Japanese shipping company Nippon Yusen Kabushiki Kaisha (NYK) has signed a 23-year iron ore shipping contract with Chinese steelmaker Wuhan Iron and Steel (Group) Corporation (WISCO). This is the first long-term deal between the two companies.
Under the agreement, a total of around 52 million mt of iron ore mined in Western Australia will be shipped to Beilun port in China's Zhejiang Province. Shipments will begin towards the end of this year. For the first three years of the contract, NYK will provide this service by using its existing bulk carriers. Subsequently, however, an iron ore carrier with capacity of over 230,000 mt will go into service for the transport of this ore.
In 2006, WISCO produced 13.76 million mt of crude steel and is currently China's fifth-largest steelmaker. WISCO plans to increase its production volume to 50 million mt by 2012.