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South Korean Shipbuilders’ Business Outlook Bright
About 100 LNG Ships Expected to Be Ordered in 2020
South Korean Shipbuilders’ Business Outlook Bright
  • By Jung Min-hee
  • December 18, 2019, 11:29
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Very large LPG carrier built by Daewoo Shipbuilding & Marine Engineering

Oil-producing countries such as Qatar and Saudi Arabia are expected to order about 100 LNG ships next year. South Korean shipbuilders, which have had a hard time this year, are preparing to turn the tables with the new orders next year.

Daewoo Shipbuilding & Marine Engineering announced on Dec. 17 that it signed a contract with Avance Gas to supply two very large LPG carriers. Each of the 91,000 cubic meter vessels will be built in Daewoo’s Okpo Shipyard and delivered in the first quarter of 2022.

This year, Daewoo obtained orders worth a total of US$6.11 billion, which include those for 10 LNG carriers, 10 very large crude carriers, five very large container ships, five submarines, and one offshore plant. The achievement is equivalent to 73 percent of its goal for this year.

Hyundai Heavy Industries Group set a goal of US$19.6 billion at the beginning of this year. It has met about 50 percent of the goal so far. The relatively lower ratio is because the company refused to aggressively engage in price competition.

Samsung Heavy Industries, which is aiming to reach US$7.8 billion this year, met 90 percent of the goal early this month. Its current business performance already topped last year’s, US$6.3 billion, and reached a five-year high, led by its US$1 billion offshore project signed in April this month.
 

The number of new ship orders fell no less than 37 percent this year. According to market research firms, new ship orders totaled 20.06 million CGT from January to November whereas the figure amounted to 31.72 million CGT in 2018 and 25.19 million CGT in 2017. The new orders dropped 76 percent last month alone.

Things are likely to change next year. The 100 or so LNG ships are expected to be ordered early next year. This year, LNG carriers have accounted for 38 percent of South Korean shipbuilders’ business performance. From January to November, a total of 43 LNG carriers were ordered worldwide and South Korean shipbuilders obtained 33.