Vale giant ore ship makes maiden arrival in China
China has received the first of Vale's giant iron ore vessels, industry sources said on Wednesday, a major breakthrough for the Brazilian miner after months of uncertainty over the fleet's access to the world's top steelmaker, Reuters reports.
Top iron ore exporter Vale is spending billions of dollars to build the world's biggest dry bulk ships to cut the cost of shipping the steelmaking ingredient to China, but until now had failed to gain Beijing's approval for the six vessels already on the water to even stop at a Chinese port.
Reuters Freightviews and independent shipping data showed Vale's vessel, Berge Everest, anchored off China's Dalian port with its draught measurements indicating it was fully loaded with cargo.
Industry sources said there was 350,000 tonnes of iron ore onboard, but it was not clear whether the vessel had clearance to unload.
Vale officials in China and Brazil declined to comment on Wednesday. A spokeswoman for the ship's owner, Singapore-based Berge Bulk, and Dalian port officials were not immediately available for comment.
Vale's fleet has faced stiff opposition from influential Chinese shipowners and steelmakers, who fear the ships are a Trojan Horse which the miner will use to monopolise both the shipping and iron ore markets at their expense.
"Vale's ships won't break any company, but it will be damaging," said a Singapore-based ship broker said on Wednesday.
Vale's first mega bulk vessel, Vale Brasil, was forced to turn around in the Indian Ocean on its maiden voyage in June after the Chinese government failed to provide permission for the ship to dock at Dalian. It went to Taranto, Italy, instead.
SHIPOWNERS
The arrival of the Berge Everest could not come at a worse time for Chinese shipowners, already struggling with a severe downturn in the industry driven by rock bottom freight rates, high bunker fuel prices and an oversupply of ships.
Things got so bad that China's top shipping conglomerate COSCO Group and Grand China Logistics were forced to temporarily halt payments to foreign ship owners earlier this year to renegotiate better terms.
China Shipowners Association urged Beijing this month not to rush into any decision on Vale's ships, warning that they have not been thoroughly tested and any oil leak from one could be catastrophic.
"The China Shipowners Association has been aware of this since Monday and now is trying to get a clear picture of the whole story," an industry source said.
One of Vale's vessels, Vale Beijing, became severely damaged while preparing to set sail on its maiden voyage earlier this month.
Vale is planning to build a fleet of 35 giant vessels, each with capacity of around 400,000 tonnes, to feed top importer China's growing demand for the commodity. The firm aims to ship around 130 million tonnes, or 40 percent of its total iron ore output, to China next year.
China is expected to import a total of around 720 million tonnes of iron ore in 2012, up from 679 million tonnes this year, according to a Reuters poll. China consumes over a billion tonnes per year of iron ore.
Shipping data this week initially showed the Berge Everest destined for a port in the Philippines after a brief stop earlier in Singapore.
"For the past few days, it was drifting around the Phillippines area awaiting instructions," said T.S. Ang, technical executive at BW Fleet Management, which manages the crew and safety operations on Berge Everest. He was unable to confirm the ship's current location.
Top iron ore exporter Vale is spending billions of dollars to build the world's biggest dry bulk ships to cut the cost of shipping the steelmaking ingredient to China, but until now had failed to gain Beijing's approval for the six vessels already on the water to even stop at a Chinese port.
Reuters Freightviews and independent shipping data showed Vale's vessel, Berge Everest, anchored off China's Dalian port with its draught measurements indicating it was fully loaded with cargo.
Industry sources said there was 350,000 tonnes of iron ore onboard, but it was not clear whether the vessel had clearance to unload.
Vale officials in China and Brazil declined to comment on Wednesday. A spokeswoman for the ship's owner, Singapore-based Berge Bulk, and Dalian port officials were not immediately available for comment.
Vale's fleet has faced stiff opposition from influential Chinese shipowners and steelmakers, who fear the ships are a Trojan Horse which the miner will use to monopolise both the shipping and iron ore markets at their expense.
"Vale's ships won't break any company, but it will be damaging," said a Singapore-based ship broker said on Wednesday.
Vale's first mega bulk vessel, Vale Brasil, was forced to turn around in the Indian Ocean on its maiden voyage in June after the Chinese government failed to provide permission for the ship to dock at Dalian. It went to Taranto, Italy, instead.
SHIPOWNERS
The arrival of the Berge Everest could not come at a worse time for Chinese shipowners, already struggling with a severe downturn in the industry driven by rock bottom freight rates, high bunker fuel prices and an oversupply of ships.
Things got so bad that China's top shipping conglomerate COSCO Group and Grand China Logistics were forced to temporarily halt payments to foreign ship owners earlier this year to renegotiate better terms.
China Shipowners Association urged Beijing this month not to rush into any decision on Vale's ships, warning that they have not been thoroughly tested and any oil leak from one could be catastrophic.
"The China Shipowners Association has been aware of this since Monday and now is trying to get a clear picture of the whole story," an industry source said.
One of Vale's vessels, Vale Beijing, became severely damaged while preparing to set sail on its maiden voyage earlier this month.
Vale is planning to build a fleet of 35 giant vessels, each with capacity of around 400,000 tonnes, to feed top importer China's growing demand for the commodity. The firm aims to ship around 130 million tonnes, or 40 percent of its total iron ore output, to China next year.
China is expected to import a total of around 720 million tonnes of iron ore in 2012, up from 679 million tonnes this year, according to a Reuters poll. China consumes over a billion tonnes per year of iron ore.
Shipping data this week initially showed the Berge Everest destined for a port in the Philippines after a brief stop earlier in Singapore.
"For the past few days, it was drifting around the Phillippines area awaiting instructions," said T.S. Ang, technical executive at BW Fleet Management, which manages the crew and safety operations on Berge Everest. He was unable to confirm the ship's current location.