XINDE MARINE NEWS
A new Chinese Capesize bulk carrier owner has emerged! xinde marine news 2024-06-12 08:53

On May 31st, #BAO-NYK Shipping Company Limited(#宝船航运), a subsidiary of China Baowu Steel Group Corporation Limited, officially took delivery of its first Capesize bulk carrier, the BNS DONGSHAN. This marks a significant milestone for the company, transitioning from a non-vessel operating common carrier (NVOCC) to a ship owner. 
 
With this acquisition, the global shipping market now has another key player in the Capesize bulk carrier segment.

Image Source: China Baowu
BAO-NYK Shipping Company Limited operates under the Baowu Resources Logistics Division, a subsidiary of Baowu Steel Group. Established in Singapore in 2013, BAO-NYK is jointly owned by Baowu Resources Holdings and Nippon Yusen Kabushiki Kaisha (@NYK Line). The company primarily provides ocean transportation services for Baowu's iron ore imports from Australia.
 
According to information from MarineTraffic provided to Xinde Marine News, the BNS DONGSHAN was built in 2011, measuring 292 meters in length, 45 meters in beam, and with a maximum draft of 18.24 meters. It is an 181,572 dwt Capesize bulk carrier.

Although the commercial history of the BNS DONGSHAN has not yet been updated, it was previously known as the Frontier Mirage. In pursuit of long-term development, BAO-NYK Shipping Company Limited has focused on increasing its fleet capacity to support overseas mining projects, thereby enhancing the security of iron ore imports. Earlier this year, BAO-NYK signed a memorandum of understanding with NYK Line in Singapore to purchase this 180,000-ton bulk carrier.
 
The successful signing of the purchase agreement and the official delivery of the BNS DONGSHAN represent BAO-NYK's entry into the Capesize bulk carrier ownership arena. This acquisition opens new horizons for Baowu Resources' maritime logistics operations for its overseas mining projects.
 
Baowu Steel Group further revealed that the vessel was named BNS DONGSHAN after the company's significant user base at the Zhanjiang Dongshan base.
 
As depicted, the vessel's funnel is painted blue, featuring the Baowu logo, complemented by NYK Line's distinctive red double stripes. This symbolizes BAO-NYK Shipping Company Limited's commitment to serving Baowu, growing stronger with the joint support of Baowu Resources and NYK Line shareholders.
 
Currently, the BNS DONGSHAN primarily serves the Australian "Silk Road Powder" mining project for Baowu Resources. In the future, it will also support the Simandou project, providing a more reliable solution for the stable transportation of iron ore, further ensuring the long-haul capacity for Baowu Resources' overseas mining projects.
 
China Baowu highlighted that the acquisition and operation of the BNS DONGSHAN enhance their fleet's strength and align with the company's long-term strategic development goals. BAO-NYK aims to seize market opportunities, continuously improve fleet strength and shipping service levels, and persist in technological innovation to expand market share and support the sustainable development of the logistics and shipping industry.
 
While the transaction price for the BNS DONGSHAN was not disclosed, VesselsValue recently reported that newbuilding prices for bulk carriers have surged to their highest levels in 15 years since the beginning of 2024. Strong market demand, growing capacity needs, and rising steel prices and shipyard costs are the main factors driving these high prices. Notably, the price increase for Capesize bulk carriers has been significant, with the cost of an 180,000 dwt Capesize vessel rising from $66.09 million to $69.63 million, a 5.45% increase.
 
Clarksons Securities analysts recently noted that the Simandou iron ore project’s ramp-up phase will provide substantial iron ore supply to the shipping industry, significantly boosting Capesize bulk carrier demand by 2025.
 
Clarksons estimates Simandou’s effective annual output to reach 110 million tons. The investment bank commented, "Considering the longer loading times due to transshipment in the region, we believe the Simandou mine has the potential to require approximately 170 Capesize bulk carriers annually by 2028 when it reaches full capacity." Currently, there are 116 Capesize bulk carriers on order, indicating a need for an additional 54 new orders.
 
Several Capesize bulk carrier owners highlighted the Simandou project's prospects in their first-quarter financial reports. Owners remain optimistic about the future of the bulk carrier market. For instance, Denmark's Norden expanded its Capesize fleet in the first quarter, ordering four new vessels and purchasing two modern second-hand Newcastlemax vessels. Norden aims to build a fleet of 20 to 25 Capesize vessels, focusing on the "classic" Capesize segment, transporting iron ore, coal, and bauxite.

by Xinde Marine News Chen Yang

The opinions expressed herein are the author's and not necessarily those of The Xinde Marine News.

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