Vale, the world’s largest iron ore producer, said it proposed to borrow $1.23 billion from two Chinese lenders to finance the construction of 12 ships, taking advantage of falling borrowing costs, Exim News Service informs.

The 13-year loan will be disbursed over three years. The loan from the Bank of China and the Export-Import Bank of China will cover 80 per cent of the cost of the project, Vale said.

The ships will be used to transport iron ore to China from Brazil. The deal marks yet another sign of growing commercial ties between the two countries.

Each ship will be able to carry 400,000 dwt of ore. Deliveries are expected between early 2011 and the end of 2012.

Source: Transport Weekly