Big drop in Japanese newbuilding orders

Shipyards in Japan reported 69% fewer orders in January and forecast a third year of declines in 2009 as the global recession slashes demand for new vessels. According to the Japan Ship Exporters Association, orders were received for 193,700 cgt last month. The yards, including Mitsubishi Heavy Industries and Mitsui Engineering & Shipbuilding, had orders for 625,823 million tons a year earlier.

“The serious global economic recession has slowed marine transportation,” Masamoto Tazaki, chairman of the 20-member Shipbuilders’ Association of Japan, said at a press conference in Tokyo. “The industry will have to be ready for sluggish orders for new ships.” There have been no reports of vessel order cancellations at Japanese shipyards even as the number of contracts fall, he said.

Japanese yards will seek a drop in steel plate prices for contracts starting 1 April as demand for the metal falls from carmakers and machinery companies and prices decline for steelmaking commodities such as coking coal. Japanese steelmakers want a 67% cut in the annual contract price for coking coal because of a slump in global demand for the alloy, Macquarie Group Ltd. analysts said in a report yesterday.