* To award 10-year charter contract to Seaspan
* Vessels likely to be built by South Korean firm
* Yang Ming shares up 1 pct, outperforming main index
By Alison Leung
HONG KONG, Jan 4 Taiwan's government-owned Yang
Ming Marine Transport Corp will lease up to 10 new
ultra-large container ships (ULCS) from U.S.-listed Seaspan Corp
to cut unit costs and weather a volatile global shipping
Set to be delivered from 2015, Yang Ming will charter five
of the new ships for 10 years, with an option to lease another
five, spokesman Winsor Huang said.
"Seaspan has won the tender to provide the new ships and an
agreement is expected to be signed later this month," Huang told
Reuters on Friday.
The vessels of 14,000 twenty-foot-equivalent units (TEU)
each, which will be the first ULCS for Yang Ming, are most
likely to be built by a South Korean shipbuilder, he said, but
declined to provide any details.
A Hyundai Heavy Industries Co Ltd official told
Reuters that the shipbuilder was in talks with Seaspan
concerning the contract but that nothing had been decided.
The market price to build a new 14,000 TEU is estimated at
$100 million to $120 million, analysts say.
Hyundai Heavy has said it aims to win $29.7 billion in
orders this year.
Shares of Yang Ming rose 1 percent on Friday, outperforming
Taiwan's main TAIEX index, which eased 0.5 percent.
The global shipping market is set for another volatile and
low return year in 2013 due to a lingering supply glut, analysts
Macquarie forecasts new vessel deliveries will rise 8-10
percent year-on-year in 2013, while growth in demand for
container shipping is seen remaining weak at 4-5 percent this
Yang Ming's move is positive as it will help lower unit
operating costs, said Bonnie Chan, a shipping analyst at
"This is something they need," said Chan. "Yang Ming needs
to contribute to the alliance in order to make the alliance stay
In the four-member CKYH alliance, China COSCO Holdings Co
Ltd's COSCO Container Lines and Hanjin
Shipping Co Ltd already operate 13,000 and 14,000
After Yang Ming begins leasing ULCS, Kawasaki Kisen Kaisha
Ltd will be the only alliance member with no immediate
plans to deploy ships of more than 10,000 TEU.
Yang Ming, which in December sold a 30 percent stake in its
Kao Ming Container Terminal in Taiwan's Kaohsiung to Chinese
investors for $135 million, says it currently operates container
ships with a total capacity of 359,523 TEU and has outstanding
orders for new vessels of 50,686 TEU.