Sweeping nearly 70% of orders! Chinese shipbuilders surpass South Korea again to win the monthly order champion for the third time

2023-06-08 09:00

In May, Chinese shipbuilders once again secured the top spot in global new ship orders with an overwhelming advantage, surpassing South Korean shipbuilders for three consecutive months.

According to the latest data released by Clarksons on June 7, global new ship order volume in May reached 79 vessels totaling 2.06 million CGT. China secured 52 vessels totaling 1.41 million CGT, maintaining its top ranking with a 68% market share; South Korea secured 17 vessels totaling 0.51 million CGT, ranking second with a 25% market share.

Cumulative order data for the first five months of the year shows China secured 299 vessels totaling 7.13 million CGT, holding the top spot with a 52% market share; South Korea secured 104 vessels totaling 4.74 million CGT, ranking second with a 35% market share. China topped the monthly order list in January, March, April, and May.

According to Clarksons' data, in January, global new ship orders totaled 72 vessels and 1.96 million CGT, a significant year-on-year decrease of 63% in CGT terms. China secured 40 vessels totaling 1.124 million CGT, achieving a 57% market share and ranking first globally; South Korea secured 12 vessels totaling 0.64 million CGT, with a 33% market share, ranking second.

In February, global new ship orders totaled 58 vessels and 2.01 million CGT, a year-on-year decrease of 25% in CGT terms. South Korea secured 34 vessels totaling 1.56 million CGT, achieving a 77.6% market share and ranking first globally; Japan secured 9 vessels totaling 20.4 CGT, with a 10.1% market share, ranking second; China secured 9 vessels totaling 0.17 million CGT, with an 8.46% market share, ranking third.

In March, global new ship orders totaled 79 vessels and 2.43 million CGT. China secured 43 vessels totaling 0.95 million CGT, ranking first with a 39% market share; South Korea secured 15 vessels totaling 0.8 million CGT, ranking second with a 33% market share.

In April, global new ship orders totaled 80 vessels and 1.85 million CGT. China secured 62 vessels totaling 1.41 million CGT, ranking first with a 76% market share; South Korea secured 13 vessels totaling 0.38 million CGT, ranking second with a 20% market share.

South Korea's shipbuilding industry has seen its new ship order volume continuously suppressed by China this year, particularly in April, where China's lead exceeded 1 million CGT. The gap widened to 900,000 CGT in May, marking three consecutive months of defeat in the global new ship order competition. However, South Korean industry insiders attribute this to a selective order strategy, focusing on high value-added, environmentally friendly vessels such as LNG carriers, which are experiencing increased market demand. Therefore, one should not only focus on the negative aspect of South Korean shipbuilders receiving fewer orders than China, but also the positive aspects.

The insider stated that after securing a large number of orders over the past two years, South Korean shipbuilders have ensured sufficient workloads. Therefore, they prioritize order profitability over sheer order volume. In terms of backlog, Samsung Heavy Industries' Geoje shipyard ranks first globally with 9.95 million CGT, followed by Hanwha Ocean (formerly Daewoo Shipbuilding) Geoje shipyard and HD Hyundai Heavy Industries Ulsan shipyard in second and third place respectively. "The three major South Korean shipbuilders have secured workloads for the next several years, therefore focusing on high value-added vessels. This helps reduce unreasonable low-price orders, which can be viewed positively."

As of the end of May, global order backlog totaled 111.3 million CGT, a decrease of 0.19 million CGT compared to the end of April. Chinese shipbuilders held a backlog of 51.13 million CGT, accounting for 45% and ranking first; South Korean shipbuilders held a backlog of 39.1 million CGT, accounting for 35% and ranking second.

Furthermore, new ship prices continue to rise. As of the end of May, the Clarksons Newbuilding Price Index stood at 170.1 points, up 10.03 points year-on-year. By vessel type, a 174,000 cubic meter LNG carrier costs US\$259 million, a 14.1% increase from US\$227 million last year; a Very Large Crude Carrier (VLCC) costs US\$126 million, a 7.7% increase from US\$117 million last year; and a 22,000-24,000 TEU ultra-large container ship costs US\$222.5 million, an 8.3% increase from US\$205.5 million last year.

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