Another Chinese krill-fishing vessel project canceled

Published on
January 12, 2022
A krill-fishing vessel being designed by Finnish-based Wärtsilä Ship Design Company looks to have been put on ice by the Chinese company behind the contract.

A krill-fishing vessel being designed by Finnish-based Wärtsilä Ship Design Company looks to have been put on ice by the Chinese company behind the contract.

Wärtsilä was commissioned in 2021 to design a second krill-processing vessel for its client Shanghai Chong He Industry Group (also known as Chong He Marine Heavy Industries Co, or CMI), which described its existing Shen Lan vessel – also designed by Wärtsilä – as the world’s largest purpose-built vessel for fishing Antarctic krill.

“From our side, the project is still kept on hold,” Tomaz Nabergoj, director of ship design at the Finnish firm, told SeafoodSource. “The customer claimed he had to first test the first one. And he did, coming back with a demand for complete redesign of what was initially contracted. But again, no real discussion followed.”

In August 2021, CMI transferred operation of the Shen Lan to distant-water fishing operator Shanghai Kaichuang Marine International Co.

“[This was] linked to the lack of experienced crew available for the operation, alongside processing missteps that delayed the trawler launch,” Dimitri Sclabos, director at Chile-based consultancy Tharos, told SeafoodSource. “CMI's second vessel was dropped. Facing technical and operational complexities on their first one… who wants a second one?”

The apparent stalling of the second Shen Lan ship follows the scrapping late last year by another Chinese fishing firm, Pingtan Marine, of its plans for a new krill vessel. Pingtan's cancelation was blamed by Sclabos on a sharp rise in shipbuilding costs.

Sclabos believes state-owned -and private Chinese fishing firms have been collaborating in order to keep resources in China’s hands – and to make up for a lack of krill expertise. China’s 863 Program, launched several years ago, disbursed state funding to encourage firms to develop krill products, but some of the Chinese firms used the funds to bet on the frothy real estate market, according to Sclabos.

Debt deleveraging remains a priority for Chinese policymakers, who have sought to defuse a debt crisis at leading property developer Evergrande, which threatened to derail the property market that is central to the country’s growth and household wealth.

Several shipyards in China’s competitive shipbuilding industry have been booking or looking for krill projects, according to Sclabos. China’s largely state-run shipyards have come to dominate global shipbuilding and have aggressively expanded into manufacturing of energy and aquaculture platforms.

Photo courtesy of Jiangsu Shen Lan Distant Water Fishing Co.

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