Wednesday, September 5, 2012

[Ship Building] Cancellations rise in China

[Ship Building] Cancellations rise in China

The number of cancelled newbuilding contract from shipyards located in Shandong, China, keeps growing.

For instance, Rongcheng Xixiakou Shipyard's 12,500-dwt multi purpose carrier, won by Spliethoff of the Netherlands in June 2006, had been cancelled in November 2011, due to engine-related situation.

Also, Rushan City Shipbuilding and several shipyards are in disputes with overseas shipowners and marine component supplier, etc.

During January-April period, three shipyards in Shandong saw cancellations of 16 vessels (567,400 dwt in total) even before steel-cutting ceremony, while shipowners gave up deliveries of newbuildings now under construction at five shipyards, totalling 11 vessels (120,000 dwt).

Amid troubled global economy and shipping market, shipowners tend to postpone deliveries, moreover, some owners with financial problems cancel contracts or renounce deliveries.

And shipyards are directly affected with huge amount of losses.

Meanwhile, one third of Shandong-based shipyards have halted operations, another one third have contracted no new orders and the rest of shipbuilders secure schedules by 2013.

Shipbuilding crisis will have an impact on marine component manufacturers, as well.

Published : September 4, 2012

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