S. Korea Shipbuilding Industry Rebounds As Global Orders Bundle In

South Korea’s shipbuilding industry is looking ahead to a prosperous year on the back of a global shipping volume recovery and heightened demands for eco-friendly vessels, industry data showed Monday.

Of the 10.25 million compensated gross tonnage in global shipping order quantity from January to March this year, South Korean shipbuilders accounted for 5.32 million or 52 percent of the global volume, the Ministry of Trade, Industry and Energy said Monday, citing data from global shipping information provider Clarksons Research.

This latest quarterly performance was not only a visible ten-fold rise from last year but also a rebound from the pre-coronavirus market situation in 2019.

“This year, the shipbuilding industry achieved the highest order quantity for any January-March period since the last industry boom in 2006-2008,” said a ministry official.

“The domestic shipbuilding sector, which was hit by the COVID-19 pandemic and the low global oil prices last year, is now entering a recovery phase.”

One of the factors fueling the rebound is the enhanced environmental regulations by the International Maritime Organization. It ended up playing out in favor of Korean shipbuilders who have an upper hand with their liquefied natural gas carriers and other high-tech, eco-friendly vessels, according to the ministry.

When it comes to LNG and LPG carriers, Korean players accounted for 2.21 million CGT or 78 percent of the global volume last year, up from 60 percent in 2019 and 63 percent in 2020.

Such favorable market circumstances have also raised expectations of a better business output for major shipbuilders this year, who have reeled under the COVID-19 pandemic fallout last year.

The world’s leading player Korea Shipbuilding & Offshore Engineering — which has Hyundai Heavy Industries and two more shipbuilding arms under its wing — secured orders for 68 ships in the first quarter. The total order amounted to $5.5 billion, which means KSOE has achieved 37 percent of its annual target of $14.9 billion.

Samsung Heavy Industries also clinched $5.1 billion in new orders during the same period, while Daewoo Shipbuilding & Marine Engineering bagged $1.79 billion.