While researching the Canadian West Coast shipping market, Andrey Bondarenko, Managing Director for Varamar’s Project & General Cargo Division, found a gap. “Varamar offers a service that doesn’t currently exist in the West Coast market,” he said. “There are services for large cargo projects (over 10,000 freight tonnes) and smaller cargo can be loaded into containers, but for cargo that is in the middle — 3,000 to 5,000 freight tonnes — there are no efficient solutions for this market.” Bondarenko has met with a number of local agents and charterers and all see the benefit of having Varamar expand into this market with their fleet of 15 multi-purpose project vessels.
Given the parameters of a minimum weight of 40 to 45 tonnes (anything below that can be loaded in a container) and a maximum of 160 tonnes for the B.C. market; and, size-wise, anything between 12 metres and 90 metres, Varamar is positioned to capture the middle market for Canada’s West Coast.
Background
Varamar’s Project & General Cargo Division is part of a larger group of companies, including Varamar Bulk which operates Handy to Panamax vessels in the European market; a chocolate factory that imports hand-made Belgian chocolate into Ukraine and sells franchises; a digital software company for ship management — SHIPNEXT — mostly used for the bulk market; a travel agency and Varamar Trans, an inland forwarding company in Ukraine. “The Varamar Group, while not as well known in the North American market, is a significant player in Europe,” said Bondarenko.
Established in 2009 in Ukraine, Varamar started with a small office with three staff in Odessa. The company initially focused on ship operations and trade between the Mediterranean and Black Sea with routes extending out to Europe and the Middle East/Persian Gulf. After two years, they opened an office in Dubai to provide for round-trip services, and then expanded to Asia after signing a significant contract with a South Korean firm to provide monthly shipments of industrial equipment for shipbuilding. “For the past eight years, we have been delivering cargo between Europe and Asia,” said Bondarenko. “We now have 16 staff in offices serving India, the Far East, the U.S. Gulf and East Coast of South America as well as West and East Africa, and the Black, Mediterranean and Caspian Seas.”
Prior to joining Varamar, Bondarenko worked for a company in Europe which had 50 coaster vessels trading with bulk cargo. He had worked his way through the company as the crewing manager, security officer and port agent before becoming their head of operations. “When I came to Varamar, my job was to build the liner service back from Asia to Europe and I was put in charge of the Asian chartering desk,” he said, providing examples of projects like moving large volumes from the Mitsubishi Hitachi Power Systems project for two power plants in the Black Sea; becoming one of the main carriers for GE to deliver cargo from Europe worldwide; assisting Siemens with a power plant in Egypt; and delivering 80 per cent of the structure to build the Qatar World Cup stadium.
Now, with offices in Odessa, Dubai, Genova and Hamburg, Varamar has set its sights on the Americas. “We’ve had limited involvement in South America with some small shipments of windmill equipment and we operate in the U.S. Gulf and Chile but now, we’ve decided to expand and close the circle — from Europe to North America, and from Asia to North and South America in the future.
One other significant point about Varamar’s operations that Bondarenko stressed was that the company does not own its own vessels. “Given market fluctuations, we’re flexible enough to be able to operate efficiently and respond quickly. While we may have 15 vessels available today, tomorrow, it can be 17 and next month it can be 10. We can be very flexible but we want to maintain a size that is just right for us. We like to think of ourselves as a small, exclusive shipping boutique with people who care.”
Bondarenko further noted that all employees have extensive maritime education. Bondarenko himself has a Masters in Maritime Transportation; the people who work as port captains are former Masters from heavy lift vessels; or on the operations side, the staff used to be stevedores.
Vancouver operations
“My role in the Vancouver office is to develop trade of project and heavy cargo on our MPP vessels, both inbound and outbound,” said Bondarenko. “The service Varamar will offer to North America, and especially to British Columbia, is unique — we like to consider ourselves a ‘boutique shop’ — there is no one doing what we’re offering.”
Noting B.C.’s strong bulk market, Bondarenko has identified an opportunity for medium-sized volumes of project cargo. “Trade between Asia and the West Coast is well served by heavy lift carriers for cargo over 10,000 freight tonnes but for freight in the 3,000 to 5,000 tonne range, most is shipped into Houston and then trucked to the B.C. market.”
The Varamar fleet consists of vessels in the 7,000 to 12,000-tonne range and most of them have two x 80-tonne cranes. “When you need to load small project cargo, you can load it onto a container vessel; if it’s bigger than that — say 1,000 freight tonnes, it can be loaded on the deck of a bulker and if you have cargo in the 10,000 to 12,000 tonne range, you would take a big heavy lift vessel. But there’s a sweet spot that is not served — the 3,000 to 5,000-tonne market,” said Bondarenko.
In addition to finding the niche, Bondarenko noted that Varamar has a stellar reputation for good service and transportation and engineering skills. “Our main priority for the Vancouver community is to build the same customer service that we are known for all over the world. There are no answering machines, you’ll always reach a live person because we have worldwide coverage for any time zone,” he said, adding that “we’re known for our flexibility when it comes to fixing a problem anywhere in the world.”
As part of that customer service, Bondarenko emphasized that they are a ‘one-stop-shop,’ providing very strong engineering skills with survey reports, photos, etc., all included in the freight. “Customers pay once,” he said, “and there are no hidden extra expenses.”
When asked about Varamar’s decision to establish their office in Vancouver, Bondarenko noted that the Vancouver International Maritime Centre had done a good job in promoting the city as an international maritime hub. “We see a lot of projects such as LNG Canada and other infrastructure plans on the horizon. While we’re not in the market for the large volume cargo, we are able to offer service from South East Asia, Africa and Europe, especially going into areas with a shallow draft,” he said, noting that in Japan, they often call on small private berths with a draft as low as five metres where cargo can be directly loaded or discharged without extra handling. “Imagine Abbotsford wants to build a new sewage system. We can deliver the cargo directly to a berth on the Fraser River in the volumes needed so they can avoid the costs of shipping to Houston and having it trucked here or delivering a large shipment here that would require storage.”
The future
Noting that it’s early days for operations in Vancouver, Bondarenko said he is patiently building up a network of industry contacts and will start to expand the office once the business requires it. “Our goal is to ensure that the customer’s needs are met. This has been our approach across the entire company and will be the approach we take here.”
With an initial focus on the Vancouver and the B.C. market, Bondarenko expects that expansion to other areas of North America will follow. “With the investment and risk assessment we have, we want to use the same structure and procedure to develop ourselves slowly in North America, particularly on the West Coast and in Canada,” he said. “The service that we offer benefits not only the receiver or the manufacturer, but it will also benefit the community.”
