Organisational Profile

In this section:

Introduction Swire Shipping Swire Bulk Swire Bulk Logistics
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The China Navigation Company Pte Ltd (CNCo) is the wholly owned deep-sea ship-owning and operating arm – and oldest operational entity – of the Swire group.

Organisational profile

CNCo was founded in 1872 to operate Mississippi-style paddle-steamers on China’s Yangtze River. Since then the Company has expanded globally. CNCo is one of the oldest independent British shipping companies still managing its own tonnage in-house.

CNCo is a Singapore-registered company and is a wholly-owned subsidiary of The China Navigation Company Limited, registered in London. Neither company is publicly quoted on any stock exchange. As can be seen from the Organisational and Operational Boundaries diagram, The China Navigation Company Limited is also the parent company for a number of agencies and has branches and regional offices in Australia, Canada, China, Fiji, Hong Kong, India, Indonesia, New Caledonia, New Zealand, Papua New Guinea, Samoa, American Samoa, Taiwan, United Kingdom and United States of America.

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CNCo also owns:

  • 50% shares in Swire CTM Bulk Logistics Limited, a joint venture with C Transport Maritime SAM registered in Monaco;
  • 25% shares in Mandarin Shipping Limited registered in Hong Kong;
  • 67% shares in Quadrant Pacific Ltd, a joint managing shareholdership with Ahrenkiel Shipping;
  • 25% shares in Mitrabahtera Segara Sejati (MBSS) in Indonesia;
  • 60% of Guadalcanal Travel Services; and
  • 50% of TradCo Shipping in Solomon Islands.

Pacifica Shipping (Pacifica) is an operating division of The China Navigation Company New Zealand (NZ) Limited. Pacifica operates MV Spirit of Canterbury, a New Zealand-flagged coastal container ship. CNCo also owns the New Zealand coastal cement carrier MV Aotearoa Chief; this is operated by The China Navigation Company NZ Limited.

Polynesia Line Ltd. (Polynesia Line) is owned by CNCo. Polynesia Line operates a shipping network from the United States to the Pacific Islands, offering a fortnightly service from Los Angeles and Oakland to Tahiti, Tonga, Samoa and American Samoa and the wider Pacific. Polynesia Line operates two chartered-in vessels: MV Polynesia and MV Cap Taputapu.

The Company operates a global network of multipurpose liner, dry bulk and bulk logistics services through its three business divisions: Swire Bulk, Swire Bulk Logistics and Swire Shipping.

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Swire Shipping

As a multipurpose liner shipping specialist, Swire Shipping has an unrivalled reputation for service, operational excellence and reliability, and is equipped to handle breakbulk, containerised, refrigerated and bulk cargoes, connecting over 400 ports globally.

It maintains a worldwide agency network in addition to its own representative offices across Asia Pacific, the Pacific Islands, North America and Europe, providing its customers with dedicated service and expert market knowledge. At the end of 2017, Swire Shipping owned 23 multipurpose vessels and had chartered-in tonnage with a total of 30 vessels supporting our liner trades.

Divisional update: Swire Shipping

In an increasingly competitive market, Swire Shipping focused on optimising its network in 2017 to ensure customers continue to receive the highest possible service levels and schedule integrity.

Major service enhancements were launched on routes from North Asia to South Pacific, as well as the Trans-Tasman trade between Australia and New Zealand. Swire Shipping also launched a weekly service connecting Asia with Guam and Saipan.

Preparations were also made in 2017 for the commencement of a new office in American Samoa (Pago Pago) where Swire Shipping and its affiliate company Polynesia Line, have been previously represented by a joint venture agency business. The opening of a new office is in line with Swire Shipping’s business model to operate close to its customer base, which also resulted in new offices opening in Fiji and Samoa in 2016.

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Swire Bulk

Swire Bulk operates a rapidly expanding global fleet. A large, modern fleet provides greater flexibility, the surety of supply and a consistent technical standard to perform large volume freight contracts.

