Tuesday, April 3, 2012

Shipbuilding market "Turnaround?"

Shipbuilding market would possibly make a turn-around soon, said Hyundai Securities of South Korea on March 2.

According to analyst Bang Jong-Uk, Hyundai, shipping market is likely to rebound, China Containerized Freight Index (CCFI) having increased by 19%. Recovery in shipping market, particularly in container ship sector, would boost shipbuilding industry to turn around, as well.

Hyundai's Bang said, "Korean shipbuilders contract proportion on offshore facility is pretty high. In the near future, along with high oil price, shipbuilders would be benefited from surging demand for offshore facility."

Bang added, "High scrapping would also improve depressed market. In 2011, scrapping stood at a cumulative 39.5m dwt, up by 54.4% year-on-year and February 2012 recorded the monthly highest scrapping since 2003 with 5.3m dwt."

He also said that as liquidity crisis from Europe having relieved, contract cancellation risks would be reduced.

Published : April 2, 2012

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