In Yangzi Mitsui Shipbuilding Co., Ltd., Taicang Port Economic and Technological Development Zone, Jiangsu Province, a number of ships are under intense and orderly construction. Since January this year, Yangzi Mitsui Shipbuilding Co., Ltd. has stabilized orders and maintained growth, and strived to sprint to the "opening of the door" in the new year. Ji Haixin (People's Vision)
The picture shows the 85,000-ton bulk carrier "SDTR FAITH" built by Shan shipbuilding heavy industries under China State Shipbuilding Group for AVIC Leasing. The ship was successfully delivered recently. Courtesy of the Big Ship Group
The three major shipbuilding indicators achieved comprehensive growth, the market share remained the world's leading, and 6 companies entered the top 10 of the world's shipbuilding completions, new orders and handheld orders - the latest data shows that China's shipbuilding industry will achieve full prosperity in 2021.
The shipbuilding industry has a high degree of internationalization, long industrial chain, intensive technology and wide radiation coverage, and is one of the first major equipment industries in China to enter the market of developed countries. What are the factors for China's shipbuilding industry to achieve such a good result in 2021? Can we continue the boom in 2022?
Multi-vessel delivery to achieve a "good start"
——In 2021, the three major shipbuilding indicators will achieve comprehensive growth, and China will continue to "sit firmly" as the world's largest shipbuilding country
"Sign a new order in the new year, and in 2022, the operation will usher in the 'opening red'!" The relevant person in charge of the Large Ship Group under the China State Shipbuilding Group told reporters that before the Spring Festival, the Big Ship Group signed six double-fuel 16,000 TEU container ship construction contracts with a well-known European shipowner, and signed four 37,000-ton Great Lakes bulk carrier construction contracts with polish shipowner PZM, signing two new shipbuilding orders in one fell swoop.
"In 2021, in the face of the complex international situation, especially the serious impact of the new crown pneumonia epidemic, Dachuan Group coordinated the prevention and control of the epidemic and scientific research and production, seized market opportunities, expanded marketing means, and established models such as cloud negotiation, cloud contracting, and cloud delivery, and the production and operation work showed a good trend of multi-point blossoming and going hand in hand." Yang Zhizhong, secretary of the party committee and chairman of the board of directors of the big ship group, said.
Looking back at 2021, the development of China's shipbuilding industry can be described as booming——
The three major shipbuilding indicators achieved comprehensive growth, and the market share remained the global leader. According to data released by the China Shipbuilding Industry Association, in 2021, the national shipbuilding completed 39.7 million dwt, an increase of 3.0% year-on-year; undertook new ship orders of 67.07 million dwt, an increase of 131.8%; at the end of December, 95.84 million dwt of handheld ships, an increase of 34.8%. Shipbuilding completions, new orders, and handheld orders accounted for 47.2%, 53.8% and 47.6% of the world total in terms of deadweight tons, respectively, an increase of 4.1, 5.0 and 2.9 percentage points compared with 2020.
The revenue and profit of enterprises have increased synchronously, and the international competitiveness of backbone enterprises has been enhanced. From January to November 2021, there were 1,093 shipbuilding industry enterprises above designated size in the country, achieving a main business income of 425.22 billion yuan, an increase of 9.6% year-on-year; and a total profit of 7.35 billion yuan, an increase of 56.4% year-on-year. For the first time, the three major shipbuilding indicators of China State Shipbuilding Corporation ranked first among the world's shipbuilding enterprise groups.
"In 2021, in the face of complex and severe situations such as the continuous evolution of the global epidemic and the sharp rise in raw material prices, the whole industry will unite and forge ahead to jointly promote the rapid growth of China's shipbuilding industry in the opening year of the '14th Five-Year Plan', and the status of the world's largest shipbuilding country will be further consolidated, which has injected a strong impetus into forging ahead into a new era and accelerating the construction of a shipbuilding power." Li Yanqing, secretary general of the China Shipbuilding Industry Association, said.
