Global shipbuilding boom continues as number of owners ordering narrows 

A Clarksons Research report shows shipowner appetite for newbuilds remains healthy against the backdrop of strong shipping markets, competition for yard slots amid increasing lead times, and a focus on fleet renewal among some owners. 

However, analysis of the data "shows that investment in newbuilds is much more concentrated, and in particular that ordering of alternative fuel ships is especially consolidated with a smaller number of owners leading investment," Clarksons Research analyst Trevor Crowe said.

Container ships accounted for 250 vessels ordered between January-September, something Clarksons believes is supported by the rush for greener tonnage. 84% of box ship capacity ordered this year is alternative fuel capable. Other brokers have reported that more than 1M TEU of container vessels was ordered in June alone, representing more than 3% of the global fleet. Chinese yards account for about 90% of orders in TEU terms.

Data from Hartland Shipping Services showed on a three-month moving average basis, the market for newbuild container ships returned to its highest level since Q2 2021, the peak of the last newbuilding upsurge.

Clarksons Research recently flagged the global container ship fleet surpassed 30M TEU in capacity for the first time, even as the demand for new ships shows no signs of slowing up. Riviera understands German liner giant Hapag-Lloyd is in negotiations with various shipyards to build up to 24 new ships, with deliveries expected towards the end of the decade.

Bulker contracting has also picked up, despite the segment being down 14% on the 2023 rate, with COSCO’s gigantic 42-ship order worth US$2Bn doing much of the heavy lifting for the segment so far this year. 

Tanker uptick

Crude and product tanker contracting remains well above trend too, with Clarksons logging about 16.8M dwt of product tanker orders. Before the recent uptick in container vessel orders, tankers - particularly those carrying products - dominated newbuilding activity with LR2 and MR tankers leading the surge.

While the crude tanker sector lags slightly, its orderbook is also expanding, with the current ratio surpassing 10%. The orderbook for Suezmax tankers represents 17% of the fleet, according to Clarksons.

The ongoing fuel transition has been credited as a driver. Over 50% of gross tonnage ordered in January-September is alternative fuel capable. LNG-capable tonneage has increased notably, despite the methanol-capable segment easing slightly. Excluding LNG carriers, 30% of tonnage ordered between January-September will be LNG capable while 9% will be methanol capable. The corresponding figures for 2023 were 15% for LNG and 13% for methanol. 

A long(er) term boom?

Prices also continue to increase, with Clarksons’ guideline index up 7% since the start of the year, due to strong ordering volumes, firm ’forward cover’ and inflationary pressures at yards continuing to support firm pricing. Newbuild investment value totalled US$155.2Bn in January-September, supported by high newbuild prices, firm cross-sector newbuild demand and spending on green technologies. Clarksons said in nominal terms, newbuild investment is “on track for one of the strongest years on record, behind only the peak period of the 2000s shipping market boom.” 

With shipyard capacity expanding, deliveries are only projected to rise in coming years.