18-10-2016

New shipbuilding orders to rebound sharply in 2018: report

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The global shipbuilding industry’s protracted slump is expected to continue into next year, before seeing a recovery in 2018, according to a report compiled by a global researcher Monday.

According to the report by global research firm Clarkson Research Services, this year’s new ship orders around the globe are estimated at 586 vessels, but the comparable figure for next year will be 790.

Over the past 20 years, global shipbuilders received an annual average of 2,200 new ship orders.

“If Clarkson’s forecast is correct, the global shipbuilding sector will have another tough year,” said an industry source.

The market researcher forecast that orders for an estimated 1,300 ships are expected to be placed in 2018, and the number may rise to 1,667 in 2019 and 1,869 in 2020.

Clarkson said demand for oil tankers will not be feeble next year, despite the current increased supply of new ships. Demand for container ships will improve, while that for LNG carriers is expected to remain firm on a slew of big projects, it said.

South Korean shipbuilders have been under severe financial strain since the 2008 global economic crisis, which sent new orders tumbling amid a glut of vessels and tougher competition from Chinese rivals.

The country’s top three shipyards — Hyundai Heavy Industries, Samsung Heavy Industries Co. and Daewoo Shipbuilding & Marine Engineering Co. — suffered a combined operating loss of 8.5 trillion won last year. The loss was due largely to increased costs stemming from a delay in the construction of offshore facilities and an industrywide slump, with Daewoo Shipbuilding alone posting a 5.5 trillion-won loss.

The shipbuilders have recently drawn up sweeping self-rescue programs worth 10.35 trillion won in desperate bids to overcome the protracted slump and mounting losses.

Source: Yonhap

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