Economy, Domestic Economy

IRISL Returns to the Fold of Int’l Shipping Giants

The fleet Capacity of IRISL is expected to grow 50% in 2018 with the addition of 10 vessels it has ordered from Hyundai Heavy Industries
IRISL Returns to the Fold of Int’l Shipping Giants
IRISL Returns to the Fold of Int’l Shipping Giants

The Islamic Republic of Iran Shipping Lines plans to replace 49 ships with new ones within five years, the technical and commercial director of the state-run company said.

“The company is restoring its pre-sanctions position,” Amirsaman Torabizadeh was also quoted as saying.

He explains that besides domestic capacities, IRISL will cooperate with foreign shipbuilding companies to materialize the plan.

Under a $650-million contract signed last December with IRISL, the world’s largest shipbuilding company Hyundai Heavy Industries Company is to build four 14,400 TEU container ships and six 50,000 DWT product tankers.

Ahmad Shahbaz-Beigi, the deputy head of IRISL Group, said the fleet capacity of the shipping company is expected to grow 50% in 2018 with the addition of 10 vessels it has ordered from Hyundai, Mehr News Agency reported.

  S. Korean, Chinese Finance

Torabizadeh said Chinese and South Korean letters of credit will be used to finance the new vessels it has ordered.

Iran signed its biggest credit line deal in recent years with South Korea’s Eximbank in August. The deal envisages as much as €8 billion in loans provided by South Korean companies to finance various projects in Iran.

Another agreement was signed between China’s CITIC Trust and five Iranian banks in Beijing earlier this month for the company to extend a credit line worth $10 billion for supporting projects in Iran.

IRISL Chief Executive Mohammad Saeedi recently said the company has finalized $500 million in foreign finance for purchasing ships.

“The total value of the finance deal is about $700 million while about $500 million of the required funds will be provided by South Korean banks,” he told Tasnim News Agency.

Torabizadeh said the first new vessels will be imported during the first three months of 2018, expressing hope that the new ships will help the company reclaim its share in international logistics market.

He also announced that IRISL will launch a container shipping line from Asia to Europe and vice versa, Trend News Agency reported.

  Coming in From the Cold

IRISL—once a global shipping power—was severely hit by prolonged anti-Iran nuclear sanctions. The lifting of sanctions has paved the way for IRISL’s resurgence and cooperation with international companies.

IRISL’s container carrier Azargoun called at Belgium’s Antwerp Port in March, for the first time in almost half a decade after calling at the port of Hamburg. The Iranian ship moored at Deurganck dock after departure from Germany’s Hamburg.

The last time IRISL made port calls to Europe was in 2010 through its subsidiary Hafiz Darya Shipping Company, or HDS Lines.

Iranian port activities, which account for a considerable portion of Iran’s foreign trade, increased considerably after Iran signed the nuclear deal with world powers in 2015, which led to the removal of economic sanctions against the country last year.

The ports handled 58.2 million TEU of containers last year, indicating a 162% hike over March 2013-14 after a sharp fall to 1.2 million TEU was registered in 2014-15.

Last year, 9,301 vessels berthed at Iranian ports, which show a 10% increase compared to 2013-14. The number of ships docking at Iranian ports reached its peak of 9,534 during 2015-16.

International shipping lines are increasingly sending their vessels to Iranian destinations that were previously blacklisted by sanctions.

According to Ports and Maritime Organization’s CEO Mohammad Saeednejad, 17 global shipping lines have resumed services to Iran since the removal of nuclear sanctions.

“As a result of the nuclear deal, Iran’s marine activities are now completely back to normal,” the official was quoted as saying in January.

Mediterranean Shipping Company, the world’s second-largest shipping line in terms of container vessel capacity, and Evergreen Line are among top shipping lines that have resumed cooperation with Iranian ports.

France’s CMA CGM, the world’s third largest container shipping group, called at Shahid Rajaee, Iran’s biggest container port at the mouth of Strait of Hormuz, in August 2016. The company teamed up with IRISL to share vessel capacity and jointly operate routes and marine container terminals. It launched a Tehran office this year, appointing CMA CGM Pars as its new agency in Iran as of May 1.

Maersk Line expanded its footprint in Iran by adding a second port of call less than three months after it resumed services to the country following the lifting of sanctions.

The Danish carrier, which suspended services in 2012, added the port of Bushehr to its Iran portfolio in 2017. Its service was relaunched with calls to Bandar Abbas in October last year.

Director of IRISL’s Insurance Brokerage Mohammad Reza Banaei had said in June that 77 Iranian ships are now receiving protection and indemnity coverage from Steamship Mutual Underwriting Association Limited, which was denied during the sanctions as the country has managed to become a member of three P&I clubs.

The 77 insured ships belong to IRISL and its subsidiary, Valfajr Shipping Company. The first shipping company specialized in passenger and cargo carriage in the Persian Gulf and Oman Sea after the 1979 Islamic Revolution in Iran, Valfajr was established as an independent corporate entity in 1989.

The CEO of IRISL said in June that IRISL’s fleet consists of 152 vessels. IRISL Group is currently the world’s 21st largest containership operator with a 96,383 TEU capacity, placing it between the Hong Kong-based shipping lines of SITC (97,675 TEU) and Shanghai-based container shipping company Zhonggu Shipping (91,503 TEU), according to the global shipping monitor Alphaliner’s ranking of top 100 shipping firms.

Maritime transportation accounts for 85% of Iran’s foreign trade. Imam Khomeini and Shahid Rajaee ports in southern Iran account for 80% of the total throughput of Iranian ports.

According to Hamzeh Keshavarz, director general of Container Transportation Company—an IRISL division, the maritime fleet of the Islamic Republic of Iran Shipping Lines handles half of the cargo container throughput in the country.

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