A slump in bulk carrier orders has dragged down newbuilding prices.

2015-10-27 09:00

Clarkson's latest data shows that the newbuilding price index has fallen again. Compared to its peak in 2007, the price of new ships has decreased by 30%.

Currently, Clarkson's newbuilding price index stands at 133.3 points, a year-on-year decrease of 3.5%. In the summer of 2007, this index reached as high as 191.4 points.

The further decline in the newbuilding price index again shows that the decrease in new orders for bulk carriers is affecting the prices of new ships in other sectors. To compensate for the lack of bulk carrier orders, shipyards have had to lower prices to secure new orders.

Chinese shipyards have always been competitive on price in the newbuilding market. Currently, the significant reduction in new orders for bulk carriers has dealt a heavy blow to Chinese shipyards.

According to Clarkson's data, the number of new VLCC orders this year has increased by 100% compared to 2014. Despite this, the price of new ships has still fallen. The average price of a VLCC this year is approximately US$95.5 million, while last year it was approximately US$97 million.

Meanwhile, the number of new Aframax tanker orders has also increased by 182% compared to last year, but the average price has fallen from US$54 million last year to US$53 million.

Despite this, the prices of some ship types remain relatively firm, one of which is container ships. Clarkson stated in its quarterly report that new container ship orders have been steadily increasing year-to-date; as of the end of September, the guide prices for 8800TEU and 13000TEU container ships are US$89 million and US$116 million respectively, representing increases of 1.1% and 0.4% year-on-year.

Overall, the number of new ship orders across all sectors this year has fallen by 25% compared to last year, with the number of bulk carrier orders falling significantly by 80%. Brokerage firms are not optimistic about a recovery in bulk carrier orders, as there are no signs of improvement in the bulk shipping market, and the scrapping of bulk carriers also slowed down in the third quarter.

Shanghai Waigaoqiao Shipbuilding has received an order for six 21,000 TEU container ships

The continued decline in oil prices has dealt a heavy blow to the offshore engineering market

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