HGK seals charter and newbuilding deal with steel specialist Salzgitter

HGK Shipping and Salzgitter Flachstahl, a subsidiary of Salzgitter AG (SZAG), one of Germany’s leading steel and technology groups, signed a time charter agreement to lease three dry goods vessels on a long-term basis.

The shipping company based in the German city of Duisburg will become partner for the inland waterway shipping operations of Salzgitter Flachstahl.

The deal also involves a newbuild vessel designed to meet the requirements of the Salzgitter Group and cope with the western German canal region.

“Salzgitter Flachstahl is using this development to secure itself access to transport capacity and is underlining its clear commitment to inland waterways,” HGK said in its statement.

The development follows a memorandum of understanding between HGK and two subsidiaries of Salzgitter AG (SZAG) – Salzgitter Flachstahl and DEUMU-Deutsche Erz- und Metall-Union, signed in August this year.

Salzgitter Flachstahl will coordinate and manage the operations of the three time-charter vessels from HGK Shipping’s existing fleet within SZAG.

The units will be used for alternating services between the Salzgitter business sites and its customers in the Netherlands and Belgium, transporting raw and input materials for steel manufacturing.

The fleet that will be used is due to be replaced by new shipping space in the medium term.

HGK Shipping will place the order for the first new vessel, which will probably go into service in July 2025, in the very near future.

Florian Bleikamp, head of chartering Canal/Rhine at HGK Dry Shipping, said: “We’re resolutely continuing to pursue the goal of achieving climate neutrality in conjunction with the Salzgitter Group. Shifting more traffic to inland waterways as well as developing and using modern shipping space are important steps along this journey.”

Fabian Gerdes, head of customer logistics at Salzgitter Flachstahl added: “Inland waterway shipping is a very important element in our logistics strategy. It is ideally suitable for closed-loop traffic on long routes because the vessels can be used in such a flexible way. At the same time, we believe that there’s free capacity and growth potential on European waterways.”

“However, this is being inhibited by an increasing shortage of shipping space and the obsolescence of fleets along the western German canals. We’re therefore delighted that we can continue expanding our partnership with HGK Shipping here and together invest in modern shipping space and safeguard transport capacity in the long term,” Gerdes said.