Friday, May 20, 2011

Orders edge up in April

Global new ship orders increased a bit last month and the investment in newbuildings also rose by more than 10% month-on-month.

According to a monthly report released by Clarksons on May 17, new ship orders stood at 93 ships of 5.4m dwt in April, just over February and March orders. 30 bulkers were booked last month and gas carrier orders reached 11.

And now, the accumulative new vessel orders worldwide by April came to 347 ships of 20.4m dwt while newbuilding deliveries hit 717 ships of 47.6m dwt.

In April newbuilding investment totaled $6.7bn, up 10.1% on March, but way below $12.2bn recorded in February.

By April, South Korean shipyards won new orders for 134 ships of 10.4m dwt worth $19.4bn while their Chinese rivals clinched 148 ships of 8.8m dwt worth $5.2bn.

During the first four months, South Korean yards delivered 154 ships of 15.7m dwt while Chinese rolled out 310 ships of 18.5m dwt. In April South Korean handed over 26 ships of 2.7m dwt while Chinese built 30 ships of 2.1m dwt.

World newbuilding orderbook has now fallen to 7,029 ships of 438.2m dwt worth $399bn as of May 1, down by more than 500 ships from the end of 2010.

South Korea occupies 1,467 ships of 143.4m dwt worth $148.2bn and Chinese are holding 2,993 ships of 184.7m dwt worth $120.9bn.

Meanwhile, by shipbuilders, Samsung Heavy Industries has the largest orderbook at 204 ships of 9.04m cgt followed by Hyundai Heavy Industries (including Gunsan yard) with 220 ships of 8.08m cgt and Daewoo Shipbuilding & Marine Engineering with 173 ships of 7.38m cgt.

Clarksons Newbuilding Price Index was unchanged as of April end at 141.2 points month-on-month. It is up 1.5% on a year earlier.

Published : May 20, 2011

Source: Asiasis


"Newbuild prices still going down"

Asian shipyards will be unable to translate rising costs into higher newbuilding prices amid surplus yard capacity, Seaspan chief executive Gerry Wang forecast this week.

He said this has left owners in a strong position to drive a hard bargain in the newbuilding market.

Although shipbuilders are paying more for steel plate and other materials, facing higher electricity prices and being hit by the weaker dollar, those costs will not translate into more expensive ships, said Mr Wang.

Newbuilding prices will be determined by supply and demand, with massive surplus yard capacity ensuring shipowners should continue to enjoy falling prices.

Yard prices “are not driven by cost,” Mr Wang said in a presentation to investors this week. “It is all to do with supply and demand.”

That is why New York-listed Seaspan, which is in talks with yards for a large number of new ships and has inked letters of intent, has not yet signed firm commitments.

“We are negotiating very hard to get what we want from the yards,” he said. “We are trying to squeeze them for as much as possible. We are being very tough.”

Mr Wang described the bargaining tactics Seaspan is pursuing with shipyards in South Korea and China as “revenge” for the skyhigh newbuilding prices of recent years. “That’s life,” he added.

If Seaspan did not take full advantage of the softer market conditions now prevailing as a result of excess yard capacity, the company would not be doing a good enough job, said Mr Wang.

He noted that, despite weaker shipping markets since the boom times of four or five years ago, shipyard capacity had continued to increase.

The shipbuilding industry had done nothing to curtail capacity as newbuilding demand slumped during the downturn in the container, dry bulk and tanker trades, said Mr Wang. Instead, new yards continued to spring up “like mushrooms”.

Published : May 20, 2011

Source: Asiasis


Daewoo builds shipyard in Indonesia

South Korea's Daewoo Shipbuilding & Marine Engineering plans to develop a 40-hectare land in Batam Island into a shipyard in partnership with state-owned shipbuilding firm PT Dok dan Perkapalan Kodja Bahari (DKB), Theindonesiatoday reports.

Amir Sambodo, special staff of coordinating minister for the economy, said Daewoo has offered cooperation with Kodja Bahari to develop the shipyard.

Amir said Daewoo and Kodja will also develop floating LNG terminal to serve LNG carriers.

"They're offering a cooperation with Dok Kodja Bahari," Amir is quoted.

