Mozambique Logistics: Vale diverts its coal exports to Nacala-a-Velha terminal

Vale Mocambique SA, the largest coal exporter company at Beira Port, has decided to switch all its exports to Nacala-a-Velha leading to decline by more than half of mineral exports via central Mozambican port of Beira.

In fact, giant Brazilian miner Vale started handling coal exports via Nacala-a-Velha terminal since January 2016, while the largest single shipment of coal from Nacala-a-Velha was a ship carrying 187,000 coal tonnes.

Interviewed by the independent television station STV, Jan de Vries, the chief executive officer of Cornelder de Mocambique, the company that operates Beira port, said the initial forecast for 2017 was that Beira would handle five million tonnes of coal. But the latest prediction is that only two million tonnes will be exported through Beira, entirely.

This was to be expected. Vale had invested heavily in a new railway from the Moatize coal basin in Tete province to Nacala via southern Malawi, and in a new custom-built coal terminal at Nacala-a-Velha.

One of the main advantages of the switch is that Nacala Bay is a natural deep-water harbor that does not require dredging and so can accommodate ships of any size, while Beira requires regular dredging.

The Nacala coal terminal is linked to a railway line linking Moatize to the coastal port on the Indian Ocean, which passes through neighboring Malawi, with an approximate extension of 900 kilometres.

“We are in a difficult situation since Vale Mozambique has opted for the exclusive use of the northern corridor”, said de Vries. “We just have the other two mining companies (Jindal and ICVL of India), and as a result, the amount of coal handled in Beira has fallen by more than half”.

The construction of both the terminal and particularly the railway line, which started in 2012, cost about US$4.5 billion and included the construction of some new sections as well as the reconstruction of others in both Mozambique and Malawi.

The line is owned by CLN, a partnership between the Mozambican ports and railways company CFM, Vale Moçambique, a subsidiary of Brazilian group Vale and Mitsui & Co, of Japan.

Mozambican daily newspaper Noticias reported that after the inauguration scheduled for Friday, at least 21 trains will run on that line on a daily basis at one to two hour intervals.

Metallurgical coal, as well as thermal coal extracted in the mines of Moatize, is destined for the markets of Brazil, China and Japan and, to the inauguration date, about 6.5 million tonnes had already been exported through Nacala. The target is to reach 18 million tonnes per year, which is the installed capacity of the port and the railway line.

Currently, the Beira access channel is only 5.5 metres deep which limits access to ships of no more than 30,000 tonnes. With the dredging to be conducted, ships of up to 60,000 tonnes will be able to berth at Beira.