China Cosco Group, the world’s second largest shipping company by capacity, is considering making investments in foreign iron ore, coal or oil resources in a bid to dilute the financial impact of the volatile the shipping business, the group’s vice-president Zhang Fusheng told China Daily.

Such a diversification leading to Cosco becoming both a cargo- and ship-owner could significantly reduce its risks. Coal and iron ore are best suited to Cape and Panamax vessels, the two main ship types operated by the company, according to Citic Securities.

The group as a whole made a profit of Rmb600m in 2009, but its main activity of shipping posted significant losses due to the global economic downturn, Zhang said.

The possible investment in mineral resources is part of a wide-ranging restructuring planned by the carrier. It will also devote more resources to developing land logistics, a strong financial performer for the group last year. Currently, more than 90 per cent of Cosco’s business is derived from international shipping, according to Zhang. In future, he said there would be a greater focus on domestic shipping, including costal shipping and inland water transportation.