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China's deep water ports.

In mid-summer 2012 COSCO's 10 largest iron ore vessels were traveling between Brazilian iron ore ports and five discharge ports in China capable of handling vessels loaded to drafts of 19.0-21.7 meters: Bayuquan, Caofeidian, Majishan, Qingdao and Rizhao. These were all giant 298,000-ton vessels. For many years China had only two bulk cargo ports capable of handling bulk carriers larger than 200,000 tons: Ningbo and Qingdao. Now, following several expansions and channel dredging, the ports of Dalian (20.0 meters draft) and Bayuquan (17.7 meters draft) can handle larger-than-Capesize vessels.

Two Very Large Ore Carriers (VLOCs) were allowed to dock in China in 2011. In October, the 364,000-ton MS Berge Stahl, carrying a full load of iron ore landed and discharged at Caofeidian's new iron ore wharf. The 388,000-ton MS Berge Everest was allowed to land and discharge its full cargo at the Port of Dalian in December 2011. However, these were exceptions to the current rule. Restrictions have been placed against vessels larger than 300,000ton until Chinese officials are satisfied it can be done safely. Based on recent announcements the Qingdao sub-port, Dongjiakou, will soon join the ports of Dalian and Majishan as the only ports physically capable of handling the 400,000-ton Valemax vessels.

Chinese steel producers recognize the cost advantage of shipping ore and coking coal in very large vessels, and continue to improve their coastal ports to receive larger vessels. The steel industry is the primary driver for deepwater port improvements, as China receives a high percentage of its iron ore from Brazil in 298,000-ton vessels, and is looking to create more opportunities to use the Brazilian 400,000-ton vessels. While similar expansions are being made for coking coal imports, they tend to be limited to Capesize vessels because world coal loading terminals tend to have that size limitation. All of the new iron ore expansions provide both iron ore and coking coal discharge facilities.

China's Steel Producers

All of the top 10 Chinese steel producers lie along the bank of the Yangtze River or north of its mouth. Two of the deep-water berths (Bayuquan and Caofeidian) targeted by COSCO for mid-summer iron ore deliveries lie in the Bohai Sea, the northernmost waters of China. Other important ports, such as Qinhuangdao, Dalian and Tianjin are also located on the Bohai Sea.

[FIGURE 1 OMITTED]

In Figure 1, the Bohai Sea is surrounded by the provinces of Shandong, Hebei and Liaoning. The ports of Caofeidian and Bayuquan are located at the top of the Liaoning notch, and the Port of Dalian is located at the tip of the Liaoning Peninsula. Qinhuangdao (NOT Qingdao) also lies on the Bohai Sea. Rizhao and Qingdao (Dongjiakou) both lie on the bottom side of the Shandong "thumb." The ports of Ningbo and Majishan lie in northeastern coastal Zhejiang, just a few miles south of Shanghai and the Yangtze River Estuary. Ports that are major exporters of Chinese coal as well as importers of coal include Qinhuangdao, Caofeidian, Tianjin, Huanghua, Qingdao and Rizhao.

Caofeidian--Caofeidian is adjacent to the metropolis circle of Beijing, Tianjin and Hebei Province, a core area of economic development in North China. The water depth in front of Caofeidian is 30 m, and is a natural site for a large berth of 300,000 tons without requiring substantial dredging in Bohai Bay. It is a major Chinese coal export terminal as well as import terminal.

The coal terminal expansion project consists of two 100,000-ton, two 70,000-ton, and one 50,000-ton coal loading berths. The berth length is 1,470 m, and the throughput capacity is 50 million tons. This contrasts with Norfolk Southern's Lamberts Point Terminal in Norfolk, Va., the largest facility in North America for transloading coal from trains to ocean ships for export. Its annual throughput capacity is 48 million tons.

According to Chinese statistics, Caofeidian's iron ore imports reached 80 million tons in 2011. The iron ore terminal expansion project will consist of two 250,000-ton berths. The berth will be 790 m long. Initially, the annual throughput capacity will be 35 million tons, but is expected to eventually reach 100 million tons. Shougang Jintang Iron & Steel officially opened its Caofeidian plant in 2009, being one of those directed to leave Beijing and move to the coast in an effort to clean up the pollution.

Bayuquan--The Port of Bayuquan (a subport of Yinkou Port) coal terminal contains a total berthing distance of 1,800 m and alongside depth of 18 m. Unloading operations can be completed within two hours, and loading operations can be finished within four hours. The 120-hectare company yard has capacity for 3 million tons of coal, with annual turnover of 35 million tons per year. The terminal is served by nine rail lines, and can load/unload 350 cars per day.

The Port of Bayuquan ore terminal contains Berths 16, 17 and 18. Berth 16 has a berthing distance of 340 m and alongside depth of 17.5 m. Berth 17 has a berthing distance of 359 m with alongside depth of 20 m. Berth 18 has a berthing distance of 452 m with alongside depth of 24.5 m.

