South Korea heading back to top as Asian yards struggle

Malcolm Latarche
Malcolm Latarche

10 January 2019

South Korea is back at the top of the world shipbuilding league after six years of playing second fiddle to China according to figures released recently by Clarksons.

Last year South Korean yards secured a combined total of 12.63 million compensated gross tons (CGTs) last year to account for 44.2% of 28.6 million CGTs for all global orders placed. In second place China notched up 9.15 million CGTs with Japanese shipyards winning orders totalling 3.6 million CGTs. Most of South Korea’s success was due to a run of LNG carrier orders.

In terms of overall orderbook China still leads with a backlog of 29.14 million CGTs, followed by South Korea and Japan with 20.9 million CGTs and 13.91 million CGTs, respectively.

Compensated gross tonnage is a measure of the value of orders based on the sophistication of different ship types. LNG carriers and cruise ships score much higher than bulkers and tankers. However in terms of deadweight which is also used to measure out put China was well ahead based on deliveries in 2018.

Total output from Chinese yards for all vessel types was 816 ships equating to 35,025,428dwt. Japan was second with 458 vessels for 20,271,675dwt and South Korea in third place with 215 vessels for 19,248,396dwt. In terms of deliveries, 2018 was not a successful year for South Korea with several yards struggling and receiving aid.

Elsewhere in Asia yards are also suffering with HHIC-Phil, the Philippines affiliate of South Korea’s Hanjin Heavy Industries and Construction having this week filed for court receivership. The yard in Subic Bay delivered its first vessel just ten years ago and was noted for being able to build some of the world’s largest vessel types including 20,000teu box ships. The yard does have work until the end of 2020 but has secure little in recent months.