Tuesday, May 26, 2020
Korean Shipbuilders Win Big Orders near Year’s End
All-out to Land More Orders
Korean Shipbuilders Win Big Orders near Year’s End
  • By Jung Min-hee
  • December 23, 2019, 11:03
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An LNG carrier built by Hyundai Heavy Industries

Korean shipbuilders are pulling out all the stops to land more orders as the year nears its end.

Hyundai Heavy Industries Group announced on Dec. 22 that it has signed a US$376 million contract for two 174,000-cubic-meter LNG carriers with an overseas shipping company.

The vessels ordered this time are 299 meters long, 46.4 meters wide and 26.5 meters tall and will be powered by dual-fuel engines which will greatly enhance their operational efficiency. These ships will be built by Hyundai Heavy Industries in Ulsan and delivered to the client in the second half of 2022.

Hyundai Mipo Dockyard, a subsidiary of Hyundai Heavy Industries Group, has also recently won a US$127 million order for two gas carriers from a U.S. shipping company.

The group won orders for 18 ships worth US$2.2 billion over the past one week. On Dec. 16, it received orders for one PC ship on Dec. 16, five oil tankers and one LPG ship on Dec. 17 and six LNG carriers and one LPG ship on Dec. 18. These deals helped the group attain 74 percent of its order goal for this year, up from 40 percent at the end of the third quarter of this year.

Daewoo Shipbuilding & Marine Engineering (DSME) also won big orders this month. The shipbuilder clinched an order for two very large gas carriers (VLGCs), the first time in four years to be awarded an LPG vessel order. It also received an order for a semi-submersible crude oil production facility from Chevron in the United States, the first time in five years since 2014 to win an offshore plant project. It has attained 73 percent of this year’s order goal.

Samsung Heavy Industries is likely to be the first to reach its annual order goal among the three major shipbuilders in Korea. This month, the shipbuilder received orders worth a total of US$7.1 billion, including orders for ice-breaking oil carriers. It has reached 91 percent of its order goal for this year (US$7.8 billion).

The three Korean shipbuilders’ order-taking performances are impressive in light of the sluggish global shipbuilding market. Global shipbuilding orders from January to November this year were 20.06 million compensated gross tons (CGTs), down from 31.72 million CGTs in 2018 and 25.19 million CGTs in 2017, said Clarkson Research, a shipbuilding market analysis firm in the United Kingdom. The drop is attributed to the trade dispute between the United States and China, which caused a contraction in world trade volume. Ship owners put off placing their orders ahead of the International Maritime Organization’s enforcement of new environmental regulations from Jan. 1, 2020.