Korea’s 2022 Market Lead Continues

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South Korea’s shipbuilding industry is continuing its strong run in booking new orders says The Maritime Executive.

  • KSOE Books $2.2B LNG order.
  • South Korea Continues to lead the marker.
  • Korea has come ahead of China for the first time in the past four years.

New Contracts

The parent company of Hyundai’s shipbuilding operations reported two new contracts with a combined value of $2.2 billion. With the order, the company has achieved its target for all 2022 while booking building slots into 2026. The new order is believed to be tied to the LNG expansion by QatarEnergy. It follows similar orders with KSOE’s two rivals, Samsung Heavy Industries and Daewoo Shipbuilding & Marine Engineering. QatarEnergy, 2020 reserved as many as 100 building slots with the three Korean shipbuilders for LNG carriers to be delivered by 2027.

Increase

KOSE reports that it received two contracts for a total of 10 LNG carriers, which followed what was believed to be a token order in June. This was for two LNG that analysts also linked to Qatar. The new order calls for eight 174,000 cbm gas carriers to be built at Hyundai’s shipyard in Ulsan and is due for delivery by November 2026. These orders compare with Samsung’s record largest single order which was announced in June. It was also split between a larger order of 12 ships and a smaller order of two ships. Qatar works through shipowners that own and operate the ships on charter to the Middle Eastern company. KSOE reported that these orders combined with previous orders received in 2022 total $17.3 billion. They have received orders for 134 vessels this year, including 34 LNG carriers. This is significant because they are higher-value ships that aid the shipbuilder’s profitability. The company said it has now reached 99% of its $17.44 billion targets for orders in 2022.

Change in received orders

As a whole, the Korean shipbuilding industry has been posting its strongest order flow in years in 2022. The Korean Ministry of Trade, Industry and Energy said this week that orders during the first half of the year were the highest level orders since the first half of 2011. With China’s shipbuilding industry struggling with COVID-19 lockdowns in 2022, the South Koreans were able to regain the lead in the industry. In the first half of 2018, South Koreans received 47% of the orders compared to China’s 40%. This year, the South Koreans received 45% of the total orders compared to China’s 43%. However, the Koreans continued to dominate the high-value segment with 62%t of the global total of 11.14 million gross tons. This is despite China’s efforts to grow in LNG and other more lucrative segments of the market.

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Source: The Maritime Executive

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