Vale claims positive talks with China over valemaxes

Vale and China are discussing the technical requirements needed to accommodate the mega-sized iron ore carriers, including berth strength and port depth, according to Luiz Meriz, head of iron ore marketing at Vale.

Meriz told The Wall Street Journal at the sidelines of a conference that opposition from the Chinese shipowner community has been “exaggerated”.

China Shipowners' Association (CSA) has long protested against the idea of permitting the huge bulkers, or valemaxes, into Chinese ports due largely to safety issues.

The voice of CSA, led by executive vice chairman and secretary-general Zhang Shouguo, criticised Vale of trying to establish a monopoly and create unfair competition as the miner owns the cargoes and now intends to control freight rates via its own fleet.

Zhang had told Seatrade Asia Week last year that Vale and CSA have held are closed door talks in an attempt to diffuse the tension.

Vale is eyeing direct access into China for its valemaxes to reduce transport costs. Meanwhile, it is starting its iron ore distribution centre in Malaysia by the middle of 2014, in addition to a second floating transhipment facility coming on-stream at Subic Bay in the Philippines.

Meriz said feeder ships currently transport iron ore delivered to Subic Bay by the valemaxes to China's Qingdao port on a four-day journey.