Far Eastern yards keep expanding

Despite concerns over chronic overcapacity in the shipbuilding industry, two well-established Far Eastern yards are ramping up their production capacity with fresh investment.

South Korea’s Daewoo Shipbuilding & Marine Engineering has recently completed the world’s largest floating dock, which is set to boost output by eight ships a year. The facility is estimated to have cost around $130m.

Measuring 438 meters in length, 84 meters wide and with a depth of 23.5 meters, it will be able to handle VLCCs, ultra-large containerships and LNG carriers.

Productivity gains and the addition of the new dock will help it boost production to around 75 vessels annually.

With new ordering activity at a virtual standstill and owners seeking to cancel orders, the expansion now appears to be an unnecessary extravagance. However, Daewoo will need the facility to digest its current orderbook.

Governments meeting under the OECD shipbuilding working group are currently discussing how the ongoing expansion of capacity, mainly centered on China, can be constrained.

In a separate development, Japan’s Tsuneishi Shipbuilding is increasing production at its Chinese facility with the addition of two new goliath cranes. The two 700-ton cranes have been installed at Tsuneishi Zoushan and will significantly reduce dock time and man hours. They replace two old 200-ton jib cranes.

Tsuneishi Zoushan focuses on Handymax and Kamsarmax bulkers and currently has 41 ships on order amounting to 3m dwt.