China overtakes Japan

For the first time China has overtaken Japan to rank the second in terms of vessel order book tonnage with a record $5.49 billion new orders during the first half of the year. This represents an increase of 61% over the same period last year and, according to London-based Clarkson, China has a 28% share of the world market.

China’s shipbuilding industry achieved an output value of $13.4 billion in the first six months, a rise of 48% over the same period last year, according to statistics issued by the management office for shipbuilding industry under the Commission of Science Technology and Industry for National Defence (CSTIND). The aggregate profits reaped by shipbuilders more than doubled to reach $842.1 million, Xinhua news agency reported.

Ship production has been increasing by more than 40% annually in recent years, as its low labour cost kept attracting more orders, analysts said. Export orders to 128 countries take up 83% of the ship output in China with Singapore, Germany and Hong Kong as its major markets. The orders at Chinese yards are also increasing because domestic shipping companies are expanding and upgrading their fleets to meet the county?s increasing demand for crude oil and raw materials for manufacturing consumer goods for the world market. The country now has to import about 47% of its crude oil, but 85% of this oil is transported by foreign shipping companies.

The State Council, China?s highest law-making body, last year passed a mid-to long-term development plan that sets a target for the industry to capture at least 25% of the world?s ship output by 2010. If its goals were met, China would become the world?s largest manufacturer of bulk carriers and the second largest builder of oil tankers by 2010.

In the process, two Chinese yards ? Dalian Shipbuilding Industry and Shanghai Waigaoqiao Shipbuilding ? joined the ranks of the world?s top 10 shipyards, a list that used to be the sole domain of Japanese and South Korean shipbuilders.