Korean media: China has secured a major order, and the monopoly of South Korean LNG carrier ships is beginning to waver!
On February 20, Korean media Newsis published an article stating that China is launching a low-price campaign in the liquefied natural gas (LNG) carrier market, which has been dominated by South Korean shipyards until now.
Although it has not yet reached a significant level, the industry is concerned that this may affect the future new shipbuilding plans of South Korean shipbuilding companies.
However, if the number of North American LNG projects increases significantly, the price of new shipbuilding is expected to rise again.
According to industry insiders, Chinese shipyards have recently signed or are negotiating contracts for as many as 12 LNG carriers.
Recently, Singapore's East Pacific Shipping Company (EPS) ordered two LNG carriers from China's Jiangnan Shipyard.
The global energy company Shell has signed a charter contract with China's Shandong Marine Transport, which is currently negotiating with China's Jiangnan Shipbuilding Group to build four LNG carriers.
Greek TMS Cardiff Gas Company has ordered up to six LNG carriers from China's Shanghai Hudong-Zhonghua Shipbuilding. This is the first time that TMS Cardiff Gas has ordered LNG carriers from a Chinese shipyard.
Due to the low prices, global shipowners are increasingly turning to Chinese shipyards for LNG carrier orders. The recent orders for LNG carriers from South Korean shipyards are worth 250 million US dollars.
While Chinese shipyards offer quotes below 230 million US dollars, which means a discount of over 8%.
The emergence of Chinese low-price LNG carrier orders is unfavorable for the South Korean shipbuilding industry. If the price of new LNG carriers continues to decline, the profitability of companies will decrease.
Han Seung-han, a researcher at SK Securities, said: "Chinese shipyards are obtaining orders from global shipowners rather than Chinese shipowners, which is worrying in the medium to long term."
Industry analysts predict that the launch of North American LNG projects could lead to another surge in new shipbuilding prices. Given the limited short-term delivery schedules of Chinese shipyards and the U.S. containment policy towards China, South Korean shipbuilding companies are more likely to secure orders.
A South Korean industry insider said: "Last year, the decline in LNG carrier orders led to a drop in overall new shipbuilding prices. If LNG projects continue this year, orders will increase, causing a shortage of shipbuilding docks, which naturally leads to price increases."
Original article: toutiao.com/article/1857645766595595/
Statement: This article represents the views of the author.