South Korea’s largest container shipping company, HMM, has signed a massive long-term shipping contract with Brazilian mining giant Vale worth approximately $3.5 billion. The HMM Vale shipping contract covers eight new bulk carriers, each set to operate under a 25-year agreement beginning in 2030 when the vessels enter service. The deal represents a significant commitment by both companies and underscores the growing importance of long-term shipping contracts in the global iron ore shipping industry.
According to a regulatory filing, the contract is valued at 4.697 trillion won, equivalent to 43.13 percent of HMM’s consolidated revenue of 10.89 trillion won in 2025. The agreement runs from April 1, 2030, through October 31, 2056, with each vessel beginning its individual 25-year contract period upon entering service. Vale also holds an option to extend the arrangement by up to five years beyond the initial term.
Eight Newcastlemax Bulk Carriers With Next-Generation Fuel Capability
HMM had announced in June that it would order eight 210,000-tonne Newcastlemax vessels specifically for this long-term shipping contract. These bulk carriers will feature the world’s first engines capable of running on methanol, ethanol and conventional fuel oil. The ships are also being built as LNG- and ammonia-ready, meaning they can be converted to liquefied natural gas or ammonia propulsion in the future.
In addition to their multi-fuel capability, the Newcastlemax vessels will carry rotor sails designed to harness wind energy and supplement engine propulsion. These features are part of a broader package of equipment aimed at improving fuel efficiency and reducing carbon emissions across the fleet.
Under the terms of the HMM Vale shipping contract, the bulk carriers will transport cargo primarily between Brazil and destinations including China. Payments will be made within 10 business days after loading for each voyage. HMM noted that the final contract value could change depending on exchange rates, fuel prices, shipping routes and vessel operating days.
Third Major Long-Term Agreement Between HMM and Vale
The latest deal marks the third major long-term shipping contract between HMM and Vale. The two earlier agreements, signed in May and September of last year, were 10-year deals worth a combined 1.07 trillion won. The progression from those initial arrangements to the current 25-year commitment reflects the deepening commercial relationship between the South Korean carrier and the Brazilian mining company.
The HMM Vale shipping contract is part of a broader strategic effort by HMM to reduce its dependence on volatile container freight rates. Since CEO Choi Won-hyuk took office at the end of March last year, the carrier has focused on streamlining its bulk shipping fleet, reducing reliance on short-term chartered vessels and securing more long-term cargo commitments with large, creditworthy cargo owners.
HMM’s bulk division posted operating profit of 240 billion won in the first half of this year, extending a sharp improvement that began in the fourth quarter of 2025. The company has also broadened its non-container portfolio beyond conventional dry bulk carriers and tankers into liquefied-gas carriers, pure car and truck carriers and multipurpose vessels. Its bulk fleet expanded to 61 vessels as of the first half of this year from 44 at the end of March 2025.
“HMM will continue strengthening its stable earnings base by expanding the share of long-term contracts and restructuring its business portfolio, while expanding businesses centered on high profitability and future growth,” a company official said.