It is reported that Brazilian mining powerhouse Vale, which has a stake in three Central Queensland coal mines is taking on BHP Billiton in a battle to lure some of the company Chinese iron ore customers.

Vale will spend USD 52 million to build a second floating iron ore transfer station in Subic Bay off the Philippines coastline. These ports have no connection to land, but allow Vale to unload its fleet of iron ore-laden ships the largest in the world on to smaller and faster ships.

The plan is to have its armada of Valemax vessels shipping massive amounts of the mineral which can then be split up and speedily delivered to Chinese ports.

One of BHP Billiton competitive advantages is that Australia's closeness to China means it pays less for freight so the Chinese pay less for its coal and iron ore. This is Vale's way to challenge that.

The new floating stations are mobile enough to be moved to wherever is necessary.

According to Vale, the Valemax ships will take minerals from Brazil 85% of the way before being put onto smaller ships that will travel the remaining distance.

Vale said in a statement that "Both the existing station and the one to be built are mobile, making it possible to move them to operate in different offshore regions. They will be always close to our main consumer markets in Southeast Asia and other parts of Asia."

A spokesman for BHP Billiton said it was inappropriate to comment on a competitor's activities.

Source -Thechronicle

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