Information from the corporate website indicates tonnage ranging from 1,000 to 6,500 TEUs, but it appears that most of its current fleet is under 5,000 TEUs, according to an article recently published by the American Journal of Transportation.

Negotiations with Hyundai

IRISL’s operating portfolio is modest by today’s standards, but all that is about to change.

On December 9, they reached an agreement with Hyundai Heavy Industries to build 10 ultra large vessels at Hyundai’s Ulsan yards in South Korea. Stretching 2.5 miles along Mipo Bay, Ulsan is the world’s largest shipbuilding operation. When the ‘new build’ frenzy began to cool between 2008 and 2010, shipyards were left holding the bag on unfulfilled orders.

Delivery dates slipped and contract prices were renegotiated leaving shipyards in a slump that continues today.

Hyundai began negotiations on Iranian ships in 2005, but plans were sidetracked as the world’s economy weakened. Finalizing this order will breathe new life into Hyundai.

The Ulsan yard will build six chemical tankers and four ultra large container vessels each at 49,000 DWT with a capacity of 14,500 TEUs. Delivery of the first of these mega container ships is scheduled for 2018. An additional two ULVs may also be in the works upon the completion of the initial order.

The total for tankers and container ships is said to be worth $2.4 billion.

Challenges, opportunities

As a niche player with limited capacity, IRISL had adequately filled the country’s maritime needs and had additional container slots to sell on the open market. Mega vessels will require more aggressive marketing and greater sophistication in handling at load and discharge centers. Some of this expertise will be provided by CMA-CGM that has entered into an operating agreement with the line. This agreement comes on the heels of more open trade, as nuclear sanctions are lifted and world commerce once again flows through Iranian ports.

Several carriers, including Evergreen and MSC, reopened calls to Iran this year with the potential for United Arab and Maersk to enter the market after January. Renewed trade with Europe will commence with the further loosening of sanctions.

IRISL will surely capitalize on their expanding container fleet and slot charter agreements with their carrier partners.

Capital for investment

The United States paid Iran several billion dollars in frozen assets as interest against a failed 1979 arms deal. Payments began after the UN Security Council lifted the nuclear sanctions, which triggered Iran’s maritime development.

As IRISL began to examine options for fleet development and trade expansion, world markets opened up and international partners such as Hyundai and CMA-CGM came on board.

Funding for construction and development of Iran’s maritime interests came along with it.

Ambitious plans

Managing Director of the Iran Shipbuilding and Offshore Industries Complex Company (ISOICO) Hamid Rezaeian-Asl announced an agreement with Hyundai Heavy Industries for financing and technical knowhow at their facility near Bandar Abbas.

Opening in 2006, the ISOICO facility sits on 1,100 hectares of land with a 380-hectare marine basin. Initial projects included design and construction of several passenger liners and feeder-max container ships.

The yard has the capacity to build and repair larger vessels and Hyundai will advance Iran’s ability to produce VLCC and ULCC class container ships.

A bright future

With the infusion of money and expertise from world sources, IRISL has announced plans to become a top 10 ranked Alphaliner carrier by 2020.

China has also been invited to visit the ISOICO shipyard and last year there were even negotiations for the Chinese to build 18,000 TEU ships for the line.

The future of Iran’s maritime interests is extremely bright. Of course, having the money to invest in the expansion of national fleet and shipbuilding facilities is crucial.

The world seems to be at Iran’s doorstep; even the United States did $152.4 million in exports this year.

As IRISL expands port calls to Europe and increases trade routes to Asia and Africa, whether Iranian ships will dock at US ports any time soon remains to be seen.

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Jonathan Andrews, Director & Head of Eastern Underwriting in Steamship Mutual, said a considerable number of Iranian vessels have taken out insurance form our company and “we are pleased to observe return of Iranian directors to the board of one of the largest and most diverse P&I Clubs in the world.”

Prior to imposition of sanctions against Iran in 2009, Steamship Mutual, as a leading provider of Protection & Indemnity (P&I) insurance, was the main and most favorable insurer of Iran’s shipping fleet.

IRISL has purchased insurance from Steamship Mutual for container ships and multi-purpose vessels though vessels active in the field of international trade will receive top priority.

Earlier in August, during a visit to Tehran of a Norwegian delegation, a Memorandum of Understanding was inked between Iranian Shipping Lines (IRISL) and the Skuld Marine SKULD P&I Club for shipping insurance cooperation.

By virtue of this MoU, different cooperation grounds between the Islamic Republic of Iran Shipping Lines (IRISL) and the Norwegian SKULD P&I Club including providing different types of maritime insurances, considering and pursuing complaints regarding maritime insurances coverage, training personnel and promoting the knowledge and competency of the Iranian experts were discussed and the respective mutually agreed issues were signed by both parties.

IRISL was the first Iranian shipping line to be affected by Western and European sanctions. Presently, IRISL and the National Iranian Tanker Company (NITC) have resume cooperation with Steamship Mutual international club in a bid to revive previous relations.

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Mohammad Saeidnejad, Managing Director of Iran’s Ports and Maritime Organization (PMO), made the remarks on Sunday adding “implementation of the Joint Comprehensive Plan of Action (JCPOA) has removed all restrictions on return of giant shipping lines to Iran.”

“Prior to sanction years, a total of 27 international shipping lines were present in Iranian waters though a large number of them halted their activities as a result of severe economic sanctions against Iran,” underlined the official saying “all major lines are arriving back to the country as 17 companies have been loading and unloading goods at Iranian ports without any preconditions.”

Saeidnejad went on to state that Denmark’s Maersk shipping group has voiced its readiness to return to Iran like many other foreign companies, a trade decision in which political issues have no place since large liners are allowed to freely enter the Iranian market at a competitive atmosphere.

“The most significant advantage of the present condition is that, in a competitive market, gainer shipping lines feel the need to promote satisfaction of customers, who are indeed owners of Iranian goods,” said the official.

Saeidnejad further reiterated that a competitive market will bring about an uplift in quality while, at the same time, it will reduce prices and costs for the county; “all in all, the new market will lead to improved business conditions inside the country.”

The Maersk Group of Denmark is an integrated transport & logistics company with multiple brands and is a global leader in container shipping and ports.

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Turaj Amiri further said that given the expected 28 percent rise in operations in the year to mid-March 2017, the port will handle over 2.1 million containers during the period, IRNA reported.

Pointing to the loading and unloading of three million containers per a year during the years before the Western sanctions, the official said the figure dropped to 1.6 million last year.

He put the annual operation capacity for the first phase of Shahid Rajaei’s First Terminal at 1.5 million containers adding that once the second phase of the terminal’s development project becomes operational, the figure will rise to 3.5 million containers.

Pointing to the capacity of the Second Terminal of Shahid Rajaei Port, he said that with the completion of the third phase of development plan, the annual operations capacity for the port will grow to 8 million containers.

“Step by step the problems have been resolved (since then), removing many restrictions and limitations,” Mohammad Saeidi, the chairman of Islamic Republic of Iran Shipping Lines (IRISL) told Reuters in an interview at the Danish Maritime Forum conference in Copenhagen on Thursday.

A slowdown in global trade together with a glut of vessels has left the container shipping industry struggling with its worst ever market conditions, but Saeidi said the post-sanctions environment meant IRISL would be looking to expand its 156-ship fleet.

“We are negotiating with some shipyards and some makers and hopefully it would reach clear conclusions in the next 3-4 months,” he said.

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