Major South Korean shipbuilders have met their shipping order targets for the year ahead of schedule, shifting their focus in the second half to profitability rather than volume. With several years' worth of work already secured, they plan to fill remaining dock space with high-value liquefied natural gas (LNG) carriers, eco-friendly vessels, and offshore plants.
According to the shipbuilding industry on August 9, Samsung Heavy Industries has achieved its shipping order target early this year. As of August 3, the company reported cumulative orders of 34 vessels worth $5.8 billion, reaching 102% of its annual target of $5.7 billion.
The orders include 14 LNG carriers, two ethane carriers, four gas carriers, two container ships, and 12 oil tankers, focusing on relatively profitable vessel types.
However, the overall annual target has not yet been met. Cumulative orders, including two floating LNG production facilities (FLNG), total $10.2 billion, which is 73% of the annual goal of $13.9 billion. As a result, there is a strong likelihood of focusing on large offshore projects in the second half.
HD Korea Shipbuilding & Marine Engineering's shipbuilding affiliates secured $16.38 billion in orders for the shipping sector in the first half of the year, achieving 96.2% of their annual target. HD Hyundai Heavy Industries has already surpassed its individual annual order target.
In the first half, HD Korea Shipbuilding secured orders for 38 very large gas carriers (VLGC), 17 LNG carriers, and one floating LNG storage and regasification unit. Additionally, they have sufficient work secured in tankers, container ships, and car carriers, with over 500 vessels in backlog, representing about 3.5 years of work.
Hanwha Ocean has been slower in securing new orders compared to HD Korea Shipbuilding and Samsung Heavy Industries but continues its selective order strategy. As of the end of June, Hanwha Ocean reported 24 new orders worth $3.8 billion, with a total backlog of 153 vessels valued at $33.77 billion.
Notably, Hanwha Ocean expanded its orders in the first half, focusing on VLCCs. A significant portion of LNG slots has also been filled. During a conference call last month, Hanwha Ocean stated, "Due to last year's order expansion, our delivery slots are effectively exhausted until 2028, and we are currently negotiating with customers for deliveries in 2029 and 2030," adding, "We are also pursuing sales for slots in the first half of 2031."
Hanwha Ocean considers not only commercial vessels but also special ships as a key part of its orders. The company is targeting the U.S. Navy shipbuilding projects in collaboration with the Philadelphia shipyard and is building a portfolio that includes both commercial and special vessels. In the commercial sector, it aims to secure profitability through high-value vessels like LNG carriers and VLCCs while adding long-term work in special vessels.
A shipbuilding industry official commented, "The results show that domestic shipbuilders are expanding their order portfolios centered on high-value vessels, and we expect profitability improvements to continue without issues."
* This article has been translated by AI.
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