The ore yard covers 40 hectares and is equipped with a 6,000 ton per hour stacker, a 3,500 ton per hour (tph) reclaimer, and belt conveyors connecting the terminal with the railway. A second ore yard has three railway loading machines with capacity to move 3,500 tph. The Port of Yingkou is building a new ore yard that will bring the ore yard area in the Port of Y'mgkou to 80 hectares.

Dalian--In July 2011, the China Transport Construction Group completed work to expand Dalian's port capacity to 400,000 tons from 300, 000 tons. According to Vale, this brings the total to three Chinese ports capable of handling their 400,000 ton Valemax vessels. The other two are Majishan and Dongjiakou.

The Dalian Port Ore Terminal Co. is located on the Dagushan Peninsula. It is home to dedicated ore loading/unloading berths with alongside depth of 23 m. The 30-million-ton capacity ore wharf is equipped with a 64-ton grab ship unloader that can move 2,500 tph. The ore terminal yard covers almost 92 acres, and has capacity for stockpiling 5 million tons of ore.

Rizhao--Rizhao is a major Chinese coal export terminal as well as import terminal. Shandong Excellence Huitong Energy Company imports steam coal for Rizhao Electric Power, coking coal for the coking plants, and iron ore for Rizhao Steel. They trade coking coal for coke, which they provide to Rizhao Steel under long term contract.

The port has two exclusive coal berths for 150,000 ton vessels, possibly the largest coal berths in China. It also has one berth for 50,000 ton vessels. Annual coal throughput is estimated at 45 million tons. One ore berth can handle vessels of 200,000 tons capacity, and the other can handle vessels of 300,000 tons capacity. Annual iron ore throughput is estimated at 50 million tons.

Central Ports

Not all steel companies can be directly served by deepwater vessels. Five of the top 10 steel producers are located inland along the Yangtze River, which empties into the China Sea on the north side of Shanghai. They are Baosteel, Wuhan, Jiangsu Shagang, Maanshan and Hunan Valin. To reach these facilities with raw materials it is necessary to unload the deepwater vessels at coastal feeder ports and reload the cargo, either coking coal or iron ore, into river barges capable of navigating the Yangtze River. These are not like the 1,500-ton towed river barges used in the U.S., but are individually powered vessels that are much larger, sometimes in the 8,000-ton class. Two of the major deepwater feeder terminals for both coking coal and iron ore are Ningbo and Majishan, both of which lie south of Shanghai.

On the north bank of the Yangtze, 12 miles from the sea, Nantong Port occupies a shoreline of 4.2 km with five major terminals. Together they operate 24 berths, of which 14 berths are for vessels of more than 10,000 tons, including two berths for vessels of 150,000 tons, five berths for vessels of 70,000 tons, four berths for vessels of 50,000 tons, and three berths for vessels of 10,000 tons. Nantong acts as a feeder port for Yangtze River commerce in iron ore, coal and other bulk commodities.

Ningbo---Ningbo (Beilun) is a rare deepwater port having unique natural conditions. Sheltered by the Zhoushan Islands, the port area is free from strong winds and waves. There is no freezing or siltation within the port area. The entry channel is normally more than 30 m deep except for a 4.5 km section that is 18.2 m deep. Large ships up to 250,000 tons can navigate freely, and those of 250,000 to 300,000 tons may come and leave on the tide. Ningbo Port receives the most ultra large ships (greater than 100,000 tons) in China, and is well-positioned as a feeder port to Yangtze River commerce.

Majishan--The Port of Majishan is a large ore transfer base close to the Yangtze River estuary, and is a strategic feeder terminal. It is located on Sijiao Island in Shengsi and covers an area of about 168 acres. While Baosteel of Shanghai has already built a 250,000--and a 300,000-ton ore transfer dock, the construction of the terminal is incomplete. When complete it will handle coking coal as well as iron ore, LNG, liquid chemicals, and may cover as much as 1,000 acres. Because of its extreme depth Majishan is one of the three terminals chosen to accept Vale's 400,000-ton ore vessels when all testing is done. The other two are Dalian and Qingdao sub-port, Dongjiakou.

Fangcheng--Wuhan Iron & Steel Group (WISCO), a Yangtze River steel producer, has received approval from the Chinese government to build a new iron and steel plant in the southern province of Guangxi. WISCO plans to spend $9.5 billion on the new plant, which will be located at Fangcheng Port. The plant will be built to produce 8.5 million tons of iron, 9.2 million tons of steel and 8.6 million tons of steel materials, according to a statement from the China's National Development and Reform Commission. This port is currently the designated Chinese port for the receipt of South African coal.

Author Dave Gambrel is a transportation consultant to the coal business. He wus formerly the senior transportation executive for Peabody Energy Co. He may be reached at bunkgambrel@earthlink.net.
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Title Annotation:TRANSPORT TIPS
Author:Gambrel, Dave
Publication:Coal Age (1996)
Geographic Code:9CHIN
Date:Dec 1, 2012
Words:1781
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