Chongqing: Among thousands of old ships on China’s Yangtze River, Zesheng Shipping’s modern tankers in eye-catching yellow and red colors are not difficult to spot. The company currently is the leading petrochemical shipping firm on the river.
Ren Zeyou, general manager of Zesheng Shipping, started his career as an apprentice on a ship in the 1980s and later started to operate shipping business with chartered ships on Yangtze River in the 1990s. He started Zesheng Group with his brother in 2003 with only one self-owned 2000 dwt chemical tanker and by 2008, the company’s fleet had grown to 29 vessels.
In 2008, Zesheng Group and the logistics arm of China National Aviation Fuel (CNAF) started a 50/50 joint venture Chongqing Zesheng Shipping. With support from its state-run partner, Zesheng Shipping has become one of the top names on the Yangtze River the and the only aviation oil shipping company in Southwest China.
Its fleet has grown from 29 vessels to the current 62 vessels in the past five years. Total shipping capacity has also grown from 85,000 dwt to 300,000 dwt. The company’s profit has also kept an average annual growth of 20% in the period. According to Ren, currently the company has another four vessels on order.
“The demand for aviation oil Southwest China has been increasing thanks to the fast growing aviation industry in the region. Most of the aviation oil is transported from Mid-eastern China via inland rivers, however, CNAF didn’t have its own shipping capacity at the time and most of its oil was shipped by chartered ships which created lots of risk for them,” Ren explains the background of Zesheng Shipping.
“CNAF has market advantage and finance advantage and we have advantages in shipping fleet management,” Ren says, adding that Zesheng provided shipping safety and professional guarantees to CNAF and increased its supply capability in the region.
Ren is optimistic about the petrochemical shipping market on the Yangtze River, “With more petrochemical projects to be developed along the river, we are quite confident about future prospects,” he says.
Zesheng has also formed long term strategic partnerships with several large scale companies including Sinopec, PetroChina, Pengwei Petrochemical and Kingboard Chemical Holdings.
“We are still facing a series of challenges including a more competitive market and a worsening environment,” Ren says.
In order to promote environmental protection on the Yangtze River and keep the sustainable development of the company,
Zesheng Group and its partner CNAF established another joint venture Zesheng Tanker Cleaning Company which provides green tanker cleaning solutions.
“Tanker cleaning for each vessel will create about 100 tons of waste water, it would be a serious pollution if the waste water is not treated well,” Ren says.
The company aims to expand its fleet to 83 vessels in the next three years and gradually expand its business to domestic coastal market and start river-sea coordinated transport services. [20/06/14]