Owners Seek Prompt Deliveries

Friday, November 05, 2004
Sembcorp Marine, which is set to announce third quarter earnings, is best known as a ship repairer, conversion specialist and builder of oil rigs.

This week, however, the company announced that it has won a contract for two more 2,600 teu container ships from German owner Reederei F Laeisz at a contract price of US$42m each. The ships, which will be built at the group’s Jurong shipyard, are costing 33% more than similar units ordered by Taiwan’s Wan Hai Lines last year.

However, the German owner may yet demonstrate his astute timing, for the vessels are due for delivery in Mar and Sept 2006, ahead of the delivery dates available at most Far East mainstream shipbuilders. And there is a growing shortage of modern container tonnage in this range which will fulfil an vital role as mainhaul post-panamax vessels require broader and deeper feedering networks. Vessels in the 2-6000 teu range have seen their average earnings increase dramatically over the last two years. In 2002, they could have earned an average of $10-11,000 a day; last year they would have doubled that level; and in the last three months such ships have been making between $33-35,000/day.

As many of the world’s builders are now booking contracts for ships that will not deliver until 2008, shipyards that can offer delivery dates in 2006 are few and far between. And owners, keen on prompt tonnage, are increasingly on the look-out for such facilities. Only last week, Norway’s publicly listed chemical tanker operator Odfjell announced a contract with Russia’s little-known Sevmash yard at Severodvinsk near Archangel. The Russian builder will construct between eight and 12 IMO II chemical carriers for Odfjell, each of 45,000 dwt, at an average price of about $41m. The company still has five more of its eight 39,500 dwt vessels under construction at Poland’s Stocznia Szczecinska Nowa. Building at an average price of $58m, these ships will deliver between March 2005 and March 2007.

Good timing is vital in shipping and mixed signals on economic developments in China make good timing over the next four years more of a lottery than an informed judgement. There are still plenty of economic analysts warning that a sharp Chinese slowdown could send both the dry and liquid bulk markets into a headlong tailspin that would leave tomorrow’s newbuildings earning a pittance, today’s prices looking disastrously high, and the attraction of shipping as a possible investment definitely a no-no. In such an instance, a 2006 delivery could look distinctly unattractive, as compared with one two years later.

But then there are analysts like Deutsche Bank’s chief economist for Greater China, Jun Ma, who told delegates at the 4th International Dry Bulk Review conference in Hong Kong this week that the Chinese economy is likely to experience a “soft landing” in 2005, with GDP growth of 8.4%. Dry bulk rates might ease back, but would certainly not crash.

Others at the conference were more bullish, predicting an ongoing imbalance between demand and supply, healthy charter rates across the main sectors and a continuing role for China as a key driver behind the shipping markets. Moreover, there are still others who point to the rapid economic expansion in India, South America generally and Brazil in particular, as well as eastern Europe and Russia.

Meanwhile, European shipbuilders meeting in London this week were not certain of their future. On the one hand, Reinhard Lüken pointed out that orders received in European yards during the first half of this year exceeded those booked throughout the whole of 2003, a volume itself that was double the low bookings of 2002. Meanwhile Corrado Antonini, Fincantieri chairman, called on European yards to work together more closely, mentioning the Leadership 2015 shipbuilding initiative backed by the European Union. However, he also noted the threat posed by European marine technology companies heading off for China where they could operate more cheaply. Initiatives to co-operate in certain initiatives with Far Eastern shipbuilding interests should also be considered, he said.

Maritime Reporter April 2015 Digital Edition
FREE Maritime Reporter Subscription
Latest Maritime News    rss feeds

Shipbuilding

China Shipbuilders may Merge to Stay Afloat

The China's four state-run shipping-related companies  are reportedly in the initial phases of combining units in order to beef up the national shipbuilding industry, says local media.

Chevron Hires Norce Endeavour for Thailand Ops

Solstad Offshore ASA (SOFF) has fixed the 2011-built 18,000 dwt crane barge Norce Endeavour to Chevron for work in Thailand next year for around 200 days.   Solstad

Taiwan's Yang Ming Marine to Add Bigger Vessels to its Fleet

Yang Ming Marine Transport Corporation, Taiwnanese global shipping and logistics services company,  will take delivery of 14 large-sized ships over the next two years,

Navy

USN Names Littoral Combat Ship

Secretary of the Navy Ray Mabus announced today that the next Freedom-variant littoral combat ship (LCS) will be named USS St. Louis. The future USS St. Louis,

Chinese Submarine to Pakistan: Raising Nuclear Tensions in South Asia

Pakistan, a country plagued by economic and political insecurity, to conclude the deal of eight conventional submarines during Chinese President Xi Jinping's visit to Islamabad on Monday (April 20),

'Make in India’ - the Newbuzzword in Indian Shipping Sector

The Prime Minister Narendra Modi's  'Make in India’ initiative offers a plethora of opportunities in the maritime sector, particularly in shipbuilding, with the

 
 
Maritime Contracts Maritime Security Maritime Standards Naval Architecture Pipelines Pod Propulsion Salvage Ship Electronics Shipbuilding / Vessel Construction Sonar
rss | archive | history | articles | privacy | contributors | top maritime news | about us | copyright | maritime magazines
maritime security news | shipbuilding news | maritime industry | shipping news | maritime reporting | workboats news | ship design | maritime business

Time taken: 0.1578 sec (6 req/sec)