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S. Korean Shipbuilders Reclaim Top Place in July Orders

Seoul - According to the data from British maritime market analyst Clarksons Research on August 8, new orders won by Korean shipyards stood at 316,000 compensated gross tons (CGTs) in July.

Seoul - Korean shipbuilders reclaimed the top place in global ship orders last month, surpassing China. According to the data from British maritime market analyst Clarksons Research on August 8, new orders won by Korean shipyards stood at 316,000 compensated gross tons (CGTs) in July. Chinese shipbuilders obtained new orders of 295,000 CGTs. As global new shipbuilding orders decreased by more than half last month compared to the previous month, shipyards around the world are still struggling for survival. South Korea and China were nip and tuck as they vied for first place from January to June. China ranked first with cumulative orders won of 2.9 million CGTs in the first half of this year by a narrow margin, followed by South Korea with 2.84 million CGTs. However, South Korea recaptured first place in July again.

Japan, which was considered one of great shipbuilding powers along with South Korea and China, failed to receive even one ship last month. Vietnam took third place with new orders of 124 CGTs. The global shipbuilding order market dried up in July. There were new orders of 869,000 CGTs, or 30 ships, accounting for 46 percent of the total orders of 1.9 million CGTs in June. In general, there are not many new orders during the summer time because it is the vacation season for European shippers. In addition, the market conditions are less favorable, pushing down the number of new orders by more than half. The price of ships also hit the bottom and has remained low. The price of ultra large crude oil carriers has continuously remained at US$81 million (91.81 billion won) from June, while that of ultra large container ships hasn’t changed at US$143 million (162.05 billion won). The price of 174K LNG carriers stood at US$183 million (207.43 billion won) in July, down US$1 million (1.13 billion won) from the previous month.

The amount of new orders in the second half is highly likely to be lower than expected. Although regulations on ballast water treatment systems will be introduced in order to prohibit individual ships from discharging polluted ballast water in ports of other countries, shipbuilders will not be able to benefit from it soon. This is because the International Maritime Organization (IMO) decided last month to delay the period of mandatory system installation from 2022 to 2024. Ships which are more than 20 years old cost more to install the ballast water treatment systems rather than building a new ship. Accordingly, market experts expected that the number of new orders will increase starting from this year. However, expected new orders will slightly decline in the second half of this year owing to the grace period of mandatory installment.

(Source: Businesskorea)

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