COSCO Approves Fifteen Newcastlemax Bulkers Worth 7.9 Billion Yuan
COSCO Shipping Development has approved an order for fifteen Newcastlemax bulk carriers of 210,000 tonnes capacity each, to be built at two Chinese shipyards for a total contract value of 7.92 billion yuan, around 1.1 billion dollars. It is one of the largest single dry bulk commitments of the year and comes with a twenty-year charter already attached, a structure that removes most of the market risk from the transaction before the first steel is cut.
The ordering entity is not a conventional shipowner. COSCO Shipping Development sits within the wider COSCO group and is involved in financing and leasing vessels and containers, ordering ships, retaining ownership and chartering them out on multi-year terms to the companies that operate them. Ten of the fifteen vessels will be built at Shanghai Waigaoqiao Shipbuilding, part of the China State Shipbuilding Corporation group, with the remaining five at Nantong Xiangyu. Each ship is valued at 528 million yuan before tax, and the company intends to fund a quarter of the investment from its own resources with the remaining three quarters covered by bank loans.
Deliveries are scheduled for 2030, with the Nantong Xiangyu units to be transferred between May and December of that year. All fifteen vessels will be constructed for subsequent conversion to methanol or ammonia propulsion rather than being delivered as dual-fuel ships. That approach preserves the option to change fuel later without committing now to a technology choice that remains genuinely uncertain, and it is becoming a common compromise for owners ordering long-lived tonnage into a regulatory environment that has not settled.
After delivery all fifteen ships will be chartered for twenty years to Wai Fung Shipping, which is owned by COSCO Shipping Bulk. The maximum annual charter rate for each vessel has been set at 59.4 million yuan before tax, a figure that also incorporates the potential cost of the later conversion to dual-fuel operation. COSCO Shipping Development remains the owner throughout, with Wai Fung responsible for commercial and technical operation.
Vessels of this size are used primarily to carry iron ore from Brazil and Australia and coal from Australia to customers across Asia, trades in which the group is already a dominant participant. The contracts form part of a broader replacement and expansion programme under which COSCO has recently concluded agreements covering dozens of new dry bulk ships, steadily renewing a fleet whose older units face rising compliance costs under tightening emissions rules.