Swire Bulk is represented in seven offices around the world - London, Melbourne, Miami, Shanghai, Singapore, Tokyo and Vancouver. It operates an average fleet size of 90 handysize vessels on the water at any one time. Despite the challenging trading conditions, Swire Bulk continues to expand its footprint and market presence in tandem with a strategic newbuilding programme that will deliver the largest and most eco-friendly handysize fleet trading today.

At the end of 2017, Swire Bulk owned 24 modern Swire B.Delta39 handysize bulk carriers, four Imabari38 loggers, three “Green Dolphin38” handysize bulk carriers and had a number of chartered-in vessels. In 2017, Swire Bulk traded an average of 90 vessels.

Divisional update: Swire Bulk

Vessels / Fleet
2017 saw the successful completion of negotiations for eight Oshima 37k DWT vessels and two Hakodate 34k DWT vessels. These are scheduled for delivery in 2020 / 2021. The vessels are a TIER II design and incorporate the new super-eco design features which will expand our fleet and enable them to continue to be the market leader by DWT and efficiency in the handysize sector.

People / Places
The shore-based Swire Bulk team increased its headcount by 25% to 62%. This will allow adequate resources to trade a fleet of up to 120 vessels, in line with our strategic forecast by the end of 2020. The regional offices have been bolstered with the introduction of new Chartering Managers in Miami and Melbourne; while the Vancouver office was established at the end of 2017 and has a mix of internally transferred personnel and new hires.

The global presence across seven offices delivers improved coverage of the market and time zones. This in turn generates improved access to our customers and cargo volumes, offering a more robust cargo platform to expand the Swire Bulk fleet.

Customer development
In 2017, there was greater diversification across both customer accounts and types of commodity. Logs remain a core component of the Swire Bulk business plan. However, there has also been natural growth in other markets and new trades, on the back of the expanded global footprint across 2017.

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Swire Bulk Logistics

Swire Bulk Logistics is the industrial shipping division of CNCo. Deploying purpose-built vessels, Swire Bulk Logistics specialises in the handling of dry bulk materials at sea, through floating transhipment vessels, and intermediate supply chain solutions to provide value-added services for our customers in the Asia-Pacific region. Working together with Swire Bulk and Swire Shipping, the division offers horizontally-integrated services and a global network to provide innovative and sustainable marine supply chain solutions for our customers through long-term partnerships.

Swire Bulk Logistics owns and operates a purpose-built cement carrier, MV Aotearoa Chief, in Auckland, New Zealand, in a long-term partnership between CNCo and Golden Bay Cement, a division of Fletcher Building Limited.

Divisional update: Swire Bulk Logistics

MV Aotearoa Chief, the first cement carrier in CNCo’s fleet, on charter to Golden Bay Cement from December 2016, successfully completed her first year of operation in New Zealand in 2017. The vessel has a carrying capacity of 9,000 tonnes, the equivalent of over 350 road tankers being taken off the roads on each voyage and incorporates the latest technology in electronic engine management, providing optimum fuel efficiency and low emissions.

In Indonesia, the raising of coal prices led to Indonesian coal producers responding accordingly by increasing the production by 6.2% to 434 million tonnes, although these increases have not yet translated to a significant increase in freight rates due to excess logistics capacity in the market.

Amidst these conditions, MBSS, in which CNCo has a 25.68% stake, continued to implement various initiatives to improve its safety and operational excellence, implementing cost efficiency and streamlining its organisational and business processes to increase productivity.

In MBSS, safety continues to be the top priority and an on-going journey. MBSS incident statistics have showed a remarkable improvement. Thanks to the ‘boots on deck’ on-board safety training for the crew, the number of incidents reduced by 10% year-on-year (y-o-y) while the Total Recordable Incident rate decreased by 24% y-o-y to 2.62%. MBSS places strong emphasis on protecting the environment and MBSS’s bespoke, on-board training programmes reinforce this message.

Commercially, MBSS acquired several new clients on long-term contracts towards the latter part of the year and also renegotiated some contracts from spot charter to time charter basis. Several assets were deployed to assist a leading global company on salvage projects; and parlayed MBSS’s technical asset management capabilities into asset management services for one of the clients, both of which delivered new revenue streams for the Company.

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Above: MV Aotearoa Chief in Portland. Credit: Martin Budz.


CNCo's shipping coverage

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