The Korean shipbuilding industry is moving closer to achieving this year’s order-taking target based on stable orders. Korean shipbuilders are concentrating on boosting profitability by selectively winning orders for liquefied natural gas (LNG)-powered carriers, which are regarded as high-value ships.
According to industry sources on April 5, the three major Korean shipbuilders took orders worth US$10.5 billion (13.82 trillion won), which is 33 percent of their combined order target of US$32 billion (42.11 trillion won) for this year in the first quarter of 2023.
The amount of orders for Korea Shipbuilding & Offshore Engineering (KSOE) in the first quarter amounted to US$7.28 billion. It reached 46.3 percent of its annual order target of US$15.74 billion. Samsung Heavy Industries also signed a contract to build two LNG carriers for a shipping company in the Asia Pacific region on March 31, winning a total of US$2.5 billion in orders in the first quarter. It attained 26 percent of its annual target (US$9.5 billion). Daewoo Shipbuilding & Marine Engineering (DSME)’s first quarter order intake stood at US$800 million, or 11.5 percent of its target.
Demand for LNG carriers, which are subject to selective orders, is expected to continue going forward. Clarkson Research, a shipbuilding market analysis agency, expected about 70 new orders for LNG carriers in 2023 alone. It is also predicted that demand will continue to rise with an annual average of 60 orders by 2032.
As the prices of expensive LNG carriers continue to rise, it is expected to contribute to raising shipbuilders’ profitability. The price per LNG carrier exceeded US$250 million as of the end of February. Compared to February 2021 when it stood at US$ 187.5 million, it rose 33 percent.
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