Located about 120 km directly south of Fuzhou, the capital of Southeast China’s Fujian province, Luoyu Port is a bit of a disappointment by the look if you have visited other raw materials berths such as Qingdao in East China’s Shandong or Caofeidian in North China’s Hebei province, To be fair, though, those ports have been in business for long while Luoyu is just a new comer.

This new comer, nevertheless, is holding onto a big dream, as a group of over 30 local and international visitors Mysteel’s 2019 Steel Value Chain Derivatives Summit set foot on the port on November 1 on the invitation of Fujian Luoyu Port Development Co (Luoyu Port) under the stated-owned Fujian Province Communication Transportation Group (FJCT).

The port, about 180km south of Fujian’s Xiamen where the conference was held is connected with a bridge from the mainland, as the Luoyu Port is located on an island in Meizhou Bay, which empties out into the Taiwan Strait, and is dedicated to handling only iron ore and coal for now, according to the port officials who accompanied the guests.

The port bureau, nevertheless, is open to other business opportunities should some traders want to lease space to store goods other than iron ore and coal, the officials added.

Construction was commenced in February 2010 and eventually the port will host 15 berths across 4.7 million square metres with a throughput for bulk commodities designed at 117 million tonnes/year, according to the plan.

The first-stage construction comprising terminals 9 and 10 for iron ore was completed in December 2017 with the former to boast a 15 million t/y throughout and the latter 6 million t/y.

Officially opened for business in August 2018, Luyu is operating berths 8 and 9 while No.10 has yet been into operation, and No.1-7 berths are still under construction when visited by the conference delegated, and iron ore, as designed, will be the dominant commodity but among the seven berths still under construction, one or two will be for coal including thermal and coking coal annually, accounting for 15%-20% of the total ultimate throughput.





No.8 and No.9 storage sites

Parts of the island’s original terrain are still visible above the stacker-reclaimers and unloaders, but just as elsewhere, some of these are likely to be bulldozed into the bay to reclaim more land for the port expansion.

Geographic advantages of Luoyu

As a hub for water-borne freight, Luoyu Port is ideal. Being located south of the Yangtze River Delta, north of the Pearl River Delta, and facing the Taiwan Strait, the port is a perfect conduit to the large-sized steelmakers in these areas, allowing deep-sea vessels to tranship cargoes onto smaller carriers to continue the journey to Chinese river to reach out inland mills, or along the coast to those mills in North or South China.





The location of Luoyu port. source: Google Map

For instance, Luoyu Port is capable of transporting iron ore through sea-rail transportation solutions to steel mills such as Nanchang Special Steel and Jiangxi Fangda Steel Group in Jiangxi province, East China, and with its transhipment, it will also be able serve the steel mills in the lower- and middle reaches of the Yangtze River, such as Baoshan Iron and Steel and Jiangsu Shagang Group outside Shanghai, the port officials proudly presented the possible reach-outs to the delegates.

The port’s first shipment of iron ore, a 250,000DWT carrier laden with Australian ore, arrived at the No.9 terminal on August 24, with the buyer being Beijing-based iron ore trader Ruiganglian Group on behalf of a steelmaker in Jiangxi province, Mysteel Global understands.

The vessel size is of significance too. As part of a broader expansion of ports in and around Meizhou Bay, China has embarked on an ambitious program of deepening waterway around the area to allow dry bulk carriers of 50,000-400,000 DWT to navigate safely and smoothly through the bay, which means that the water depth around the port should be 15-20 metres, the deeper, the bigger vessels.

Other than the steel mills in mainland China, Luoyu, with its perfect location, is also able to entertain customers across the Strait.

“Customers in Taiwan have stored some of their iron ore at our berth this year, as the storage capacities at the ports in Taiwan are relatively small,” a port official shared with the visitors.

China Steel Corp, the largest steel mill in Taiwan, has its fully-owned Dragon Steel operate two blast furnaces in Taichung, Taiwan, which is about 200 kms east of the port, around the same distance as some mainland steel mills, and China Steel’s primary Kaohsiung works in South Taiwan is slightly further, about 350 kms southeast of Luoyu, Mysteel Global notes.

Quietly, Luoyu port has also been picked by the world’s top iron ore miner Vale as a blend and distribution centre for its business in Southeast China, as the port is able to handle the giant 400,000 DWT Valemaxes, and so far, Vale has blended and stored over 1 million tonnes of fines including Brazilian Blend Fines and Carajas Fines at the very port, and mainly at the No.9 berth.

No. 9 is the largest iron ore berth in the coastal area of Southeast China and is designed for vessels up to 300,000 DWT, though it can accommodate the Valemaxes with ease too, the port official shared with pride.

Well-designed and developed construction

Luoyu Port, being a late comer to the competition among the Chinese ports, has the benefit of a well-designed development blueprint, consisting of railways, water transit, and truck transportation, enabling it to have around five trains and 200-250 trucks in and out of the port, according to the official.





The bridge in the foreground is for rail traffic, the bridge in the background for truck transportation.

As for the facilities, the port has been installed with more than 400 cameras on the work-sites to monitor all the uploading, discharging and handling equipment 24 hours seven days, and currently, the port is debugging an unmanned operating system. Already, a bucket wheel stacker and reclaimer can currently mix around 200,000 t/y of iron ore automatically with no human beings around.





Left: remote control room; Right: Control room for unmanned operations

Efficiency has also been met with “green” concept here in Luoyu with the growing consciousness of environmental protection in Chinese steel industry.

On the day of the visit, autumn winds were buffeting the sprawling complex and the delegates could see that small hills of iron ore in the stockyards covered with cloth to minimize dusting, and those stockpiles without covers were being water sprayed with automatic watering system.

On top of all these, Luoyu has built a suppression wall between the dockyards and stockyards. “We have even installed some air quality monitors, and the alarms will go off when the particles in the air hit unhealthy levels,” the official explained.





The dust suppression wall.

Other than the visible efforts, Luoyu has also built a closed-loop drainage system to filter and recycle all the industrial waste water filtered instead of just pumping them into the sea to cause marine pollution, the port official shared.

At this explanation, a visitor from Xiamen port admitted enviously that Luoyu Port is more advanced than theirs in terms of nature protection. “We still need to spend more time and investment in improving our environmental facilities,” he said.

Just the start

As a newly-established modern raw materials hub, Luoyu Port still has a long way to go to grow its port business, but in the past 16 months, it has certainly fared well with from a solid starting point, and all the facilities and designs are really rather promising for a prosperous business, as the port layout and construction seem defect-free, and all the automation system will make it easy to operate at a highly-efficiently and eco-friendly rate with few human resources needed.

China is in the middle of relocating its steel capacities to coastal lines along the eastern and southern regions, and with Luoyu, a still unknown port as the pioneer, it seems very achievable for ports of similar size to copy the success model or even perfect what Luoyo has achieved so far.

Written by Zhiyao Li, lizy@mysteel.com

Edited by Russ McCulloch, russ.mcculloch@mysteel.com







