KSOE and Samsung Heavy Industries exceed last year’s orders

South Korean shipbuilding companies successfully won large ship orders. Korea Shipbuilding & Offshore Engineering (KSOE), Hyundai Heavy Industries Group’s intermediate holding company for shipbuilding business, announced on Tuesday that it won 1.36 trillion won of orders to build 12 ships on Friday and Monday.

The orders include four large LNG carriers and two super-large LPG carriers from shippers in Europe, Oceania, and Africa. They will be built at the dockyard of Hyundai Heavy Industries in Ulsan and Hyundai Mipo Dockyard for delivery to shippers by 2024.

Samsung Heavy Industries also made a public announcement on large order wins on Tuesday, following its announcement on Monday. The company won orders to build two LNG carriers worth 417 billion won on Monday and four large container ships worth 529 billion won on Tuesday from a shipper in Oceania. The large container ships, which can carry 13,000 20-feet containers, will be built at a dockyard in Geoje, South Gyeongsang Province and consecutively delivered by February 2024.

With the new orders, Samsung Heavy Industries secured 5.9 billion dollars worth of orders in just five months this year, which is higher than its order win record of 5.5 billion dollars last year. The company has reached 65 percent of this year's goals.

Shipbuilders’ order winning prospect is bright. Global ship orders placed so far this year reached 17.95 million CGT, or 83 percent of the 21.5 million CGT record of last year, according to Chosun Shipping's market trend analysis company Clarkson Research. Ship orders related to the increased demand for shipping and energy development are also expected.

The South Korean shipbuilding industry is expecting profit growth as ship orders increased significantly this year. According to Clarkson Research, the Newbuilding Price Index went up from 125.0 points in November last year to 136.1 points at the end of May this year, which is the highest level since December 2014. A higher index means the prices of shipbuilding rose.


Hyung-Seok Seo skytree08@donga.com