At the beginning of the new year, a number of shipbuilding companies have signed contracts or delivered new ships, continuing the booming momentum of 2021 - on January 25, Zhoushan COSCO SHIPPING Received Orders for Two 63,600-Ton Bulk Carriers; On January 20, Yangzhou COSCO SHIPPING Heavy Industries delivered the second 210,000 DWT bulk carrier "Shandong Endeavour" built by ICBC Leasing and Shandong Shipping; recently, CIMC Raffles delivered the Y-Type semi-submersible yacht carrier "Yacht Servant" built by CIMC Raffles for the Netherlands Sitford Shipping Company. "In 2022, the mainland shipbuilding industry will continue to maintain its growth trend." Li Yanqing is optimistic about the shipbuilding market this year.
Why did it become a "frontrunner" in the industry?
——The overall prosperity of the global shipbuilding market and the effectiveness of structural adjustment have obviously led to the rapid development of China's shipbuilding industry
At present, China's shipbuilding industry has developed to be able to design and build all kinds of modern ships that meet the specifications of any classification society in the world, meet international common technical standards and safety requirements, and are seaworthy in any navigation area in the world.
From being a "runner" in the industry to a stable "leader", why can China's shipbuilding industry achieve such good results?
Look at the global market background - in the past year, the tightness of global shipping capacity has driven shipping prices to rise sharply, high demand and high freight rates have prompted shipowners to increase new ship orders, and the overall prosperity of the global ship market has led to the rapid development of China's shipbuilding industry.
Li Yanqing analyzed that the world economy is gradually warming up under the normalization of the epidemic, promoting the "explosive" growth of the global shipping market, involving most of the main transport ship types such as containers, bulk cargo, and natural gas, effectively supporting the recovery of the new shipbuilding market. "In addition, the newbuilding price and the proportion of handheld orders in the fleet at the intersection of 2020 and 2021 are at a historic low, creating favorable conditions for shipowners to place orders and shipyards, and both shipowners and shipyards have a more positive attitude towards transactions." Li Yanqing said.
Looking at environmental changes - Li Yanqing introduced that the active efforts of the International Maritime Organization in promoting ship energy efficiency and shipping carbon reduction, the implementation date of the third phase of the EEDI amendment to ship types including container ships, gas carriers, ordinary cargo ships, etc. has been advanced from 2025 to 2022, as well as measures such as CII indicators for fleet carbon intensity and ship carbon emission ratings, which have also become the driving force of good market expectations.
Looking at the domestic shipbuilding industry itself - actively adjusting the structural transformation has become a strong driving force to promote the "going out" of Chinese ships. In 2021, Chinese shipbuilding enterprises will continue to maintain a leading position in advantageous ship types, undertaking bulk carriers and container ships accounting for 76.4% and 60.9% of the total global new ship orders respectively throughout the year; continue to adhere to the high-end ship type subdivision market, undertaking chemical ship, automobile transport ship, offshore auxiliary ship and multi-purpose ship orders according to the load tonnage of each accounted for more than 50% of the global total, of the world's 18 major ship types classification, China has 10 kinds of new orders ranked first in the world.
In addition, Chinese shipbuilding enterprises have launched a variety of green ship types that meet the international environmental protection requirements of the new stage, which conforms to the global trend of green and low-carbon transformation.
Li Yanqing introduced that in 2021, 23,000 TEU dual-fuel container ships, 5,000 cubic meters of dual-fuel full-pressure LPG carriers, and inland liquefied natural gas (LNG) power bulk carriers were successfully delivered to shipowners; 210,000 tons of LNG-powered bulk carriers, 7,000 vehicles of dual-fuel vehicle carriers, methanol-powered dual-fuel MR tankers and other orders were undertaken in batches, and green powered ships accounted for about 24.4% of China's new ship orders according to load tonnage..." In the past year, The mainland has made remarkable achievements in green and low-carbon innovation. Li Yanqing said that from the marine main engine to the LNG fuel storage tank, from the cryogenic maintenance system to the design of the whole ship structure, as well as the promotion of large-scale dual-fuel powered ship types, Chinese shipbuilding companies have quickly caught up with the forefront of international shipping needs, effectively responding to the concerns of the International Maritime Organization and the global maritime industry on carbon emissions.
