Orders received by Japanese shipbuilders last month for new vessels for exports fell by 60.1% on year to 493,540 gross tons (GT) in 16 vessels, according to the new data released by Japan Ship Exporters’ Association (JSEA) on December 14.
The on-year fall was not quite as steep as the 80.5% plunge seen in October, however, and represented a more-than-two-fold jump on October’s orders of just 217,470 GT, as Mysteel Global reported.
Among the vessels booked last month were eight Handymax carriers to a total of 285,600 GT, but the rest were mainly general cargo vessels, with one cement carrier and a chemicals carrier, the data showed, but no vessel demonstrating the building prowess of Japanese yards such as crude oil carriers or LNG tankers.
“But the January-November order total has now exceeded 10 million GT, which is not a bad result for this calendar year, so the shipbuilders must be kind of relieved,” an association official remarked. “On a fiscal year basis (to end-March next year), the total may fall below that level,” he admitted.
Total orders received between January and end-November reached 10.1 million GT in 240 vessels, lower by 30.4% on year.
Nevertheless, on a fiscal year basis between April and November, the total was only 167 vessels in 7.3 million GT in 167 ships, meaning the Japanese yards will need to win orders averaging 660,000 GT this month, and for each of the following three months to next March to reach that 10 million GT level – a tough target.
“Orders decreased on year because input materials costs such as ship plate remain high and the building firms have to transfer those rises to vessel prices,” the official said. “Of course, customers are opposing this, so concluding contracts is taking longer.”
The most recent data from Japan Iron & Steel Federation showed that the shipbuilding and marine structure sector bought 221,000 tonnes of steel in September, lower by 12% on year. The April-September total was 1.4 million tonnes, higher by 8.7% on year, however.
Meanwhile, on a customs clearance basis last month, the Japanese yards delivered 19 vessels, equivalent to a total of 779,790 GT, lower by just 7.3% on year – indicating that the yards have not scaled back the pace of construction to any large degree, despite the struggle for new orders.
One reason probably relates to the fact that Japanese shipbuilders’ order backlog will keep them busy for another two years, during which time they hope the global market for new vessels will improve, especially that for more fuel-efficient vessels where the Japanese have an edge.
As of end-November, their total export order backlog through until March 2027 was 20.4 million GT in 451 vessels, the data showed.
Written by Russ McCulloch, russ.mcculloch@mysteel.com
Note: This article has been written in accordance with an article exchange agreement between Mysteel Global and SteelMint.
Leave a Reply