CSA to ‘closely monitor’ developments of valemaxes calling at Chinese ports

Following a statement released by Beijing in early July saying that seven iron ore berths will be allowed to accommodate those 400,000-dwt valemax bulkers, and a first fully laden valemax calling at Dongjiakou at Qingdao port on 25 July, it is now official that the VLOCs have found their way into China.

The powerful CSA has been lobbying against the entry of valemaxes into China over operational safety as well as criticising Brazil’s mining giant Vale for trying to monopolise the seaborne transportation of iron ore sold to China.

“We have to respect the Chinese government’s decision, but we will now closely monitor the impact of the valemaxes on our capesize market,” Zhang told Seatrade Maritime News.

“While we disagree on cargo owners such as Vale going into shipowning, that issue has somewhat been resolved now that Vale is transferring the ownership of the VLOCs to Chinese owners,” Zhang pointed out.

China’s shipping conglomerates Cosco Group and China Merchants Energy Shipping (CMES) have separately entered into similar sale and purchase agreements with Vale for the valemaxes to be owned by the Chinese corporations on the back of long term contract of affreightment (COA).

Zhang said the recent developments can only highlight that China is on the path of reform and open to global trade as part of an overall effort to ensure continual economic growth.

“The decision by Beijing is part of China’s continuing reform, but this does not mean that our domestic bulk owners can be left behind during that process,” he said. “In the end, a balance is needed between protecting the interests of our own companies and welcoming foreign trade and investments.”

Zhang believed that the progress ahead would mean that Chinese owners would need to dispose of more of their smaller bulk carriers, giving way to the supposedly more cost-efficient, larger bulkers which is the current trend.