Industry Overview

The bulk shipping industry provides the vital artery in the global supply chain. The transport of raw materials and minerals, together with energy in the form of crude oil and refined products, can only be effectively carried out by the economies of scale afforded by ocean going bulk carriers and tankers. With the sustained growth from the developing Asian economies for both raw materials and energy, sea borne trade will grow and the business of Wah Kwong Maritime Transport Holdings Ltd is to provide ocean going transport and management services to meet that demand.

Shipping adds value to commodities - iron ore delivered to a steel mill or crude oil delivered to a refinery is worth much more than when it comes out of the ground.

Bulk shipping clearly differentiates itself from the container shipping sector, which is based around the transport of manufactured goods in unitized form. Container shipping, particularly the trans-pacific and Asia-Europe trades are heavily dependent on sustained demand for imported goods from Asia and are thus more susceptible to any downturn in the U.S./Eurozone economies. Bulk shipping, by contrast, is more geared to the supply of raw materials for the steel industry, infrastructure and heavy industries such as shipbuilding, together with coal, crude oil and oil products to meet energy demands, hence the growth in earnings and profitability of bulk shipping companies is inextricably linked to continued economic growth, which in recent years has been driven by Asian, and particularly Chinese, demand.