China's Shipbuilding Industry Accounts for65.6% of Global Orders; Green Technology Breakthroughs Reshape IndustryLandscape

On September 22, Yangzijiang ShipbuildingGroup's New Yangzi Shipbuilding delivered the first 8,000 TEU container ship"KMTC DAMMAM". Equipped with a hybrid desulfurization system, thisnew-generation eco-friendly vessel marked the start of an intensive deliveryweek in the shipbuilding industry. Shipbuilding developments at home and abroadduring the week showed that China continues to lead the global market, SouthKorea is accelerating industry consolidation, adjustments to IMO regulations havetriggered a chain reaction across the industrial chain, and breakthroughs ingreen technology are reshaping the industry's competitive landscape.

Domestic Shipbuilding Industry: DeliveryHits New Highs, Green Technology Becomes Core Competitiveness

Domestic shipbuilding enterprises usheredin a delivery peak this week. The "KMTC DAMMAM" delivered onSeptember 22 can not only carry 800 refrigerated containers and reach adesigned speed of 21.5 knots, but also comply with the world's latestenvironmental standards through a combination of a hybrid desulfurizationsystem and an EGR denitrification system. On the same day, the kitchen systeminstallation of the second domestically-made large cruise ship at WaigaoqiaoShipbuilding was completed, six months ahead of the schedule of the first ship,with a 20% increase in installation efficiency. This indicates a significantimprovement in China's construction efficiency of high-end ships.

In terms of technological breakthroughs,the "Shandong Xinsheng", China's first 82,000 DWT bulk carrierequipped with a carbon capture system, was delivered on September 27.Meanwhile, Wuchang Shipbuilding named the 25,900 DWT methanol dual-fuelstainless steel chemical tanker "Xingtong Haishi". As China's firstmethanol-powered ship of this tonnage class, it is equipped with a dual-fuelmain engine and stainless steel cargo holds, with an energy consumption of 5.3liters per kilometer, 42% lower in cost than similar diesel-powered ships, anda range of 1,500 kilometers. Wang Dongbo, Deputy Secretary-General of the ChinaAssociation of the National Shipbuilding Industry (CANSI), put forward the"Three Chinese Solutions" at the London International Shipping Week,emphasizing that China ranks first globally in receiving orders for green shipsand has the capability to become the world's largest producer of green fuels.

Market data shows that China's shipbuildingindustry continues to maintain a global leading position. According to datafrom Clarksons Research, in August, the global new ship orders reached 142ships / 3.48 million CGT, of which Chinese shipyards undertook 106 ships / 2.28million CGT, accounting for 65.58%. As of September 10, China's hand-heldorders stood at 4,080 ships / 100.92 million CGT, accounting for 66.67% of theglobal total. CANSI predicts that China's shipbuilding completion volume willreach 51 million DWT in 2025, with hand-held orders remaining above 230 millionDWT.

International Landscape: IMO RegulationAdjustments, South Korea Accelerates Industry Consolidation

The 11th session of the IMO Sub-Committeeon Ship Systems and Equipment (SSE) concluded this week, and its keyresolutions have attracted great attention from the industry. The effectivedate of the International Code for the Construction and Equipment of ShipsCarrying Liquefied Gases in Bulk (IGC Code) has been postponed from January 1,2028 to July 1 of the same year. The Revised Draft Interim Recommendations onthe Transport of Bulk Liquid Hydrogen has added specifications for the vacuuminsulation design of membrane systems. The International Maritime DangerousGoods (IMDG) Code has added 5 new UN entries, involving safety standards forthe transport of lithium metal batteries, which will be applied on a voluntarybasis in 2027 and become mandatory in 2028. These regulatory adjustments willdirectly affect the design direction of global new ships in the next threeyears.

In terms of regional markets, substantialprogress has been made in the consolidation of South Korea's shipbuildingindustry. The merger between HD Hyundai Heavy Industries and HD Hyundai MipoDockyard has been approved by South Korea's Fair Trade Commission. After themerger, the competitiveness in the environmental protection and militaryindustry sectors will be strengthened. The group also signed a green powersupply agreement with Korea Electric Power Corporation to advance the goal ofcarbon neutrality by 2050. Industry analysts believe that this merger willfurther concentrate South Korea's advantages in high-end fields such as LNGships and large container ships.

The global new shipbuilding market showsstructural differentiation. Greek shipowners continue to increase investment inChina's shipbuilding industry. Minerva Marine has added 2 more 1,800 TEU feedercontainer ships to its order at Yangzijiang Shipbuilding, bringing the totalnumber of orders in China to 8. The design of the 16,000 TEU electricpropulsion container ship developed by South Korea's HD Hyundai HeavyIndustries has obtained the Approval in Principle (AIP) from ABS. Adopting DCgrid technology, it improves energy efficiency by 20%, demonstrating rapidprogress in the field of green and intelligent technology.

Industry Trends: Green TransformationSpeeds Up, Technological Innovation Determines Future Discourse Power

The shipbuilding industry developments thisweek highlight that green transformation has become the core competitiveness ofthe industry. A series of progress, including the launching of China's firstalcohol-hydrogen electric dual-purpose distribution ship "Yuanchun001" in Jishui, the start of construction of the 99,000 cubic meter VLECby Jiangnan Shipyard, the entry into force of 4 VLCC orders at Hengli HeavyIndustry, and the 10-day reduction in the launching cycle of PCTC at ChinaMerchants Industry Weihai Shipyard, indicates that China's shipbuildingindustry is transitioning from "scale leadership" to "technologyleadership".

In terms of market prices, the new bulkcarrier price index remained unchanged at 169 points in August, while thetanker and container ship indices fell by 1 point to 212 points and 116 pointsrespectively. The new VLCC price remained stable at US$126 million, and theprice of post-Panamax container ships (22,000 TEU) decreased by US$1 millionmonth-on-month to US$270 million. Industry insiders pointed out that as thecost of green technology gradually decreases, price pressure on traditionalship types will become the norm.

CANSI predicts that global new ship ordersin 2025 will focus on green ships, and the proportion of alternativefuel-powered ships will exceed 30%. In this industry transformation, China'sshipbuilding industry, with 65.6% of global orders and continuous technologicalbreakthroughs, is moving from a "big manufacturing country" to an"innovation power". However, the technological counterattack fromSouth Korea after industry consolidation and the continuous adjustment of IMOregulations will make future competition more intense.

(Source: China Association of the NationalShipbuilding Industry (CANSI), Clarksons Research, International MaritimeOrganization (IMO), Xinde Marine News)