South Korea’s share of orders in the global shipbuilding market is likely to hit an eight-year low following 2016.
According to Clarksons data, from January to November this year, the global market ordered a total of 60.33 million compensated gross tonnage (CGT) of new ships, of which South Korea’s cumulative orders were 10.92 million CGT (248 ships), with a market share of only 18%.
For the full year, South Korea’s shipbuilding industry’s share of global orders is expected to be below 20%, which would be the lowest level since 2016 (15.5%).
As the main competitor, China has an order volume of 41.77 million CGT (1,518 ships), with a market share of 69%, more than four times that of South Korea. Currently, the order gap between China and South Korea is 30.85 million CGT, and it is expected that the order gap between the two countries this year will reach a historical high.
South Korean media reported that South Korean shipbuilders have to selectively accept “high value-added” orders because their docks are full and they have accumulated more than three years of orders. However, there are also views that in order to improve market competitiveness, South Korean shipbuilders should continue to accept basic orders.
Although the gap between South Korea’s shipbuilding and China’s shipbuilding is widening, South Korea’s three major shipbuilding companies have performed well this year.
HD Hyundai (which has three shipyards, HD Hyundai Heavy Industries, HD Hyundai Mipo, and HD Hyundai Samho) has so far secured $20.56 billion orders, realizing 152.2% of its annual order target of $13.5 billion. Samsung Heavy Industries and Hanwha Ocean also performed well, receiving orders worth $6.8 billion and $8.15 billion respectively.