Domestic shipbuilders win seven times more orders this year

Korean shipbuilders have won seven times more new orders in the first half of this year from a year ago. The global new orders have reached their highest since 2014, leading to the speculation that the shipbuilding industry’s super cycle is coming.

According to U.K.-based market researcher Clarkson Research Services on Tuesday, the total volume of orders won by Korean shipbuilders for the past six months was 10.47 million compensated gross tons (CGTs), seven times higher compared to 1.35 million CGTs the same period last year. Korean shipbuilders narrowed the gap with China, which received 10.59 million CGTs during the same period.

South Korea is expected to surpass China to become the world’s largest shipbuilding nation in the latter half of the year given that the first half’s volume is equivalent to two 15,000 TEU container ships. Last year, South Korea became the world’s largest shipbuilding nation by clinching orders of 8.19 million CGTs (187 vessels), overtaking China, which received orders of 7.88 million CGTs.

South Korea has shown competitiveness in higher value-added areas, winning orders for all 16 large liquefied natural gas (LNG) carriers, 42 out of 51 tankers (82%), and 52 out of 72 liquefied petroleum gas (LPG) carriers in the first half of this year. By type of vessels, orders for container ships (12,000 TEU or larger) and very large crude oil carriers (VLCC) are on the rise, due to a spike in cargo volume resulting from the global economic recovery.

The global new orders in the first half of this year were 24.02 million CGTs, 192% higher than the same period of last year (8.24 million CGTs). South Korea accounted for 44 percent of the global new orders in June (4.15 million CGTs, 131 vessels) with 1.82 million CGT, or 40 vessels, taking the top spot for the second straight months. South Korea was followed by China and Japan with 1.57 million CGT (63 vessels, 38%) and 300,000 CGTs (14 vessels, 7%), respectively.


Dong-Jin Shin shine@donga.com