Page 8 - GLNG Week 02 2023

GLNG ASIA GLNG

South Korea still

dominates LNG

carrier market

TANKERS SOUTH Korea’s so-called ‘big three’ shipbuild- with Korean firms last year compared to 2021.
ers are continuing to make their mark on the igures posted at the end of December indi-
global LNG carrier market, having secured a cate that just over 10.1mn tonnes of LNG carriers
total of 10.12mn gross tonnes in fresh orders were ordered from the Korean ‘big-three’.
throughout the 12 months of last year. This number represents a full 70% of the
At the same time as relinquishing their global LNG carrier orders for the year.
long-held ranking as the number one nation Speaking to local Korean media, one ship-
in terms of total ship orders, Daewoo Ship- building official in the Seoul said “Korea’s three
building & Marine Engineering Co. (DSME), big shipbuilders hardly have room to take more
Korea Shipbuilding & Offshore Engineering orders, as their dockyards are almost fully
Co. (KSOE) and Samsung Heavy Industries booked for ships scheduled for delivery by the
Co. (SHI), as compensation, now control 70% of end of 2026.”
the global LNG carrier market. The remaining 30% of orders up to the end of
The worldwide figure for gross shipping ton- 2022, 4.4mn tonnes in all, went to Chinese yards.
nage ordered in 2022 totalled 41.93mn tonnes. Increased tonnage for the year aside, there are
Figures in the LNG carrier sector notwith- indications that Chinese shipyards are clawing
standing, some in Seoul are concerned, however, back in the carrier market, though.
that the total market share secured by tonnage Overall market share for the 12 months to
going to Korean shipyards dropped by 11% year December saw South Korean dominance plunge
on year. from 93% in 2021, to just 70% this year, with
Much of this drop, though, is put down to Chinese numbers rising substantially from 7%
increased carrier orders placed by Chinese oper- to 30%.
ators with their own domestic shipbuilders as a It is a trend that may well continue past the
result of government pressure to help increase middle of the decade if Seoul is unable to add to
numbers at home. existing shipyard capacity on the Korean Penin-
Overall shipping orders won by China based sula, with yards already operating at full capacity
shipbuilders reached 20.34mn tonnes by the end and order sheets full for the next four years.
of the year, which amounted to 49% of the global Another option likely to be considered is
total, as against the 37% of overall orders taken a reduction in the less profitable size of con-
by their competitors in South Korea. tainer ships which currently account for 27%
In head-to-head competition, many shipping of all shipbuilding contracts at South Korean
industry operators prefer Chinese shipyards in shipyards.
order to lock in lower delivery prices on the back LNG carriers, seen as more profitable overall,
of cheaper labour costs. at present account for 65% of all vessels on order
In South Korea, meanwhile, where labour across the peninsula.
costs are significantly higher than across the Numbers for container ships are similar in
Yellow Sea, shipyards employ more technologi- China, but with LNG carriers making up just
cally superior construction techniques, and offer 22% of Chinese orders, Beijing is poised to adjust
faster turnaround times from initial placement yard output in the coming years by cutting down
of order to actual delivery, according to sources. on either smaller-scale container ships or bulk
It is this technological superiority that saw a carriers in favour of the currency-generating
huge 130% increase in LNG carrier orders placed LNG carriers.™

P8 www. NEWSBASE .com Week 02 12•January•2023