Cosco axes bulk carrier orders

China Ocean Shipping Group Company (Cosco) has cancelled bulker newbuildings ordered at its own shipyards in China. Two subsidiaries of Cosco, Qingdao Ocean Shipping and Cosco Hong Kong Shipping, have axed eight 57,000 dwt Supramax newbuildings ordered at Cosco Zhoushan Shipyard.

The contracts were worth $298.7m, according to Singapore-listed Cosco Corp, which owns a 51% stake in Cosco Shipyard Group (CSG). Work was yet to be started on any of the eight cancelled bulkers.

In addition, the two China Cosco companies have also delayed a trio of 57,000 dwt bulkers that were due to be delivered between June 20th and December 10th last year. The three vessels are now set to be delivered between August 15th and October 31st this year.

For the cancelled newbuildings CSG will refund all instalments made by the China Cosco companies. In turn, China Cosco has agreed to not to pursue any claims for late delivery of vessels.

The cancellations by China Cosco add to CSG’s newbuilding contract woes with over one third of its orderbook now either delayed or cancelled. In total, shipowners have delayed delivery of 32 vessels at its yards and cancelled 13 newbuildings.