A Finnish dry bulk player is diversifying to try and survive amid the record lows the sector is suffering.
ESL Shipping and the steel company SSAB have signed a long-term frame agreement covering SSAB’s inbound raw material sea transport within the Baltic Sea and from the North Sea amounting to 6m to 7m tons a year. ESL Shipping will order new, LNG-fueled ships. These ice-class 1A ships will be the first LNG-fuelled large bulk carriers in the world. CO2 emissions per ton of cargo transported will be reduced by more than 50% in comparison to present vessels, the company claimed in a release.
“Besides their environmental benefits, the cost savings provided by the new technology will also allow better profitability,” said Aki Ojanen, chairman of the board of ESL Shipping.
The two new 25,600 dwt vessels will be built at Sinotrans & CSC Qingshan Shipyard in China and will start operating in the Baltic Sea in early 2018. The total value of the investment is approximately EUR60m.
Separately, ESL Shipping has won a contract to ship biofuel to Sweden’s Fortum Värme in Stockholm, marking a big departure from its traditional dry bulk focus.
ESL Shipping, a subsidiary of diverse Finnish conglomerate, Aspo, will start shipping the fuel next month on a long-term contract. ESL has 14 ships in its fleet, 13 of which are owned.
In the past week the Baltic Dry Index has hit historic lows and analysts are predicting a tough 2016 for the sector too.
