Hyundai Samho Heavy Industries Co., the world’s fourth-largest shipbuilder affiliated with the largest shipbuilder Hyundai Heavy Industries Co., won a $180 million order from an Athens-based ship management company to build two very large crude carriers (VLCC). The order comes amid a drought of new orders in the overall shipbuilding industry.

According to multiple sources from the shipbuilding industry on Tuesday, Greek ship owner Almi Tankers S.A. has recently placed an order to Hyundai Samho Heavy Industries to build two 317,000-ton VLCCs. The shipbuilder is known to have received the order at a relatively higher price than the current market price that hovers between $86 million and $87 million per VLCC.

Still, the price is considered lower compared to what shipbuilders had received in the past. Even until late last year, Korean shipbuilders built VLCCs at about $95 million per unit, but with the protracted slump in the shipbuilding industry, the price of single VLCC has fallen to a record low level since 2004. In particular, the price of VLCC has halved in almost eight years from $162 million marked in September 2008. Last month, another Korean shipbuilder Daewoo Shipbuilding & Marine Engineering Co. also won an order from Singapore-based BW Group to build two VLCCs at the price between $89 million and $90 million per ship.

Industry observers forecast that the VLCC price will remain weak for a while as Chinese shipbuilders continue to dump vessels at a single price in the low $80 million range. According to global research firm Clarkson Research Services, the volume of global shipbuilding orders from January to July was 7.25 million compensated gross tonnage (CGT) - only one third of 22.82 million CGT during the same period last year. By country, Chinese shipbuilders accounted for 38.3 percent of the overall market with 2.77 million CGT, followed by Japanese shipbuilders with 13.6 percent (990,000 CGT), and Korean shipbuilders with 11.9 percent (860,000 CGT). The order backlog held by Korean shipbuilders reached 23.87 million CGT, marking the lowest in almost 13 years.

By Park Yong-beom

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