Bulker company Fuzhou Xinjiahong Shipping of China has exited shipowning after three decades with the sale of its last vessel, a veteran handymax.
Chinese sources told TradeWinds the 45,700-dwt Hong Kai (built 1996) was sold last week to another Chinese owner for further trading. The 24-year-old, Japanese-built ship brought in some $2.6m.
Company officials could not be reached for comment but the sources said the ship is the last in the fleet and the company has no further plans in shipping.
VesselsValue lists another similar vessel in the Fuzhou Xinjiahong fleet, but TradeWinds understands it was also recently sold.
Fuzhou Xinjiahong was owned by Wang Zhihe, who entered the shipping market in 1990. Wang could not be reached for comment.
Local peers shipowners said Wang came to Fuzhou from Fuan in northern Fujian province, working as an official in a local government finance office before making his first shipping investment.
Once in the Fuzhou shipowning environment, he followed the local shipowning model of all-equity investments.
Fuzhou shipowners typically purchase veteran secondhand ships at levels near scrap and operating them intensively with an eye to the ups and downs of the recycling market. Chartering revenues have no ship finance costs to cover, and proceeds from scrap sales typically allow investors to recover the original investment as well as offering the possibility of a significant windfall.
But the model does not appeal to bankers, and Fuzhou owners rarely make the jump to larger and more modern mortgage-financed fleets.
The Fuzhou Xinjiahong fleet was up to seven vessels at one time and it was well positioned to reap the profits of the dry bulk supercycle leading up to the global financial crisis of 2008.
In December 2010, however, disaster struck in the form of an apparent nickel ore cargo liquefaction. In the sinking of Fuzhou Xinjiahong's 50,000-teu Hong Wei (built 2001) in the South China Sea, a reported 10 crew members lost their lives and 16 were rescued.
The Fuzhou Xinjiahong fleet dwindled after that and Wang and his partners gradually diversified out of shipping. Wang himself is understood to be active in real estate investment in Canada.
