Vale considering mega ore carriers

The Brazilian iron ore producer Vale SA, is considering building 400,000 DWT ore carriers for its own fleet to serve the growing Chinese market and cut costs. Vale?s fleet has helped the Brazilian miner to reduce freight costs when shipping ore to Asia, and the company claims its own freight costs are “well below” spot market freight rates.

Commercial freight rates from Vale?s Brazilian ports to China, the world?s biggest iron-ore consumer, are double the rates paid by its competitors BHP Billiton Plc and Rio Tinto Group from Australia to China, because of the greater distance. Since the beginning of the global financial crisis, Vale has bought 15 second-hand bulkers and ordered 20 new ones to save on costs, the company said last week.