Vale taps HMM’s methanol-capable newbuilds for iron ore shipments

Brazilian mining firm Vale has entered a long-term shipping contract with South Korean shipping company HMM for transportation of iron ore.

IMAGE: HMM's vessel currently under construction. HMM

As part of the new contract, HMM ordered eight 210,000-dwt bulk carriers in June, with deliveries scheduled to begin in 2030.

HMM will transport iron ore starting in 2030, with a contract term of 25 years for each vessel, it said. The deal is valued at about KRW 4.7 trillion ($3.5 billion).  

The bulk carriers will be capable of running on methanol, ethanol and conventional marine fuels, HMM said.

Methanol and ethanol share some technical characteristics that make the use of both fuels plausible.

Methanol, which has a flash point of around 11-12°C, and ethanol, with a flash point of around 13°C, are both alcohols with low flash points and are liquid at ambient temperatures. Their low cetane numbers mean combustion requires a small amount of pilot fuel, typically diesel, for ignition.

However, the two fuels do not behave identically in operation. Engines must therefore be specifically calibrated for ethanol use, with adjustments to fuel injection systems, ignition timing and operating temperatures. A methanol-capable engine cannot automatically switch to ethanol unless its fuel-handling and safety systems are compatible.

The new vessels will be fitted with wind-assisted propulsion systems to maximise fuel efficiency and will have options for future ammonia and LNG retrofits, HMM said.

The latest contract marks HMM's third long-term deal with Vale, following two 10-year contracts signed in May and September 2025, the shipping company said.

By Aparupa Mazumder

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