Winning International Group expected to step up chartering in July

Trucks transport bauxite at the Kuantan port in Pahang, Malaysia. Credit: Press Association

Singapore-registered Winning International Group, a major shipper of bauxite into China, told IHS Fairplay that it expects to be more active in the chartering market in July. That is when its bauxite mining project in Guinea, La Soci??t?? Mini??re de Bok??-Winning Africa Port, should begin increased production.

Winning, founded by former Cosco executive Sun Xiushun, used to ship about 50 million tonnes of bauxite annually to China, prior to Indonesia halting such exports in 2014.

At that time, the company had as many as 30 bulk carriers of various sizes on charter at any one time, in addition to its owned fleet.

The Indonesian ban on raw ore exports slashed Winning’s chartering activity, which is handled out of the company’s Qingdao office.

The company’s Singapore registration will enable it to enjoy tax exemptions on income earned from its ships as it has been granted the Approved International Shipping Enterprise scheme from the Maritime and Port Authority of Singapore.

A company executive told IHS Fairplay, “In the last two years, we haven’t been chartering that many ships, as we acquired more vessels. There were also fewer cargoes to carry after Indonesia banned ore exports. However, our mine in Guinea would generate more cargoes from July, so we expect to fix more vessels then.”

Currently, Winning fixes at most three ships at any one time. Since the Indonesian ban, the company has been sourcing bauxite from Australia, India, Malaysia and Guinea.

In January 2015, the Supramax bulker Bulk Jupiter, which Winning fixed from Gearbulk, sank off Vung Tau, Vietnam, after lifting bauxite in Kuantan. It is believed that cargo liquefaction caused the ship to sink but Winning has refrained from commenting until investigations have been concluded.

The Winning executive said, “There are environmental restrictions on bauxite mining in Australia, and the quality of Indian bauxite is low. We think Guinea has the potential to be a major bauxite supplier to China.”

China, being a major aluminium producer, requires 55 million tonnes of bauxite a year.

Guinea is estimated to have 7.4 billion tonnes of bauxite reserves, or 26% of total global supply.

Winning invested 45% in La Soci??t?? Mini??re de Bok??-Winning Africa Port, and the other investors are Weiqiao Pioneering Group and Yantai Port Group.

The mine-and-port facility began its first year of operations in 2015 with 5 million tonnes of exports, and this will be gradually increase to 30 million tonnes, or around 200 Capesize shipments by 2017.

Since bulker asset values depreciated heavily with the Baltic Dry Index’s plunge to a historic low in 2015, Winning has been taking advantage of the situation to expand its owned fleet.

Between January 2015 to February 2016, Winning has purchased and taken delivery of the 2000-built Sunny Sailor, 2006-built Winning Kindness, 2001-built Sunny Boke, 2004-built Winning Loyalty, and the 2009-built Winning Pride. These ships were purchased for USD10 million to USD19 million each.

The company executive confirmed that Winning is in discussions to purchase four more Capesizes, the 2002-built Unique Brilliance, 2009-built Lyla 2006-built Global Partnership and 2011-built Hyundai Trust, for USD5 million, USD18 million, USD12 million and USD22 million, respectively.

The executive said, “We think that this a good time to replace our older vessels with newer ships.” Three of Winning’s Capesizes, 1991-built Sunny Star, 1994-built Sunny Voyager and 1990-built Sunny Ocean, have been sold for demolition.?(Xiaolin Zeng, East Asia correspondent | 12 May 2016, fairplay)