Indonesia’s Asia Pulp & Paper (APP) Sinar Mas has become a shipowner with orders for up to four woodchip carriers in China.
Jakarta-based APP ordered two firm 70,000-dwt newbuildings at state-owned Chengxi Shipyard. The deal includes options for two more vessels, according to industry sources.
Officials at Chengxi declined to comment, citing contract confidentiality. APP was not available for comment.
APP is said to have signed the contract, which is suggested to be worth around $140m, early this year, but the deal was never reported.
Industry sources said APP had been in contact with shipyards for woodchip carriers for the past few years but only recently firmed up newbuilding plans.
It is believed to be paying around $35m each for the vessels and is due to take delivery of the firm units in 2023.
APP is a subsidiary of Sinar Mas, one of the largest conglomerates in Indonesia. The group's diverse portfolio includes real estate, energy and infrastructure, palm oil production, financial services, agribusiness, telecommunications and mining.
APP is one of the largest pulp and paper manufacturers in the world, with annual production of more than 20m tonnes. It is said to have relied on Japanese owners for its shipping requirements, but this is set to change once it takes delivery of the Chengxi newbuildings.
APP is believed to be second paper and pulp company to have ordered woodchip carrier newbuildings in the past decade.
Singapore's Nova Shipping & Logistics, the shipping arm of Asian resources giant Royal Golden Eagle, signed up for 14 70,000-dwt vessels at Chinese shipyards in 2010.
It booked 10 newbuildings with Yangzijiang Shipbuilding and four at Chengxi Shipyard. The Yangzijiang-built vessels were delivered between 2013 and 2014. Chengxi delivered three woodchip carriers last year. The fourth ship, the Canada Express, was delivered in January.
