- According to Clarksons newbuild prices are experiencing the sharpest increase for almost two decades.
- Thanks largely to the extremely high number of containerships and LNG carriers ordered over the past 15 months.
A recent Splash 247 news source by Sam Chambers says that newbuild prices see sharpest increase for almost two decades.
Vessel newbuilding prices have been rising
Vessel newbuilding prices have been rising for over a year, and the overall Clarkson Newbuilding Price Index now stands at 156 points, up 25% since the November 2020 low, indicating the highest prices – in nominal terms – since 2009.
“The pace of increase has been rapid and the gain in our index over the last 16 months is the sharpest percentage rise over any equivalent period since 2005,” the latest weekly report from Clarkson Research Services stated.
Moreover, any owner wanting to order a ship today faces a considerable wait.
Shipyard forward cover increases
Shipyard forward cover has increased to 2.9 years from 2.4 in November 2019.
Despite the 25% increase in overall newbuild prices, shipbuilders are not making massive profits.
This is thanks to soaring costs. Steel prices, for instance, remain elevated after big increases in 2021.
Cost of Chinese steel plate
Chinese steel plate today costs around $800 per tonne, up by around $250 per tonne since April 2020.
“A basic inflation adjustment suggests that in ‘real’ terms newbuild prices are actually still below start 2016,” Clarksons suggested.
Rival broker BRS published an extensive annual markets report last week, which covered the massive amount of container and LNG orders last year and the increasingly full-up nature of most Asian yards.
Containerships orders jumped by more than 300% in 2021, BRS data shows with container carrier orders surpassing bulker and tanker orders for the first time in history.
86 large LNG carriers ordered in 2021
On top of that, there were 86 large LNG carriers ordered in 2021, an all-time record.
As a result of the ordering frenzy, BRS stated last week that most Chinese yards are now full for the next three years, with the situation similar in South Korea.
75% of the world shipbuilding production is now in the hands of just nine shipbuilding groups, BRS data shows.
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Source: Splash247