He said that Indonesia needs more floating LNG terminals in Indonesia. "We should grab this opportunity, because South Korea is also willing to train our manpower," Amir said.

He declined to mention the amount of investment committed by Daewoo for its Indonesian venture.

Published : May 20, 2011

Source: Asiasis


Japan-Korea Q2 plate talks in final

It is reported that the price negotiation of Q2 ship plate between Japan and South Korea has been entering into the final phase.

It is said that South Korea's shipbuilding manufacturers have accepted the prices hike of USD 100 per tonne; however, Japan's steel mills have been seeking for larger price rise.

Japan's steel mills indicated that the shipbuilding manufacturers have received the fully booked orders for Q2, thus, they believed the demand for ship plate would remain firm.

Meanwhile, it is predicted that Japan's steel mills might cut the exports in the Q2 to ensure the sufficient supply for the domestic market.

Published : May 20, 2011

source: Asiasis


Thursday, May 19, 2011

EU widens probe

The list of top container lines being probed by the EU is growing. Half of the world’s top 20 lines, including the top six, have all had knocks at the door from EU officials.

Overnight OOCL, MSC, Hanjin and Evergreen were all added to the tally as non-EU headquartered companies were sucked into the drama.

They joined AP Moller-Maersk, CMA CGM, Hapag-Lloyd, Hamburg Sud and Neptune Orient Lines who captured the headlines yesterday.

While official statements about individual raids are plentiful today it is still not clear what spurred the Commission into action.

In a statement yesterday, the Commission said it had "reason to believe that the companies concerned may have violated the antitrust rules that prohibit cartels and restrictive business practices and the abuse of a dominant market position".

Published : May 19, 2011

Source: Asiasis


Big 3 eye "Bigger Offshore"

Sales in offshore businesses are fast catching up with shipbuilding revenues at South Korean big 3 shipbuilding companies.

They already started to win more new orders in the offshore sector.

Big 3, namely Hyundai, Samsung and Daewoo, won $22.1bn new orders in the shipbuilding and offshore sectors this year. Commercial ship orders took $8.5bn and offshore orders stood at $13.6bn.

Daewoo Shipbuilding & Marine Enginering won $4.47bn 66-ship orders last year but offshore order intake totalled 10 units worth $5.24bn.

During the past three years, Daewoo inked $13.33bn in merchant ship orders and booked $12.65bn in offshore and specialized ship sector.

Samsung Heavy Industries' offshore order intake during the past three years totalled $19.7bn covering drillships, offshore supply vessels and FPSOs. In the same period it won $14.7bn orders for standard ships and LNG carriers.

So far this year, Samsung won over $5.3bn in offshore orders while its total new order intake reached over $8.4bn now.

As new orders for offshore facilities are rapidly increasing, revenue is also reflecting the market trend.

Indeed, Hyundai Heavy Industries' shipbuilding sales accounted for 45.5% of the company's total sales in 2008 but it decreased to 42.6% in 2009 and to 35% last year.

Daewoo's shipbuilding proportion is also edging down from 68.5% in 2008 to 62.8% in 2009 and to 60.2% last year.

Published : May 19, 2011

Source: Asiasis

Cargotec bags electric crane orders

Shanghai Cargotec has bagged an order for 21 variable frequency drive (VFD) electric cranes to be installed on vessels being built in China.

The cranes will be installed on seven 28,000 dwt multi-purpose vessels being built at Huanghai Shipbuilding, China for Ethiopian Shipping Lines.

The cranes are scheduled for delivery between August 2012 and September 2013.

“We are seeing increasing interest in our electric cranes and deck machinery as more companies become aware of the economic, operational and environmental advantages they offer,” says Svante Lundberg, sales manager for cargo cranes at Cargotec.

Published : May 19, 2011

Source: Asiasis


Owners lured to scrap sales

 Dry bulk shipowners are becoming increasingly interested in demolition market, as current scrap prices of more than $500 per ldt provide healthy returns on elderly tonnage.

Prices achieved can even allow some owners to walk away with cash that can be put down as a deposit on modern secondhand tonnage.

Today’s demolition prices are making a lot of sense for the owners of the bigger bulkers, such as capesizes and panamaxes.

