Precious Shipping: Fleet renewal plans thwarted by poor Chinese construction

Precious Shipping: Fleet renewal plans thwarted by poor Chinese construction

Bangkok: Plans by Thailand’s Precious Shipping to be ahead of the curve when it comes to having a young eco-fleet have been hit hard by faulty Chinese shipbuilding.

Khalid Hashim, the veteran managing director of the dry bulk firm, relates how most of the the ships being built in China have not been as fuel efficient as promised.

The company has a 38,000 dwt handysize to be delivered from Shanhaiguan, plus twelve 64,000 dwt ultramaxes at Sainty Marine and ten similar ultramaxes at Taizo Sanfu.

“Sainty Marine are in serious financial difficulties,” Hashim says. “They have also not been able to construct ships in accordance with the agreed specifications in the ship building contracts.”

As a result, two ultras that have been ready for delivery at Sainty Marine since May this year have been rejected by Precious as they consume far more fuel per day than what has been described in the contracts.

“As there has been no change in the design of these ultramax ships, we suspect that all the remaining 20 ultramax ships scheduled for delivery in the next 12 months will face a similar fate,” Hashim says.

The handysize being built at Shanhaiguan faces no such problems and hence will be accepted at the time of delivery in October.

“The entire plan was to build super eco ships at the three Chinese yards thereby having a very young and economical fleet in operation.  This would have helped us earn more money than our competitors who were and are still running with older design ships that are nowhere near as economical as the ships on order,” Hashim relates. “Our plan was to sell the older ships in the fleet once the new ships were delivered to us.”

Now however all these plans are currently on hold.

On the markets, Hashim says this year and next will remain challenging, with any pick up only likely in 2017.

 

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