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The roar of machinery has been resounding throughout the new area of Jiangsu Taizhou Port Shipping Co., Ltd., with huge gantry cranes, which will transport thick steel from time to time. This is an orderly shipbuilding company, busy is the usual normal. However, more shipbuilding companies are still struggling in the quagmire of lack of orders.
According to data released by the China National Shipbuilding Industry Association, in the first quarter of this year, China’s shipbuilding industry orders fell sharply. From January to March, China's orders for new ships were 4.59 million DWT, down 70.4% year-on-year; at the end of March, orders for hand-held ships were 84.28 million DWT, down 10% year-on-year, down 5.6% from the end of 2018.
This is very different from the brilliant results of January. According to reports, in January this year, the cumulative number of new shipbuilding orders in the world was 2.14 million revised gross tons, a total of 78 ships, China ranked first with 1.08 million revised gross tonnage; South Korea ranked second; Italy and Japan ranked third, fourth Bit.
"Some major shipbuilding enterprises in China have increased their orders, and their results have been well reflected in January. In addition, in the past two years, China's shipbuilding industry has effectively reduced excess capacity, product structure has continued to optimize, and innovation capabilities have continued to improve. The competitiveness of the shipbuilding enterprise has been strengthened, and the ability to take orders has been correspondingly enhanced.” Chen Wenbo, director of the Research and Cooperation Department of the China Shipbuilding Industry Association, said.
But no one thought that the shipbuilding industry Xiaoyangchun was so short.
"The bottom of the shipbuilding industry is a long-term one. The clearing will take 10 years, 20 years and 30 years or more. At present, domestic shipbuilding is definitely the bottom 10 years ago, but this bottom is probably still going to continue." Billion Blue (Beijing) Lin Shulai, general manager of the Data Big Data Division of Data Technology Corporation, told the China Times reporter.
Explore the bottom again
After a brief recovery, the shipbuilding industry once again ushered in a downturn.
According to data released by China Shipbuilding Industry Association, from January to March 2019, the international shipping market fluctuated at a low level, and the global new ship orders fell sharply year-on-year. China's shipbuilding completions have continued to grow, but new orders and hand-held ship orders have fallen year-on-year. From January to March, the nation's shipbuilding completed 9.62 million deadweight tons, an increase of 12.8%. The orders for new ships were 4.59 million DWT, a year-on-year decrease of 70.4%. At the end of March, orders for hand-held ships were 84.28 million DWT, down 10% year-on-year, down 5.6% from the end of 2018.
“Although the completion of the increase is obvious, it is based on the previous orders, and the new orders will better explain the future trend.” A person in charge of the shipbuilding company told the China Times reporter.
For a large shipping vessel, the production preparation cycle is long, and it usually starts after the order is taken for 10 months. That is to say, the production in the previous year is the order of the previous year or even the previous year. Therefore, 2019 is destined to be a busy year. They have to complete the order signed ten months ago.
The reduction in orders means that the wind has changed.
In fact, from 2014 to 2016, for three consecutive years, the shipyard's orders were not satisfactory. Especially in 2016, the sluggish new shipbuilding demand led to a significant reduction in the number of new ship orders in most ship types in the world. At the lowest level in more than two decades, some shipowners gave up their deposits and already completed ships. For a time, the shipyards held a large number of well-built or unmade ships, but they could not receive the final payment. The flow of funds broke and had to close down. Among the cold currents, China's well-known shipbuilding enterprises - Dongfang Heavy Industry, Haotian Shipbuilding, Rongsheng Heavy Industry and other large number of shipbuilding enterprises have gone bankrupt.
"The ship companies can't get orders, and the companies have closed down. There are both factors in the downturn in the shipping market, and more mainly due to overcapacity." Liu Wenzhong, general manager of Ningbo Xinle Shipbuilding Co., told reporters that when it comes to bulk carriers, when this When there was a surplus in the market, we gave up the dry bulk carrier business for ten years in a timely manner, with a focus on small natural gas carriers. Because of the serious overcapacity, coupled with low technical thresholds and high degree of homogenization, dry bulk carriers have no profit at all.
Li Shengjiang, deputy director of CSSC Economic Research Center, remembers that from March 2007 to March 2018, the number of active shipyards worldwide dropped from more than 900 to 354. In his view, most of the more than 500 inactive shipyards have embarked on the road to bankruptcy or transformation.
"The different participants in the market are different. I am afraid that many people will withdraw a lot after 11 years, and the majority of the state is integrated and reorganized." Lin Shulai said.
South Korea and China's shipbuilding industry, which built a large number of new shipyards during the heyday, began to experience a crisis of capital chain breaks. Even Daewoo, one of the three major shipbuilding companies in South Korea, almost went bankrupt, and finally relied on financial institutions and government bailouts.
The confidence of the shipbuilding industry has not recovered after the market improvement in 2017. Until 2018, the shipyard's business continued to improve. Shipbuilding Industry Association data show that in 2018, the national shipbuilding completed 34.58 million DWT, down 14% year-on-year; the new ship orders 36.67 million DWT, an increase of 8.7%; at the end of December, the hand-held ship orders 89.31 million DWT, a year-on-year increase 2.4%. The gratifying financial data of each family seems to tell people that the market is recovering.
