South Korea's HMM has announced that it has signed a long-term bulk shipping contract with Brazil's Vale, valued at 4.7 trillion Korean won (approximately US$3.4 billion).

According to a regulatory filing submitted by HMM, the contract was signed on September 8. HMM will deploy eight bulk carriers, each with a contract term of 25 years starting from 2030, with freight payments to be made within 10 working days after the completion of each voyage. This marks another major long-term partnership following two 10-year contracts totaling 1.0665 trillion Korean won signed between the two companies in May and September of last year.

HMM placed an order in June this year for eight 210,000-ton bulk carriers to fulfill this contract, with the vessels scheduled for phased delivery from 2030 onward. The newbuilds will be equipped with the world's first tri-fuel propulsion engines capable of running on methanol, ethanol, and heavy fuel oil, while also featuring design provisions for future conversion to liquefied natural gas (LNG) and ammonia fuel. Additionally, they will be fitted with wind-assisted propulsion systems such as rotor sails to enhance fuel efficiency and reduce carbon emissions.

This order is seen as a significant achievement in the reform of HMM's bulk division under CEO Choi Won-hyuk, who took office at the end of March last year. While strengthening the company's core container shipping business, Choi has focused on optimizing the bulk fleet structure by reducing short-term chartering, which is vulnerable to spot market volatility, and expanding long-term contracts with major global shippers to build a stable base of recurring revenue. As a result, the profitability of HMM's bulk division has rebounded markedly since the fourth quarter of last year, generating approximately 240 billion Korean won in operating profit in the first half of this year alone.

An HMM official stated that this contract once again demonstrates the company's strength in partnering with major global shippers, and that HMM will continue to increase the proportion of long-term contracts and reshape its business portfolio to solidify a stable earnings base, while advancing business development in high-value-added and future-growth areas.