By Chikako Mogi and Randy Fabi
TOKYO/SINGAPORE (Reuters) - Mitsui O.S.K. Lines has not yet decided what it will do with its container ship when it returns to Japan this week, a company official said on Tuesday, after China rejected the vessel for "abnormal" radiation levels.
The MOL Presence is the first ship barred from unloading its cargo at a foreign port over radiation concerns since Japan's Fukushima nuclear plant was crippled by the March 11 earthquake, a spokesman for the Japanese Shipowners Association said.
Governments, including China and the United States, have begun screening for radiation on ships that traveled from Japan's quake-hit northeast, threatening to slow seaborne trade for the world's third largest economy.
"The container ship is expected to arrive in the port of Kobe on Wednesday," said a spokeswoman for MOL, the world's 11th largest container shipper. "The travel plan on when or whether the container ship will depart Kobe is not decided as of now."
If radiation levels are confirmed to be too high on the vessel, MOL may be forced to dispose of the machinery, furniture and other cargo on the ship and reimburse its clients since insurance companies do not cover radiation exposure linked to nuclear accidents, industry experts said.
The vessel would also need to be thoroughly cleaned before it can set sail again.
Chinese authorities detected a maximum of 3.5 microsieverts per hour on MOL's ship when it arrived at the port of Xiamen in eastern Fujian province last week, the company spokeswoman said.
That is above the global average of naturally occurring background radiation, but half of the cosmic radiation experienced on a Tokyo-New York flight.
The Chinese standard level was not disclosed.
The MOL Presence originated in California, stopping in Tokyo for only a few hours on March 17 before arriving in China four days later, port authorities said.
Ports in Tokyo Bay, located 240 km (150 miles) south of the Fukushima nuclear plant, remain outside the exclusion zone for most shipping companies.
However, at least three container firms -- Germany's Hapag-Lloyd, Claus-Peter Offen and Hong Kong's Orient Overseas Container Line -- have widened their "no-go" area to more than double the industry norm to include Tokyo Bay.
"At this point, there is no change to our shipping schedule, including location of the ports we call at," the MOL's spokeswoman said. She said this is the first case a Mitsui ship was turned back.
Radiation levels as of late Monday in Tokyo Bay ports were considered "very safe", Japan's transport ministry said on its website.
"Thus far, the flow of traffic to and from Japan has not been impacted by radiation fears," said a U.S.-based shipping source.
"Although some owners have been reluctant to trade cargoes to Japan, there have been sufficient owners willing to do so and that has minimized the impact."
(Additional reporting by Joshua Schneyer in New York; Editing by Himani Sarkar)