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Korean Shipbuilders Take Lion’s Share in LNG Carrier Orders
Greek Shippers Rush to Place Orders
Korean Shipbuilders Take Lion’s Share in LNG Carrier Orders
  • By Michael Herh
  • November 21, 2018, 09:33
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Korean shipbuilders have been sweeping increased orders for LNG carriers this year.

This year, Korean shipbuilders have been hogging LNG carrier orders, which more than tripled from last year.

According to Clarkson, a shipbuilding research company in the U.K. on Nov. 20, LNG carrier orders from January to October this year totaled 43 units or 6.8 million cubic meters, a three-fold increase from a year earlier.

Greek shipping companies triggered the sudden spike in orders. They ordered 22 ships or a total of 3.8 million cubic meters, accounting for 56% of the new orders placed this year.

The increase in LNG tank orders is attributable to a rise in charter fees charged by vessel owners. Ship supply to shipping companies is limited compared to an increase in LNG cargo volume so shipping companies’ leasing cost is ballooning. Until the beginning of the year, the spot fare of a 160,000-cubic-meter LNG tanker had been US$78,000 per day on average, but recently skyrocketed to US$190,000.

Clarkson analyzed that maritime LNG transport volume will grow more than 10 percent this year compared to last year. This positive outlook on the shipping industry has been prompting Greek shipping companies to place orders for LNG carriers.

During the January-October period of this year, LNG carriers accounted for 16 percent of the world's new investment in shipbuilding. They ran a second to cruise ships.

Korea’s top three shipbuilders are benefiting from this trend in the global market. They have received orders for 38 LNG carriers or 6.6 million cubic meters so far this year. This is the largest amount of orders for LNG carriers in the Korean shipbuilding industry since 2007.

An LNG carrier currently costs around US$182 million. As offshore plant orders have disappeared, LNG carriers are the most expensive ship type built by Korean shipbuilders. Industry analysts expect LNG carrier prices to rise steadily until next year.