Giant Valemax Ship Delivers Iron Ore to New Malaysian Terminal

Published Mar 25, 2014 10:21 AM by The Maritime Executive

Top iron ore producer Vale said it has delivered 382,500 tonnes of iron ore via one its giant Valemax ships to a new storage and distribution center in Malaysia, as the Brazilian miner moves closer to China, its biggest market.

The iron ore to be unloaded from the Berge Everest ship will be stored in the Teluk Rubiah terminal for future commercial shipments, Vale said in a statement on its website on Monday.

The Malaysian distribution hub, built at a cost of $1.37 billion, is expected to be completed by the second half of 2014, said.

Vale invested billions of dollars in the 400,000-deadweight-ton Valemax vessels, the world's largest dry bulk carriers, to cut transport costs to China and to better compete with Australian rivals Rio Tinto and BHP Billiton.

But China banned the Valemax ships in January 2012, to protect its own shipping industry, and about a month after the first of the giant vessels docked at Dalian port. There are currently 30 Valemax ships in operation, Vale said.

The firm's efforts to persuade Chinese authorities to allow its Valemax ships access to Chinese ports suffered a setback in February when China's transportation ministry set a maximum capacity of 250,000 dwt for ships berthing in the country.

The Malaysian terminal will cut Vale's transport costs by $4-$5 a ton, smaller than the $7 it would save per ton if the Valemax ships were able to ship cargoes directly to China.

Apart from the Malaysian center, the miner also has two floating transfer stations in the Philippines.