An owner of a 20-year-old capesize bulker now has daily operating costs of $10,000 per day and he is faced with a decision to either invest another $3m-$4m in a special survey and face a market returning just $6,000 per day compared with the incentives for scrap which could see them achieve around $12m.

It’s a relatively simple decision and we’re seeing an increasing flood of bulk carriers being sold for scrap every week, with 7m tonnes sold for scrap so far this year compared with 6m tonnes in all of 2010.

Published : May 18, 2011


Croatian plans yard buys

Croatian businessman Danko Koncar is still committed to buying domestic shipyards, but says he might shift some operations to China.

The London-based tycoon told Croatian national TV that he is still interested in buying the 3. Maj, Kraljevica and Trogir yards, but added: "There is a part of the Croatian shipbuilding industry I'd remove to China, where I plan to buy a shipyard as well. I'd also cut the administration."

He said part of Trogir would also be turned into a marina.

Koncar, who made his fortune investing in Russia during the 1990s and buying South African mines, could be too late with 3. Maj and Kraljevica.

Zagreb-based Jadranska Ulaganja has been selected as the preferred bidder for the two loss-making yards by the government.

Jadranska offered a token HRK 1 ($0.19) for 3. Maj, as well as assuming its debts. The country’s biggest shipyard lost $84m in 2009. It is thought a similar token bid was made for Kraljevica.

Published : May 18, 2011

Source: Asiasis

Boxship orders continue

With global trade now on a solid recovery path, containership owners have been investing heavily in new vessels.

Latest weekly report from Clarksons says, “In a move away from recent patterns the containership orders placed this week have been backed by the large liner companies, such as the NYK/OOCL deal for the Vessels at Samsung.

It will be interesting to see in the coming weeks and months if the other alliances, such as the New World Alliance or the CKYH Alliance will also work together to secure berths to order a longer series of ships for the bigger sizes.”

Hellenic owners were also quite active in the market, despite market fears of otherwise.

In total 13 new contracts were reported involving Hellenic ship owners, out of which 6 were in the bulk carrier segment by companies like Niki Shipping, Kyla Shipping and Everlast, while Costamare announced the contracting of 5 container post panamax carriers.

Technomar Shipping is said to have been in negotiations with South Korean yards for a series of wide, post panamax ships of 6,600 TEU.

“Whilst the container sector continues to lead the market in terms of ordering volume this year, there also remains a strong level of interest in the more niche sectors such as LNG and Offshore.

There are also some signs of demand in the tanker sector slowly shifting, with the level of enquiry starting to increase compared to the first part of 2011, however the current size of both the dry and wet orderbooks continues to stunt any significant level of enquiry in these sectors.

Nevertheless in China, with empty berths still abundant amongst the smaller yards and demand levels still relatively low, pricing continues to be under pressure for the foreseeable future and this could lead to a small revival in Dry sector ordering as the year progresses, but this will have to wait to be seen.

Published : May 18, 2011

Source: Asiasis

MAN expands in China

At a ceremony held on 18th May 2011, MAN Diesel & Turbo, manufacturer of large-bore diesel engines and turbomachinery, opened the second section of the construction work at its plant in Changzhou, China.

At this plant turbomachinery and turbochargers for large-bore diesel engines will in future be produced under a single roof for the Chinese market.

Until now, China's production of the turbochargers has been based in Shanghai. By relocating its production facilities to Changzhou, MAN Diesel & Turbo is looking to harness further synergies from the merger of the two former sister companies MAN Diesel and MAN Turbo.

With this move, MAN's Power Engineering Business Area is now represented at the Changzhou site with six activities: MAN Diesel & Turbo's share includes Oil & Gas, Process Industry, Systems Automation, Turbochargers and its After-Sales service, MAN PrimeServ.

Added to these is Renk, in which MAN SE holds a major shareholding and which specialises in the production of large gears, bearings, clutches and testing systems. The aim is to achieve a strong strategic position on the growth market of China.

In his opening speech, acting spokesman for the MAN Diesel & Turbo SE Executive Board, Dr. Hans-O. Jeske, was visibly impressed by the rapid progress of the project: "We laid the foundations for this plant in January 2007, and in November 2008 the first stage of the construction was inaugurated with perfect timing to celebrate the MAN Group's 250thanniversary.

