TEH-HU CARGOCEAN MANAGEMENT
ENSURING A LEGACY Powered by Inside Marine
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TEH-HU CARGOCEAN MANAGEMENT
I PROFILE
After almost 75 years of operations, Hong Kong-based shipowner Teh-Hu Cargocean Management has undergone a leadership transition. CEO Patrick Lo and COO Shrah Ng explained more, in an exclusive interview with Inside Marine. Report by Imogen Ward.
W
ith strong family values, Teh-Hu Cargocean Management (TCM) has been developed by three
generations. Now with the third generation at the forefront of the business, the company is developing a new vision. “TCM has always been a very traditional business,” said CEO Patrick Lo: “After we joined the company, we sought to implement modernisation. This hasn’t been achieved in a drastic way, but every year we add something new.” TCM was established in 1974 by Chung Kia Liu, Chi Kong Lo and Tchung Year Wu, following a merger of two companies. Its predecessor, Teh-Hu Steamship, was founded even earlier in 1948. Initially operating with a fleet of small bulk carriers, the company went on to acquire Handysize, Panamax and Capesize vessels before
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choosing to focus its efforts on the Capesize
The third generation
market. Now, the company is well positioned
Both Mr Lo and Ms Ng have a long-standing
with a fleet of seven Capesize ships.
presence at TCM and have been able to
“We added two vessels in the past few
utilise this alongside their previous experi-
years, including a newbuilding,” COO Shrah
ence to ensure a smooth transition from one
Ng said. “We then sold a vessel in 2021, called
generation to the next.
Prosperous – taking our total fleet figure to seven.”
Initially joining TCM in 2011, Mr Lo has held the position of CEO ever since. He also possesses 18 years prior experience within the finance industry, as a China fund manager at Fidelity Investment. This experience afforded a greater understanding of the Chinese market; in particular the economic developments. With 70% of the demand for Capesize coming from China, this knowledge is crucial for TCM.
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TEH-HU CARGOCEAN MANAGEMENT
I PROFILE
before we became involved day-to-day. Our Mr Lo’s thoughts on the industry:
parents would always bring us to business
“Capesize is a very volatile business, and to be successful there are two very important things to consider: the timing of decisions – especially when it comes to buying and selling – and balance sheet management are both crucial. The right balance sheets make it easier to pursue new investments.”
dinners, and that gave us an opportunity to meet with partners and build that relationship early on. This continued once I joined the company as well.” With 20 years’ experience at TCM, and prior experience in investment banking, Ms Ng possessed the perfect qualifications to head the company’s operations.
“My previous experience as a portfolio
Partnered with a Bachelor of Science
manager helped sharpen my investment
in Management and eight years of
and risk management skills,” Mr Lo said.
experience working in TCM’s operations
“That’s based on a lot of input, including
department, Ms Ng confidently took on
economic data and varying sources of
the position of COO in 2011.
information. At TCM, we rely on data, and
“During my time working in the finance
I try to draw from my previous experience
industry, I oversaw a lot of legal documents
as much as possible.
for public offerings,” said Ms Ng: “This really
“Even before that, because myself and
helped for my transition to TCM, because
Ms Ng grew up with the company, we were
the skills I learned were transferable to the
exposed to the company and the people
shipping industry.”
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Both Mr Lo and Ms Ng have vast experi-
putting in the resources to upgrade these
ence working side-by-side and believe this
systems. This is really important because
has helped ensure a smooth transition to
safety is always on top of our agenda,
the next generation.
and having that instantaneous feedback enables us not only react quickly, but also
A new vision
ensures we can take a more proactive
As TCM moves forward with its plans for
approach as well.”
modernisation, the company is taking its time to ensure it is successful. “We believe that the biggest challenge
Besides modernising the vessel’s systems, TCM was also an early mover in scrubber technology. Back in 2018, the company
in evolving from a traditional owner into a more modernised company, is time,” Mr Lo said. “We understand that this evolution cannot be done overnight, and because of that we try not to make any drastic changes.” The company has been working with Anglo-Eastern (the company in charge of TCM’s crew and technical management) to upgrade the IT infrastructure and systems aboard its vessels. This will allow for more secured, efficient and instantaneous connection between vessel and shore. “We want to have remote access to – as well as instant feedback from – the vessel,” Ms Ng said. “So we have been
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TEH-HU CARGOCEAN MANAGEMENT
I PROFILE
started working closely with ContiOcean
implementing modernisation is with a mix
to retrofit/install scrubbers on its existing
of long-standing professionals and new
vessels and newbuilding. The early mover
faces. A lot of the company’s workforce
advantage allowed TCM to enjoy a rather
has worked for TCM for a long time. With
short payback period.
that comes knowledge and experience.
Another way in which the company is
However; as more workers are nearing
ensuring it can overcome the challenge of
retirement, TCM is looking to bring in more of the younger generation.
Moving forward TCM firmly believes that the shipping industry is heading for a period of vast change – one that will affect everyone. According to Mr Lo there will be four big shifts which the industry will have to adapt to. These relate to inflation, growth and industry-wide goals. “The market is evolving all the time, and I expect these dynamic shifts to occur over the next five to ten years,” Mr Lo explained. “These will not only impact the Capesize market but also the shipping business more generally. Firstly, the era of low interest
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rates has come to an end. We are now entering a phase of medium to high inflation. As a knock-on effect, the growth of China’s economy will begin to slow down, creating a low-growth situation.” “The next factor is globalisation: previously the big players in the industry have been focused on gaining global status, and now, I believe we are entering a phase of deglobalisation. The changes to supply chains had a big impact on this. Finally, decarbonisation will play a huge factor in shipping – mainly from the supply side. Obviously, we do not have access to a crystal ball that will show us how each of
“We work within a very dynamic industry,”
these factors will evolve, but as an industry
Ms Ng concluded. “Over the past few years
we need to gain a clear understanding of
(especially during the COVID period), ship-
each one and its potential impact.”
ping has proven its importance within
As a company, TCM was set up to work
global trade. Being the third generation
in cycles, so it already understands these
here at TCM, we have a responsibility
shifts and is perfectly positioned to correctly
to continue the company’s legacy, and be
adapt to each shift as it comes.
a big player in the future of global trade.” n
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