Thursday, October 17, 2019
Korean Shipbuilders Reclaim 1st Spot in Order Receipts in 3 Months
On the Back of Strong Demand for LNG Carriers
Korean Shipbuilders Reclaim 1st Spot in Order Receipts in 3 Months
  • By Jung Min-hee
  • June 12, 2019, 09:12
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Korean shipbuilders reclaimed the number one spot in order receipts in May.

Korean shipbuilders reclaimed the number one spot in order receipts in May on the back of strong demand for liquefied natural gas (LNG) carriers.

Korean shipbuilders won orders for 640,000 CGTs (16 vessels) in May, accounting for 60 percent of the world's total shipbuilding orders, which reached 1,060,000 CGTs (34 vessels), British shipbuilding and shipping market research company Clarkson Research said on June 11. They were followed by Chinese competitors that landed orders for 270,000 CGTs (eight units, 26 percent). In March and April, China outperformed Korea. Japan received orders for 60,000 CGTs (three vessels) in May.

Korea could reclaim first place as orders for LNG carriers, Korean shipbuilders’ specialty, remained at a level similar to that of the average year amid a decline in shipbuilding orders throughout the world. Global shipbuilding orders for the first five months of this year totaled 9.41 million CGTs, down 38 percent from 15.22 million CGTs in the same period of last year. However, in the LNG carrier segment, 1.81 million CGTs (21 vessels) were ordered from January to May, almost the same as the 1.82 million CGTs (21 vessels) in the same period of last year.

In May, LNG carrier orders added up to 350,000 CGTs, up from 260,000 CGTs in April. In May, shipbuilding orders totaled 1,060,000 CGTs (34 vessels), down 26 percent from April's 1.44 million CGTs (49 vessels). Korean shipbuilders won all LNG carrier orders placed last month.

On the other hand, in May 2019, orders for very large crude oil carriers (VLCCs) and bulk carriers dropped sharply compared to last year. VLCC orders totaled 430,000 CGTs (10 vessels) in the January-May period of this year, a plunge of 73 percent from 1.60 million CGTs (37 vessels) during the same period last year. Bulk carrier orders also dropped 51 percent from 1.88 million CGTs (53 vessels) to 920,000 CGTs (27 vessels) during the same period.

In terms of ship prices, LNG carrier prices were high while those of other vessels were low. The price of an LNG carrier hit US$185.5 million, up US$500,000 from April. It has been on the uptick since hitting the bottom (US$180 million) in February last year. A VLCC cost US$93 million in May, the same price as in April, while the price of a container ship (13,000 TEUs to 14,000 TEUs) was US$111.5 million, down US$500,000 from April.