70 years of CHINESE–POLISH JOINT STOCK SHIPPING Co - a success story

70 years of CHINESE–POLISH JOINT STOCK SHIPPING Co - a success story

May 7, 2021

In the early 1950s, China was largely destroyed by foreign invaders and war. There was also an UN embargo and the war in Korea. Under these circumstances there was no access to world markets, but necessity to rebuild the country. This prompted the government of the newly formed The People's Republic of China to look for allies. Especially those with a pronounced maritime economy and knowledge. In the communist sphere of influence of the Soviet rulers, one stumbled upon the People's Republic of Poland. Also a start-up with a newly founded POL Polish-Ocean Lines from 1951 and good experience in shipping goods to China. With a flourishing shipping culture, vast knowledge of maritime trade and top class professionals within a global network the choice felt on Poland as future partners.

Former Prime Minister of China, Zhou Enlai, blessed foreign capital, which was totally equivalent to 80 million Roubles having parity in pure gold and both parties invested in it in equal shares of 50% each. A joint venture became the plan headed by two governments, by name ministry of shipping of The People’s Republic of China and the ministry of communication of The People’s Republic of Poland. Both representing the company also nowadays by State Secretaries. The contract of cooperation was finally inked on 15th of June 1951 at Tianjin. The day the company Chinese–Polish Joint Stock Shipping Company was born and became operational. According to establishing agreement the company head office was set up in Tianjin and branch office in Gdynia, Poland.

In order not to overlook this activity, which was actually subject to the UN restrictions, it was decided to use a more harmless name than would have been usual for a shipping company. To overrule blocked investments into China the enterprise was declared to be a broker. As such working could be started instead of being a shipping company. This made the uncontroversial name Chinese-Polish Ship Broker Company later to become the globally known brand „CHIPOLBROK“ which originates simply from the telegram address. In those days telegram was the international way of communication long time before telex, fax and internet became existing.

Whilst this company became Chinese first ship owner the tonnage necessary was given from Polish Government, namely „PUŁASKI“. Humble beginnings with small and old tonnage. More units followed and also from Chinese side three ships had been given into this start-up. After half-a-year the fleet was already grown to 10 units with total deadweight over 100,000 tons with initially mixed crews, e.g. Polish officers and Chinese seafarers.

Part of the Chinese-Polish Joint Venture became an agreement to have all key-functions ashore double manned with Chinese and Polish staff officers. This concerns until today all management posts and levels above. And the cooperation between both nations still works very well.

Basis for the employment of ships became cargo deliveries from all over Europe, but mainly from eastern countries to Gdynia. For decades this port was the turntable in the trades westbound and eastbound. The political situation in Far East forced the routing of the ships via a Pacific detour. Nevertheless it happened in 1953, that two ships had been stopped by Taiwanese coast guard, confiscated and the crew arrested for a longer time. One of those was the 1921 built m/v „PRACA“, a 9,012dwt steamer which came into the focus of the former Chiang Kai-Shek regime. The entire crew suffered a lot from that incident.

1962 became a mile stone by switching the headoffice from Tianjin to Shanghai, the secret capital of the empire and trading metropolis. The move went into an impressive historical building reminiscent of the Renaissance style (designed by Palmer & Turner) close to the Waitan (Bund) and with a bright view to the Huangpu river and the island of Pudong. The world famous Peace Hotel with its swing dance band was just around the corner and preferably used for many of the receptions given for visitors at Chipolbrok who always presented itself as an outstanding host. Todays residence is in the building Gong Shang Lian (floors 26–28), also called Heng Ji Plaza in the centre of the city.

Over the decades the company has grown steadily. Old steamers had been replaced by newbuildings originating from Polish shipyards like „KONOPNICKA“ named after a Polish female poet. A tradition of Polish side is that all ships had given names from Polish poets, writers and composers. Whilst Chinese side prefers names of cities, from universe or oceans. Whenever newbuildings had been set into service in later times most of the first given names sooner or later being repeated, except that of „KONOPNICKA“. This habit of namings is continued to this day.

After a serial of conventional ships as was customary at the time and supplied from Polish shipyards a sharp cut was done when the decision was taken in late 80ties to open the sphere of activities to the market of western Europe. Whilst ships of Chipolbrok appeared at ports like Antwerp, Rotterdam or Hamburg more occasionally at that time the step was taken to run these ports more frequently. This also in line with the big Baoshan project which was concluded as key carrier together with Chinese state owned forwarder Sinotrans. With the keen competition of many other owners, carriers and operators around not an easy task to establish themselves in that shark basin. Especially since the fleet showed only limited possibilities. At the same time, the degree of containerization increased sharply because the Chinese economy began to develop and grow at a breathtaking pace.

In order to expand the capacities, four larger used ships of Japanese origin were bought in the mid-eighties, which provided their services for the shipping company until 2008. After more than 20 years in the service of the shipping company and hard work, they had then completed their tasks and reached the life expectancy of a heavy lift carrier. With already dismantled heavy Stülcken gear, they had to start their last journey to Indian beaches.

