Lots of Work
Hyundai Samho Heavy Industries, a subsidiary of HD Korea Shipbuilding & Offshore Engineering (KSOE), has received orders for 30 ships worth US$5.08 billion (approximately 6.75 trillion won) in just over three months this year. This is an amount that exceeds the company’s sales of 4.6464 trillion won (US$3.4824 billion) in 2022. As Hyundai Samho Heavy Industries’ order target for this year was US$2.6 billion, the shipbuilder has already attained 195 percent of this year’s order target.
Most of the ship orders that Hyundai Samho Heavy Industries won until April 20 are those for eco-friendly ships. Of the 30 ships, 19 run on methanol, seven use liquefied natural gas (LNG) as their fuel, and two are powered by liquefied petroleum gas (LPG).
Hyundai Mipo Dockyard also exceeded its quarterly order target. The company’s order target for this year is US$3.7 billion. The number of ships ordered by April 20 reached US$1.17 billion. HD Hyundai Heavy Industries or HD HHI has received orders worth US$1.47 billion as of this day, thoroughly selectively receiving orders. Although it accounted for only 15.4 percent of its annual target amount (US$9.54 billion), nine out of 10 ships ordered were LNG/LPG ships, and most of them are high value-added ships. HD KSOE subsidiaries swept more than half of the world’s orders for methanol-powered ships this year.
Other Korean shipbuilders such as Samsung Heavy Industries are also joining the order-taking boom. Samsung Heavy Industries has won orders for ships worth US$2.52 billion, exceeding one-fourth of its annual target amount (US$9.5 billion). In particular, it won an order for a floating liquefied natural gas (FLNG) facility. This FLNG order is likely to give additional orders as FLNG projects usually involve many related projects.
Only Daewoo Shipbuilding & Marine Engineering (DSME), which has been unable to actively seek orders due to its merger with Hanwha Group, is faltering by winning orders for five ships worth US$1.06 billion. Judging from progress in taking orders, it falls slightly short of this year’s target amount (US$6.98 billion).
Korean shipbuilders swept 70 percent (10.12 million CGT) of the 14.52 million CGT (standard cargo carrier converted tonnage) of LNG carriers ordered worldwide in 2022. Korea reaffirmed its position as a global powerhouse in LNG carrier manufacturing technology. High energy prices are also expected to have a positive impact on Korean shipbuilding orders. This is because the higher the energy price becomes, the greater the demand for Korean ships with excellent fuel efficiency. In fact, Chevron, a U.S. oil refiner, is expected to place orders for six LNG carriers in 10 years and Qatar Energy up to 12 Q-max LNG carriers. Considering ordering plans of energy companies, additional orders are expected to go to the three Korean shipbuilders.