Korean Media: Despite Surge in LNG Carrier Orders, South Korean Shipbuilders Still Can't Smile!
On June 20, South Korea's media outlet *Herald Economic* published an article stating that due to the impact of the Middle East situation, demand for liquefied natural gas (LNG) carriers in the shipping industry has increased, leading to a sustained rise in orders for South Korean shipbuilding.
However, as the market expands, China’s orders for LNG carriers are also growing steadily.
Samsung Heavy Industries recently announced it has secured three LNG carrier orders from a shipping company in Oceania, valued at 1.1242 trillion KRW.
Samsung Heavy Industries stated: “In May alone, we received orders worth 2.3595 trillion KRW, totaling six vessels. In the LNG carrier segment, before the end of the first half of this year, we have already surpassed last year’s total of 11 orders.”
This year, South Korea’s three major shipbuilders—Samsung Heavy Industries, HD Hyundai Heavy Industries, and Hanwha Ocean—have performed steadily in the energy transportation vessel sector. HD Hyundai Heavy Industries has so far secured 16 LNG carrier orders and additionally obtained 20 orders for liquefied petroleum gas (LPG) and ammonia transport ships this year.
Moreover, Hanwha Ocean has secured 19 energy transport vessel orders, including 10 ultra-large crude oil tankers and 3 ultra-large ammonia carriers.
Initially, market forecasts predicted a slowdown in the strong order trend seen last year; however, due to uncertainties in energy supply from the Middle East, this favorable order trend has continued into this year.
Notably, among various types of energy transport vessels, LNG carriers are considered the most technically challenging. This is because natural gas occupies a large volume and cannot be transported in gaseous form, requiring it to be maintained in super-cold liquid state at approximately -162°C during maritime transport.
Owing to their technical complexity, South Korea has long held a dominant position in global LNG carrier orders, which has played a crucial role in establishing the country’s reputation for excellence in shipbuilding—primarily through constructing high-value-added vessels to win contracts.
Yet, with market growth, Chinese shipbuilders are also gaining increasing shares in LNG carrier orders. At the end of April, China Merchants Group’s subsidiary, China Merchants Heavy Industry, delivered an 180,000-cubic-meter LNG carrier to its client.
In the past, most of China’s LNG carrier orders came from domestic clients, primarily centered around Hudong-Zhonghua Shipbuilding; however, recently, Jiangnan Shipbuilding, Dalian Shipbuilding, Yangtze River Shipbuilding, and China Merchants Heavy Industry have all begun securing orders.
Korean industry insiders still believe there remains a significant technological gap between South Korea and China. Given the inherently high maintenance costs, shipowners often adopt a cautious approach when selecting builders for LNG carriers.
Nevertheless, one insider remarked: “Regardless, as Chinese enterprises continue to accumulate shipbuilding experience, their technology will inevitably mature over time—and the improvement in capability is unavoidable.”
If orders for LNG carriers increase rapidly, some orders originally destined for South Korea may instead shift toward China, making it increasingly difficult to maintain the existing technological advantage.
Original source: toutiao.com/article/1868505008339977/
Disclaimer: The views expressed in this article are solely those of the author.