SHANGHAI Brazilian miner Vale SA is losing $2 to $3 per tonne on iron ore shipped to China due to a port ban on its Valemax vessels, according to Jose Carlos Martins, the companys iron ore chief.
Having the vessels dock in China would save the worlds largest iron ore producer $6 per tonne in shipping costs compared with using smaller ships to transport the steelmaking raw material, media reports quoted Martins as saying.
The companys distribution point for its Valemax shipments is the Philippines Subic Bay, where the vessels transfer iron ore to smaller ships for distribution to China.
But Vale appears to be confident that it will receive the green light from Chinese authorities next year for its Valemax vessels to dock at the countrys ports. "The Valemax logistics are ready. Negotiations for start-up in China are being conducted at a diplomatic level, and also with ship owners, ports and clients," Vale said.
The Valemax vessels can carry up to 400,000 tonnes of iron ore. Rio de Janeiro-based Vale ordered a fleet of the vessels to compete with its Australian rivals, who have freight advantages.
A version of this article was first published by AMM sister publication Steel First.