Vale hunts for local support for its vessels access to China

Brazilian mining giant Vale (NYSE: VALE) has contacted China’s second largest container line China Shipping Group to negotiate a way for its very large ore carriers (VLOCs) to dock in Chinese ports again, reports Taipe Times.

Quoting China Shipping’s chairman Li Shaode, the article says that the company turned down any potential deal until Vale, the world’s largest iron ore producer and exporter, gets the local authorities’ approval for the ships.

Last year, China’s transport ministry announced a ruling that restricts ports’ right to accept super-sized vessels, giving room to speculation about Vale no longer being able to make full use of its VLOCs.

Vale’s plan is to use the Philippines as a trans-shipment hub that, while more expensive and employs more workers, will allow the product to reach China via smaller panamax and capesize vessels.

It takes at least a month for vessels from Brazil to reach China, versus a week from the Philippines. Vale is also setting up a trans-shipment hub in Malaysia as an alternative to Chinese ports.

Asked about this issue, Vale declined to comment.

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