Consequently both partners of Chipolbrok decided to employ more sophisticated vessels with a fresh design and better opportunities. Ready for the carriage of boxes but mainly focused on break bulk cargo. At that time, the so-called K-Class ships were the measure of all things in the conventional sector. But already aged and no longer up to date. So, a new type of ship had to be created. The decisive design study came from the May 3rd Shipyard in Rijeka, in those days Yugoslavia. The so called Rijeka-type was born. In total seven self-craned triple decker with wide and long hatches and a dwt-capacity of roughly 22,000 tons. Four of these ships had been set into service from 1991-1993 and proved themselves excellently. But due to the civil war in Yugoslavia another three vessels, in between slightly improved, came into service only in the years 1997/1998.

Soon these ships took over the main burden of the service between China-Far East-SEA to Europe and vice versa. Those ships enabled Chipolbrok throwing more of an eye on other major projects. The choice was wide and agents attracted different opportunities. Finally in 1992, the decision was made in favour of the Shanghai Metro project, which required regular departures from Hamburg at specified time intervals. A small step in shipping but a huge step for the company. By keen efforts Chipolbrok gradually became a brand name for conventional services from and to China and set about overtaking its strong competitors.

The step in October 1993 to extant the frequency of departures from Europe to Asia from a monthly basis to three departures each month attracted a great deal of attention from shippers and let competitors sit up and take notice. What was initially only perceived as lip service soon turned out to be a well thought-out strategy that was retained over several decades.

When container shipments became non-profitable anymore but also did not fit anymore to the break bulk handlings, especially as an independent single carrier beyond any alliances or pools, soon the container stock was given up and was for sale. The main focus was definitely put on any kind of project cargo, break bulk and bulk cargo. Base ports had been Shanghai, Xingang, Dalian, Huangpu, Qingdao and Lianyungang in China plus Busan in Korea whilst in Europe Rotterdam, Antwerp and Hamburg had been the supporters. Occasionally on the eastbound trip also Aqaba as transit port and Jeddah had been served.

Step by step older tonnage of the so called smaller „composer-class“ was withdrawn from the schedule but also forcing the company to consider new tonnage. Not an easy decision where to take it from because European shipyards believed exclusively in container ships but no future for multi purpose vessels. Instead the Shanghai shipyard offered a slightly re-designed container vessel type tailor made for the carriage of high, heavy and mighty cargo. Larger dimensions, more dwt and unprecedented crane capacity made these ships unique in the shipping company's previous fleet. A real quantum leap, on the basis of which ten ships were finally ordered. At a time when conventional shipping was not going to have a bright future, the tonnage in service was largely out of date and the focus was mainly on containers, a very courageous decision. First ships of this so called „Orkan-type“ were delivered in 2003/2004 and after their probation, a further six followed with a time lag between 2009 and 2011. The fleet was then grown to 18 own ships. In peak season even became later 21 mpp vessels.

In line with these new ship orders and growing demand for Chinese products in the USA the separate own office had been opened 2004 at Houston, manned by Chinese and Polish decision takers as before at the Shanghai headquarter and Gdynia branch office. The booming market made that office a profitable outfit of new business over a long period of time. In addition, the shipping company has entered into joint ventures at other locations. But otherwise the services make use of independent agents in the most important areas of the activities.

During this lively period, also the decision to convert the Rijeka-type ships at Chinese shipyards to more powerful cranes, starting in 2008, was taken. Until that time, 50ts Gemini cranes were sufficient for lifting containers and a large part of the general cargo, but the market demand had to be met. As part of a multi-million dollar program, all seven ships were upgraded with cranes using the Gemini lifting method of up to 300 tons SWL.

In 2015 the door was pushed open for a new generation of a previously unseen type of multi-purpose vessel, the so-called „Pacific“ type. Craned up to 700ts and hatches of up to 5o,56m length, bale space of almost 40,000 cbm and a dwt capacity of 31,600 tons goes beyond all previous scope of the ships employed in the fleet. Present vessels’ space needs are covered frequently by the additional, chartered-in tonnage.

Now when „Rijeka-type“ vessels are out of fleet and only one in services of charterers remaining we have to consider the age of the "Orkan-types" the first of which are gradually approaching the age limit of 20 years. And - of course - already plans exist for new and other ships for the fleet and where and when those are to be built. Probably the purchase of solid used mpp tonnage might help to re-structure the fleet and find suitable substitutes for the long-serving working horses.

In the meantime Chipolbrok has become a true world leader in shipping big volumes of project cargoes offering to its clients its sophisticated global services. Additionally, following shipping policy targets, the company has been more intensively involved in dry bulk and semi-bulk shipments, which enables better optimisation of vessels’ employments and meeting the market needs. The extension of shipping services and its diversification lie in the fundamental assumptions of Chipolbrok’s future development.

It is true that Chipolbrok thinks outside the box. However, the existing services will largely continue unchanged. Those are on our main trade lane from China and Far East to Europe and separately to America vice-versa, both headed by our Shanghai office. The service from Europe to Mid East, India, South-East Asia, China and Far East is leaded by the Gdynia office. This means today’s organisation remains unchanged. Even if the services are global, our independence is and will remain a great asset for Chipolbrok.

In principle, the shipping company has retained its original structure. The excellent cooperation between the shareholders involved has more than proven for itself. The common liaison works well; new, ambitious age groups are growing up and future seafarers are trained on the ships. Shipping will continue to be an integral part of Chipolbrok's core business.

As a final word, it should be said that CHIPOLBROK will continue this success story since 1951 still for a further long time.