Production and sale of coatings is the largest revenue contributor in the shipping services segment to the total turnover of COSCO International. The coatings include container coatings, marine coatings and industrial heavy-duty anti-corrosion coatings. COSCO International formed joint ventures with Kansai Paint Co., Ltd. and Jotun A/S. The joint ventures have coating manufacturing plants located in Shanghai, Tianjin, Zhuhai and Guangzhou, which constitutes a cross-regional platform for production and sale of coatings.

The joint venture formed between the Company and Kansai Paint Co., Ltd., is mainly engaged in the production and sale of container coatings and industrial heavy-duty anti-corrosion coatings; while the joint venture formed between the Company and Jotun A/S is mainly engaged in the production and sale of marine coatings in China Mainland.

Container Coatings

The coating plants established by the joint ventures of the Company and Kansai Paint Co., Ltd., namely COSCO Kansai Paint & Chemicals (Tianjin) Co., Ltd., COSCO Kansai Paint & Chemicals (Shanghai) Co.,Ltd., and COSCO Kansai Paint & Chemicals (Zhuhai) Co., Ltd., (collectively known as “COSCO Kansai Companies”), are strategically located in the three of the areas with the highest economic growth in China, namely the Pearl River Delta, the Yangtze River Delta and the Pan-Bohai Rim Area, which form a cross regional platform across the areas of Southern China, Central China and Northern China, facilitating the provision of speedy and efficient services to customers of these regions..

Currently, the total maximum production capacity of the coating plants of COSCO Kansai Companies reaches 100,000 tonnes. The coating products manufactured by COSCO Kansai Companies adopt the same standards as those of Kansai Paint Co., Ltd., in the aspects including paint technology formulae, raw materials adoption, manufacturing arts, products index and customer services. Its container coatings have a leading position in the container coatings market in China.

Marine Coatings

Jotun COSCO Marine Coatings (HK) Limited (“Jotun COSCO”) is a jointly controlled entity between COSCO International and Jotun A/S in Norway, each of which owns 50% equity interests. Jotun COSCO has a coating manufacturing plant in Guangzhou and sales offices in Shanghai, Tianjin, Dalian, Qingdao and Hong Kong, etc. Jotun COSCO is responsible for the production and sales of marine coatings for new ship building, dry docking and maintenance and repair coatings in China (including HKSAR and Macau SAR).

China’s ship building industry has developed quickly in recent years. Jotun COSCO accelerated the construction of a new coating plant in Qingdao, China to line up with the production capacity expansion for future development. The plant is expected to commence operation in 2012 with a total annual production capacity of 67,500 tonnes, thus further strengthening Jotun COSCO’s leading position in the marine coating market in China.

Industrial Heavy-duty Anti-corrosion Coatings

Currently, the industrial heavy-duty anti-corrosion coatings produced by COSCO Kansai Companies are used mainly in nuclear stations, ports, power stations, oil, petrochemical, transportation and municipal government infrastructure. It has a good reputation in the industry.

With a series of policies launched to expand domestic demand and investment in China Mainland, there will be numerous business opportunities and large development potential for COSCO Kansai Companies’ industrial heavy-duty anti-corrosion coatings. In future, COSCO Kansai Companies will capitalise on the opportunities by developing coatings for trailers, monitoring China oil reserve base construction projects and expanding its share of the nuclear power plants market, in order to expand the market share of relevant products and develop new niche markets for profit growth.

COSCO Kansai Companies’ website: http://www.kansai.com.cn
Jotun COSCO’s website: http://www.jotun.com.cn