They may be longer than the Eiffel Tower is tall, but the fleet of Valemax mega ships hasn’t impressed the Chinese, who have banned them from docking at their ports. It has been a huge setback for their owner Vale, the Brazilian mining giant as the vessels were designed specifically to carry iron ore to China, its key market. The ban was enforced in mid-2011 and as we pointed out in WiC137, Vale can’t afford to idle these colossal freighters indefinitely; we thought it looked likely to find a compromise with Chinese shippers. This week that happened. Xinhua is reporting that Shandong Shipping had agreed to pay $500 million for four of the Valemax vessels.
The Wall Street Journal called it a “breakthrough” in the thorny Sino-Brazilian stand-off, while Economic Oberver noted of the deal’s specifics that Shandong Shipping has purchased the vessels but will lease them back to Vale. If this provides a blueprint expect to see a lot of Valemax vessels finally unloading at Chinese ports soon.
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