Maintain steady growth with confidence
——Ensuring ship delivery, efficiency and safety will be the key tasks of the industry in 2022
Will the boom in the marine market continue in 2022? Can China's shipbuilding industry maintain a good momentum of development?
"This year, there is no suspense in the stable development of Chinese shipyards. Overall, we have good expectations for steady growth. Li Yanqing analyzed that from a macro point of view, China's shipbuilding enterprises still maintain a balanced development trend. The three mainstream ship types in the past, as well as the rapid development of gas ships, passenger ships (passenger ro-ro ships, cruise ships), automobile transport ships, special engineering ships and other orders, have been fully received in China's large and medium-sized shipyards, compared with the shipping companies of related countries, there is no obvious weakness in this regard. "From a microscopic point of view, Chinese shipbuilding enterprises have made good progress in production management and operation organization in recent years, greatly improved in construction efficiency and quality, and objectively added points to competitiveness."
"What really boosts China's shipyards' is China's positive and effective response since the outbreak of the epidemic and its strong control of the industrial supply chain." Li Yanqing said, "In 2022, the supply chain recovery will continue, and every 'blowout' of demand in the ship market will make the shipowner's investment with an urgent and short-term return trend." In this market environment, seeking investment safety and fast delivery is the first choice for shipowners, and the Chinese shipping market has become one of the preferred choices. ”
Last year's booming shipbuilding market was exciting, but the industry still has challenges such as high raw material prices and limited profitability. In this regard, Guo Dacheng, director of the China Shipbuilding Association, suggested that on the one hand, shipbuilding enterprises should make full use of financial instruments such as futures to avoid risks or mitigate risk impacts, and on the other hand, they should strengthen cooperation with raw material suppliers. Recently, China State Shipbuilding Group signed a strategic cooperation agreement with Angang Group to strengthen cooperation in building a high-quality and efficient supply chain system, researching and developing new materials and new products, etc., promoting the deep integration and development of shipbuilding enterprises and raw material enterprises, and achieving mutual benefit and win-win results.
The China Association of Shipbuilding Industry suggested that ensuring ship delivery, efficiency and safety should become the current key tasks. In 2021, with the substantial growth of new ship orders, the production task of enterprises is full, and the production guarantee coefficient of Chinese shipbuilding enterprises (handheld order volume / average completion volume in the past three years) is about 2.55 years, and 2022-2023 will be the peak year of centralized delivery. Shipbuilding enterprises should strictly implement the normalization prevention and control measures of the epidemic, make procurement planning for steel and supporting products as soon as possible, and avoid delays in raw materials and equipment affecting ship delivery.
With the introduction of the "14th Five-Year Plan" outline and relevant special plans of relevant state departments and local governments, the development direction and focus of the shipbuilding and marine engineering equipment industry have been further clarified. Li Yanqing said that the industry association will strengthen the study and judgment of the trend of market demand, pay close attention to the development of upstream and downstream industries such as trade, shipping, steel and so on, and increase efforts to study the impact of exchange rates, interest rates, taxes and fees on the shipping industry, so as to provide support for enterprise production and operation, healthy development of the industry and policy decisions.
"Powerful assembly shipbuilding enterprises and assembly supporting enterprises must have the courage and responsibility to become the 'chain chief' of the modern industrial chain, build around the assembly, promote the gathering of resources, cultivate a number of industrial clusters, and form a number of industrial chains." Guo Dacheng said that the integration and strengthening of the industrial chain cannot be achieved overnight, and it is necessary to have the perseverance of "dripping water through stones" to become a real shipbuilding power.