Oman Shipping Company is looking to expand the capacity of its dry bulk cargo business in order to meet the demands of the growing mining industry in Oman, says Tae Kown Kim, General Manager, Bulk Dry. Excerpts from an interview
Can you update us on the recent developments at Oman Shipping Company’s dry bulk operations?
Oman Shipping possesses a wide variety of ships and high-end vessels, such as the main, large crude oil tanker and liquified gas carrier and four of the world’s largest dry bulk cargo ships, which in total have 1.6 million tonnes of iron ore cargo carrying capacity per shipment (each vessel has 400,000 MT carrying capacity per shipment). We are proud to own the largest vessels in the world, not just one, but four.
Oman Shipping carries 690,000 MT alumina cargoes from Australia to Oman yearly, using two long-term chartered vessels with a carrying capacity of 55,000 MT each per shipment. What’s more, we carry various types of mineral cargoes from Oman and the region, such as gypsum, limestone, aggregates, iron ore in pellets and fertilizers – based on short to long-term contracts. We are well-known in the market as a responsible carrier transporting large shipments for both import and export trade for dry bulk cargoes, from the Arabian Peninsula and India to Southeast Asia and the Far East.
What about your dry bulk expansion plans for the year 2019?
In line with the Asyad Group Vision 2040, Oman Shipping plans to diversify its business and expand from the limited dependence on oil and gas. In this way, we believe that Oman Shipping will become the leading carrier of Oman’s growing export cargo, and as Asyad has put it, be ranked as one of the top 10 global logistics companies in the world.
One of the major milestones of this great vision is to expand the capacity of our Dry Bulk cargo business in order to meet the demands of the growing mining industry. A recent business strategy meeting has formed a plan to increase the capacity of tonnages in the next five years. This will first involve increasing our owning asset up to eight vessels and increase the cargo market share in Oman by more than 30 per cent.
Ultimately, our goal is to develop our capacity as an integrated logistics solution company under Asyad Group. This will be realised not only through sea freight for exporters, but also by using the capacity of port and maritime transport at a competitive price with a comprehensive logistics solution. One of the main ways we will be increasing our competitiveness is by improving both the quality and quantity of the export of Oman’s mineral resources. We will secure ships by owning a number of vessels, and at the same time, we will charter a few vessels for short, medium and long-term periods, calculating the right balance. Additionally, there will be a greater focus on cargo with shippers from Oman and the Middle East by way of consolidation.
How is OSC going to tap the potential in Oman’s mining industry and manufacturing sector?
Oman undoubtedly has a huge reservoir of mineral cargoes. According to our statistics, Oman has exported in total over 24 million tonnes of general cargo last year. With the rapidly growing demand for the mineral resources from the surrounding countries, it is reasonable to expect that the cargo export volume of Oman will increase exponentially.
Oman Shipping is committed to providing a long-term, competitive and reliable transport service for many of Oman’s mining companies and queries while tailoring to their needs.
How will we provide such a service? Currently, for mining and related companies in Oman that would like to transport a wide range of cargo to a number of countries, there exist only short-term contracts, which are variable in prices. We will provide them with a better offer with lower freight and long-term contracts to transport their cargo to the desired location, by owning or chartering long-term vessels and optimising the unit price. In the long-run, this will form an integrated logistics service with mining companies who will also benefit from our tailor-made logistics packages. OSC will gain competitive advantages from our established reputation as a long term investor and partner to our existing clients. Moreover, we will be able to reduce costs through our long-term strategy adopted by agility and resilience of capacity, it is also expected to increase market-leading capability through quantitative growth and through a quick-return policy.
To put it simply, OSC’s goal is to maximise the market-leading capability of the region. We are confident that we will be the best and the first choice for our dry cargo customers in Oman.