage of Vale Minas Gerais, part of a fleet of Valemax vessels totaling 18 ships (owned and chartered). The Valemax ships are part of Vale’s strategy to reduce the economical distance between Brazil and Asia, the main consumer market for iron ore. The very large ore carriers adhere to strict safety standards and contribute significantly towards reducing the carbon footprint in the long haul transportation of iron ore as well as to reductions in the cost of seaborne transportation of iron ore to steelmakers.
With the Villanueva port, seven ports are receiving the Valemax vessels. So far, they have called at the ports of TubarÃ£o and Ponta da Madeira (Brazil), Taranto (Italy), Rotterdam (Netherlands), Sohar (Oman) and Oita (Japan) as well as Vale’s floating transfer station in Subic Bay, in the Philippines. By the end of 2013, there will be a total of 35 similar vessels available to transport Vale’s iron ore – 19 owned by Vale and 16 chartered from international shipowners.
Join the 67,412 members that receive our newsletter.
Have a news tip? Let us know.