However, in the last month of 2018, the shipping price of the ship has suddenly become fascinating. The Baltic Index of the global shipping industry has also been swayed within a month.
Integration acceleration
For the Chinese shipbuilding industry, the bad news comes not only from the decline in the market.
The data show that from January to March, the national export ships accounted for 96.6%, 90.2% and 90.8% of the national shipbuilding completion volume, new orders received, and hand-held orders. The lifeblood of China's shipbuilding industry is almost entirely on the export. However, in international competition, China is facing a very serious situation.
On March 8, South Korea's Hyundai Heavy Industries merged with Daewoo Shipbuilding to enter the final review. Daewoo Shipbuilding's largest shareholder, Korea Industrial Bank (KDB), signed a contract with Hyundai Heavy Industries Co., Ltd. to transfer shares to Hyundai Heavy Industries. By the end of 2018, Hyundai Heavy Industries and Daewoo Shipbuilding ranked the top two in the world in terms of orders, accounting for 13.9% and 7.3% of the global market share, respectively.
The world's first to annex the world's second, the global shipbuilding giant is about to be born. This has caused huge waves in the global shipbuilding industry.
As early as January 31, Hyundai Heavy Industries Group announced that it would raise approximately 2.09 trillion won (approximately RMB 12.6 billion) through paid capital increase to acquire a 55.7% stake in Daewoo Shipbuilding held by Korea Industrial Bank and establish a new shipbuilding Comprehensive legal person. According to Clarkson's data, this means that after the merger of the two companies, the new company will occupy 21.2% of the global shipbuilding market and will become an undisputed giant in the global shipbuilding industry with overwhelming advantages. If the transaction is finally successful, the newly born "Super Monster" will bring great impact to Chinese and Japanese shipbuilding companies.
According to the data, Hyundai Heavy Industries and Daewoo Shipbuilding's main products are liquefied natural gas (LNG) vessels, super large crude oil carriers (VLCC) and naval vessels. Taking into account the competitive advantage in the LNG ship market, Daewoo Shipbuilding's 2019 order increase target was raised to 8 billion US dollars, an increase of 17%. Hyundai Heavy Industries Group will also receive orders, from $13.2 billion last year to $15.9 billion.
This is a blow to the Chinese shipbuilding industry. At present, orders for 90% of the world's largest oil tankers are picked up by Koreans, and the most technologically liquefied natural gas vessels are almost monopolized by Korean companies.
"Intensification is an inevitable trend in the development of shipping logistics."
In the past 10 years, from the perspective of the total amount and variety of global seaborne trade, there are also many opportunities for development in the cold winter. The total volume of maritime trade rose from 8.64 billion tons to 11.9 billion tons, an increase of 37%. Among them, iron ore shipping volume increased by 76%, coal shipping volume increased by 56.9%, dry bulk shipping volume increased by 48%, crude oil shipping volume increased by 6.8%, container shipping volume increased by 51%, and liquefied natural gas shipping volume increased by 94%. From the data point of view, the highest growth in maritime transport is LNG, but the new ship orders in this market, due to higher technical requirements, are almost all captured by South Korea.
However, China's shipbuilding industry has also been integrated, and the concentration of domestic shipbuilding industry is continuously improving. In 2018, the top 10 enterprises in the country accounted for 69.8% of the total shipbuilding volume, an increase of 11.5 percentage points over 2017.
It is understood that Yihailan is committed to building a shipping logistics ecosystem under the Internet, which will help enterprises in the ecosystem to form a competitive advantage and promote industrial intensive development. In 2018, the company achieved operating income of 1.035 billion yuan, an increase of 177.84%; net profit of 3.197 million yuan, an increase of 417.47%. According to the annual report, the company's operating income increased rapidly compared with the same period of last year. The main reason was that the platform business with logistics, collection and finance as the core continued to expand during the reporting period, and the platform effect gradually appeared. The main reason for the increase in net profit was the reporting period. The company’s operating profit was a loss in the same period last year.
In addition, the recent resurgence of the North-South ship merger has revived, and the Chinese shipbuilding industry is also welcoming the era of head players. Some media said that the merger of CSSC and China Shipbuilding Heavy Industry Group was approved in principle by the State Council, which deepened the market's expectation of the North-South ship merger.
Hu Keyi, chief engineer of Jiangnan Shipbuilding Group of CSSC, said to the media that the strategic reorganization of shipbuilding is not necessarily a simple merger of enterprises on the basis of the original split, but should be the integration and integration of functions and professions. More in line with the high-quality development strategy of manufacturing.
Liu Zheng, chairman of China Shipbuilding Heavy Industry Co., Ltd., said to the media that as an export-oriented industry, the Chinese shipbuilding industry faces competitors mainly from the international market. He believes that in the current domestic shipbuilding overcapacity, the development of supply-side structural reforms is of great significance for improving international competitiveness.
