Home Shipbuilding Clarksons predicts 40 million CGT output for 2024-2025 following a record-breaking year for car carriers
By: Jasmina Ovcina Mandra January 15, 2024
With the maritime industry poised for strong growth, Clarksons Shipbroking expects a substantial increase in global shipbuilding activities, driven by the growth in South Korean output. Clarksons’ estimations project a significant 40 million compensated gross tonnage (CGT) output for the consecutive years of 2024 and 2025.
Illustration; Image credit.Yangzijiang Shipbuilding
The global shipyard output experienced a 10% year-on-year rise, reaching 35 million CGT in 2023. China emerged as a powerhouse in the shipbuilding arena, contributing 50% of the total output by CGT for the first time, eclipsing South Korea at 26% and Japan at 14%.
This achievement was underpinned by China’s lead market positions in bulkers (62% output compared to Japan’s 33%), tankers (41% versus South Korea’s 39%), and the latest addition, containerships (61% against South Korea’s 29%).
However, South Korea maintained dominance in LNG, commanding an impressive 83% compared to China’s 17%. The historical context reveals that South Korea’s output share peaked at approximately 35% in 2016, while Japan, in the 1970s and 1980s, occasionally hovered around the 50% mark. Interestingly, the United Kingdom consistently held an output share over 50% between 1900-50, underscoring the dynamic shifts in global shipbuilding over the decades.
Chinese yards also dominated ordering, with 60% of orders by CGT, while the global orderbook backlog only increased marginally across 2023 (by 4% in CGT) to remain at historically low levels (12% of fleet capacity).
Forward yard cover ended the year at a strong 3.5 years with yard pricing increased by 10% across the year. Exchange rates and steel costs were helpful to Asian yards at times but labour cost pressures remained a challenge.
Clarksons’ data for ship repair yards showed China as the market leader followed by Turkey and Singapore, with a modest uptick in scrubber retrofits and increasing energy saving technology (EST) retrofits.
According to Clarksons, there was generally a good flow of orders in 2023, down in CGT and value, up in DWT and GT, with an increase in tanker orders, +222% by dwt, albeit from a low base, and 12% increase by dwt for bulkers. Although containership ordering fell by 43% in TEU, this still represents historically high volumes, supported by liner companies continuing to invest in green fleet renewal programs, with 83% of capacity ordered being alternatively fuelled.
2023 was a record year for car carrier orders, with 80 orders of $8.1bn, 79% alternative fuelled, rising to 98% including “ready” orders. There were also good order volumes for gas with 68 orders for very large gas carriers (VLGCs) and 66 LNG carriers.
There were also some good volumes with innovative alternative fuel/ESTs in the smaller ship market, such as in the short sea /MPP, offshore wind, and ferry sectors. With the cruise market recovering,