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South Korea's Shipbuilding Resurgence: Capturing 20% of Global Orders Amid US-China Tensions

South Korea is poised to secure a 20% share of global shipbuilding orders this year, marking a significant recovery from its lowest point since 2016. This resurgence comes as China, the world's largest shipbuilder, sees a dramatic 47% decline in new orders, partly due to new US port fees targeting Chinese-built vessels. Korean giants like HD Korea Shipbuilding and Hanwha Ocean are exceeding their annual targets by focusing on high-value ships, including LNG carriers. Strategic collaborations with US naval shipbuilders, fueled by Washington's policies to curb Beijing's maritime influence, are providing Korea with a competitive edge in a shrinking global market.

Key Points: South Korea Gains 20% Global Ship Orders as China's Lead Weakens

  • Korea's market share rebounds to 22%
  • China's new orders plummet 47%
  • US port fees pressure Chinese shipbuilding
  • Korean firms exceed annual order targets
  • Focus on high-value LNG carriers and naval collaboration
3 min read

South Korea secures 20% of global ship orders as China's lead weakens

South Korea recaptures 20% of global shipbuilding orders in 2024, outperforming rivals as US policies pressure China and demand shifts to high-value vessels.

"The US... is likely to give Korea a strategic edge in gaining more share in the global shipbuilding market. - Industry Source"

Seoul, December 29

South Korea is on track to win back a 20 per cent share of the world's shipbuilding orders this year. This recovery comes as global demand for new ships declines and the United States takes steps to slow China's maritime power.

Korea accounted for a 22 per cent share of the global market from January to November, according to a report by The Korea Herald. Data from Clarkson Research shows that Korean shipbuilders received orders for 10.03 million compensated gross tonnage (CGT) during this period.

CGT (Compensated Gross Tonnage) in shipbuilding is a standardised unit used to measure a shipyard's workload and output, accounting for a ship's type and size.

Although Korea's total orders fell 5 per cent compared with last year, the country is outperforming its rivals. China is currently the biggest shipbuilder in the world, but its new orders fell by 47 per cent to 26.64 million CGT in the same period.

Last year, Korea's share was 17 per cent, its lowest since 2016. Experts now expect Korea to stay in the 20 per cent range for the whole year.

The global shipbuilding industry is seeing fewer orders overall. Total orders across the world fell by 37 per cent to 44.99 million CGT from January to November. Korea's performance is strong because the United States is putting pressure on China.

The US plans to charge a fee of about USD 50 per ton on ships built in China that enter U.S. ports. This makes it risky for shipowners to procure from China, making Korean builders a better choice.

Large Korean companies are already meeting their goals. HD Korea Shipbuilding & Offshore Engineering has secured USD 18.16 billion in orders for 129 ships so far. This exceeds its target of USD 18.05 billion.

Hanwha Ocean has secured USD 9.83 billion in orders, more than it received all of last year. Samsung Heavy Industries has reached 76 per cent of its USD 9.8 billion target by securing contracts for a range of tankers and carriers.

"Although Korean shipbuilders have witnessed a rise in revenues, primarily driven by orders for high-value ships such as LNG carriers, China still dominates the world's shipbuilding market on price-competitiveness," the report quoted an industry source.

"But the US Make American Shipbuilding Great Again or MASGA project, along with Washington's curbs on Beijing, is likely to give Korea a strategic edge in gaining more share in the global shipbuilding market."

US President Donald Trump recently showed support for working with Korean companies. He announced that Huntington Ingalls and Philly Shipyard would lead the building of new US Navy ships. Hanwha Ocean bought the Philly Shipyard.

HD Hyundai and Huntington Ingalls agreed in October to work together on new support ships for the US Navy. This is the first time Korea and the US have collaborated in this way.

- ANI

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Reader Comments

P
Priya S
The US pressure on China is clearly a major factor here. It shows how geopolitics directly impacts global trade and manufacturing. For India, this could be an opportunity to attract some of that diverted investment if we can improve our infrastructure and ease of doing business.
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Rohit P
Good for South Korea! They are smart to focus on specialized, high-tech ships like LNG carriers where they have an edge. China's 47% drop in new orders is huge though. Makes you wonder about the health of their overall manufacturing sector.
S
Sarah B
The strategic US-Korea collaboration mentioned at the end is key. It's not just about tariffs; it's about building long-term partnerships. This is where India needs to be more proactive with countries like Japan, South Korea, and the US in advanced manufacturing.
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Michael C
While it's positive for Korea, the overall global orders falling by 37% is concerning. It points to potential economic slowdown and reduced trade volumes worldwide. That's a bigger worry for all export-dependent economies, including India.
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Karthik V
A respectful criticism: The article focuses heavily on the US role, but doesn't delve deep into *why* Korean shipbuilders are more competitive on quality. What specific technologies or workforce skills give them the edge? That analysis would be more useful for readers here trying to understand industrial competitiveness.

We welcome thoughtful discussions from our readers. Please keep comments respectful and on-topic.

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