Today, we are celebrating the completion of the second stage of the construction here in Changzhou. Each new international site for the company represents an important contribution towards the expansion of business relationships beyond national borders and thus towards globalisation, a phenomenon from which we can all benefit - including MAN."

The floor area of the plant in Changzhou, which is situated around 180 kilometres to the north west of Shanghai, has doubled with the construction of the new building to offer a hall size of a total of 20,000 square metres. The plant currently employs around 250 staff; in 2012, 400 employees will ensure that Chinese customers will be provided with the best products and services for their needs.

Dr. Martin Wilderer, Head of the Changzhou plant, believes that the ideal framework is already in place to facilitate this: "I'm absolutely delighted that the MAN Group is bringing together its Chinese production facilities in the Power Engineering sector here in Changzhou. This will benefit our Chinese customers, who can now not only obtain products and service locally but also from a single source, and it will also help MAN Diesel & Turbo, since the merger will provide new possibilities, opportunities and synergies."

For MAN Diesel & Turbo, China is a very important market. Virtually the whole of the company's product portfolio is of interest to Chinese customers, be it marine propulsion systems, decentralised and eco-friendly power plant solutions or turbomachinery for industrial applications. Alongside Brazil, China is one of MAN Diesel & Turbo's most sales and growth-intensive markets: the company earned 12 per cent of its revenue here in 2010.

Published : May 19, 2011

Source: Asiasis


Tuesday, May 17, 2011

Sungdong Wins FSO: Setting Milestone

Sungdong Shipbuilding & Marine Engineering has scored its first contract to build an offshore facility worth around KRW 70bn ($64m).

The South Korean shipbuilder announced today that it has won a contract to build one floating storage and offloading facility from PTSC (PetroVietnam Technical Services Company), a subsidiary of PetroVietnam.

The FSO booked at Sungdong has a length of 171.5 meters and a breadth of 32.4 meters with crude oil storage capacity of 350,000 barrels.

The unit accommodating 50 people is scheduled to be delivered in early 2013.

Following an order intake for shuttle tankers in March this year, Sungdong has successfully entered the offshore newbuilding market with the FSO deal.

Sungdong is the fifth shipbuilding company in South Korea to advance into the global offshore market following Hyundai Heavy Industries, Daewoo Shipbuilding & Marine Engineering, Samsung Heavy Industries and STX Offshore & Shipbuilding.

An official from the yard said, "Global offshore and shipbuilding industry is getting more focussed on larger and higher value-added vessels. Sungdong will also diversify its ship portfolio and eventually enter the offshore drilling and production facility sector like FPSO and drillship."

Meanwhile, PTSC, which ordered an offshore facility newbuilding in South Korea for the first time this time around, will deploy the FSO into the $800m Bien Dong 1 Project upon delivery.

Published : May 16, 2011

Source: Asiasis

Korean beef up cost-cutting

South Korean shipbuilders employ various measures to deal with recent sharp increase in thick steel plate prices.

Hyundai Heavy Industries put raw materials procurement and production process information into two-dimensional bar codes to share the information with about sixty outside subcontractors, making the most of raw materials management system.

Hyundai expects to save 2.9bn won (USD 2.65m) annually by using the system. It also decided to employ the "peak electricity system" which controls and cuts off the amount of electricity used for some facilities automatically from remote places, if the amount of electricity used increase sharply for a specific period of time.

Samsung Heavy Industries plans to minimize the use of thick steel plates through using optimized system from the design stage, expand the production automation in the welding and coating stage, and install high-speed internet access (wibro) facilities in its shipyards, thereby improving productivity in shipbuilding process.

Daewoo Shipbuilding & Marine Engineering plans to intensify its "Procurement & Supplier Management (PSM)" plan, which Daewoo started to implement in 2005, measures of cutting raw materials costs. PSM will maximize cost-cutting effect by systemizing all the procurement-related processes and establishing cost cutting strategies in each stage.

STX plans to cut costs by using standard steel plates which are cheaper than even steel plates. Also, it plans to conserve energy by introducing energy conserving, high efficiency inverters and electric transformers to its workplaces.

Published : May 17, 2011

Source: Asiasis