China should be in no rush to allow Brazil’s new Valemax ships, the world's largest dry bulk carriers, into its ports, as they have not been thoroughly tested and any oil leak from one could be catastrophic, an influential Chinese industry group warned on Tuesday.
Chinese ship owners want Beijing to keep the new mega vessels (VLOCs) out, fearing Vale, the world's biggest iron ore miner, will use them to monopolise the dry bulk shipping market at their expense.
China is the main market for Vale, a Brazilian mining giant.
The China Ship owners' Association (CSA) said the 400.000-tonne Valemaxes could pose a safety threat. A week ago, the Vale Beijing was found to have a leak as it was preparing for its maiden voyage.
Such mega ships have been newly built ... and it is not yet certain whether they can withstand various sea conditions the CSA said. If there is any leaking of fuel oil, the pollution will be catastrophic.
The CSA wields significant industry clout because its members control some 80% of China's shipping capacity, and many are state-owned companies.
The Vale Beijing is one of the first of almost three dozen huge bulk carriers commissioned by Vale, which sees the bigger vessels reducing its costs so it can compete better with Australian rivals BHP Billiton and Rio Tinto which are closer to the Chinese market.
Huang said he did not expect Vale's VLOCs to be calling at Chinese ports any time soon. A few Chinese ports may be able to accommodate those ships in terms of designed capacity, but this is not tested yet, and there's a lack of data to prove it is feasible.
Meantime the damaged Vale Beijing has been towed to an anchorage for repairs, according to STX Pan Ocean, which operates the 400,000 dwt iron-ore carrier.
South Korea-based STX has not explained the cause of the damage, although it confirmed that Vale Beijing had a cracked hull and a leak in a ballast tank.
The huge vessel, one of five currently in operation, was on its maiden voyage when it berthed in Ponta da Madeira port outside the city of Sao Luis. It had almost 380,000 tons of iron ore in its hold when it began taking on water earlier in the week.
The port is operated by mining giant Vale, which has a 25-year contract worth 6.2bn dollars with STX to ship iron ore.
Vale said the interruption at the port stopped it from loading 750.000 tons of ore. Port operations have now resumed. Ponta da Madeira port exports about a third of Vale’s annual output.
A crack in Vale Beijing’s ballast tanks was either the result of loading its holds or a structural problem, an official with the Sao Luis harbour pilots’ service revealed. There are no facilities to unload iron ore at Ponta da Madeira and no large shipyards in the area. Repairs must be made by divers while the ship is at anchor, the harbour pilots’ office said.
Vale Beijing was built at STX Offshore and Shipbuilding in Jinhae, South Korea, and inspected by Norwegian classification society Det Norske Veritas. It is registered in the Marshall Islands.