Recently, the China Shipbuilding Industry Association (hereinafter referred to as the Association) predicted that a new industrial cycle of the world's shipbuilding industry had begun. The Association believes that since the financial crisis, both the shipping and new shipbuilding markets have experienced more than 10 years of adjustment, with a time span of nearly half a full cycle. Today, a new round of rising cycle of shipbuilding market has quietly started.

Shipping market out of the quagmire

In the past 10 years, the major ship types have undergone the large-scale dismantling of 1 to 2 ships of transport capacity and the large-scale bankruptcy and reorganization of ship owners. The growth rate of the fleet has declined for seven consecutive years, and began to turn around in 2019. The sharp decline in the volume of sea transport in 2020 not only did not cause a huge impact on the shipping industry, but also led to a significant rebound in the global volume of sea transport and a significant increase in freight rates in 2021. The BDI index, which reflects the prosperity and decline of the shipping market, has broken through the pressure point of 3000 points for 10 years, indicating that the shipping market has come out of the quagmire of overcapacity.

At the stage of clearing the market capacity, the turnover of the new shipbuilding market in 2016 was only 30 million dwt; From 2017 to 2018, it will basically return to the normal level of 90 million dwt; Even in 2020, when the epidemic situation is the most serious and the market prospect is the most bleak, the volume of new ships will still reach 60 million dwt.

This shows that the new-building market has reached the bottom in 2016, and has suffered a temporary correction due to the epidemic situation in 2020. If there are no major adverse factors in the future, the annual turnover of new-building can remain above 90 million dwt.

The Association said that in recent years, the legislation of the International Maritime Organization on environmental protection has been gradually accelerated, and the relevant conventions on ballast water and sulfur emissions have entered into force. In the framework of the greenhouse gas emission reduction strategy, more new requirements such as EEXI and CII will be introduced in succession. EEXI and CII will be officially implemented in 2023, and the deadline for the installation of ballast water treatment system is September 2024. The old ships need to be equipped with various devices, but they choose to update because it is difficult to recover the investment; Middle-aged ships need to reduce the power and speed of the main engine, thus reducing the market capacity in disguised form; New shipbuilding is rapidly changing to alternative energy power. All these will accelerate the recovery of the new shipbuilding market and promote the further increase of the new ship turnover on the basis of 90 million dwt.

The adjustment of shipbuilding capacity is nearing the end

Since the financial crisis in 2008, affected by factors such as the sharp reduction of orders and the continuous decline of ship prices, there have been hundreds of cases of bankruptcy liquidation and merger and reorganization of shipbuilding enterprises worldwide. Among them, from 2012 to 2016, the capacity adjustment of the shipbuilding industry mainly focused on shutdown, bankruptcy and liquidation, and gradually spread from small and medium-sized enterprises to large shipbuilding enterprises; From 2016 to 2020, the adjustment of the shipbuilding industry turned to the merger and reorganization of large and medium-sized enterprises, including the acquisition of high-quality shipyard assets by advantageous enterprises and the merger and reorganization of large enterprise groups.

After the above two rounds of capacity adjustment, under the influence of the market, the number of active monohull shipyards with a record of receiving or delivering more than 10000 tons of ships in the world decreased from 440 to about 180 in 2016, and remained basically stable; Affected by the epidemic situation and market correction in 2020, the number of shipyards receiving orders or delivering ships dropped to about 150. In the past three years, although the operation of shipbuilding enterprises is still difficult, the economic operation of major shipbuilding enterprises in China, Japan and South Korea is generally stable, and the process of clearing capacity is basically over.

At present, the global shipbuilding capacity is stable at about 120 million dwt, with an average annual completion of about 90 million dwt and a capacity utilization rate of 75%, which is at the normal level of industrial development. According to this judgment, the current round of the world shipbuilding industry's capacity callback is basically coming to an end. In the future, the growth of demand for new shipbuilding and the rise of raw material prices will significantly drive the rise of new ship prices.

The growth trend of new energy ship types is obvious

In recent years, the development of biomass energy is conducive to the expansion of market space for LNG, methanol and other fuels. Europe and the United States have launched large-scale utilization of biomass energy. China has a large agricultural scale and a large population. The scale advantage of developing biomass energy, especially biogas fermentation, is more obvious.

The clean utilization of traditional fossil energy can support hydrogen, ammonia, LNG and methanol, all of which may become fuel types for large-scale application in the whole society.

At present, LNG, liquid ammonia and methanol are most likely to become the main fuel for ocean-going ships. As a marine fuel, LNG has been applied on a large scale and the supply chain system has been formed. In the later stage, the goal of zero emission can be achieved by installing marine carbon capture devices, or using synthetic natural gas and biological natural gas.

The marine main engine powered by liquid ammonia is currently under research and development, and due to the development of marine renewable energy, liquid ammonia, as a way of energy storage and transportation, has a generally promising application prospect in marine related industries.

The application of methanol does not require major changes to the marine internal combustion engine. If bio-methanol enters the field of transportation on a large scale (especially for heavy trucks), it can not only directly replace the traditional marine fuel oil, but also be used as the supplementary fuel for LNG powered ships and ammonia fuel ships to improve the flexibility of marine fuel.

Due to their disadvantages in energy density, hydrogen-powered ships and electric ships are more likely to achieve large-scale applications in inland ships, tugboats, small and medium-sized marine auxiliary ships, passenger ships and other fields in the near future.

Offshore equipment enters a new era of competition

Since 2014, the global offshore engineering equipment manufacturing industry has been severely impacted by shrinking demand and sky-high inventory, and a large number of enterprises have been stuck in the mire. However, it is gratifying that in the context of the new round of energy revolution, new tracks are looming and the industrial scale is expected to grow again.

The Association believes that in recent years, the investment in offshore oil and gas development is generally low, but there are still large-scale offshore oil and gas field development projects put into operation. In particular, the FPSO, FLNG, FS-RU and other equipment markets remain active, and the turnover in the first half of 2021 has reached nearly US $5 billion. At present, with the gradual recovery of economic activities in various countries, the international crude oil price has risen significantly, creating conditions for the restart of many offshore oil and gas development projects.

No matter what kind of marine resources are developed, no matter how the ocean is used, as long as marine development is involved, it cannot be separated from the support of marine engineering equipment. Now it is marine oil and gas resources and marine renewable energy. In the future, there may be more marine production and living infrastructure and more marine engineering equipment. The strategic position of the offshore engineering equipment manufacturing industry has not changed and will not change.

The launch of a new round of market cycle will help China's shipbuilding industry "stabilize the basic market", win time and favorable conditions for solving the deep-seated problems of industrial development, and create market space for planning long-term strategic objectives.

The transformation of product technology has opened up a new track for China's shipbuilding industry in the field of ship supporting equipment, and to a certain extent, it can bypass the long-term passive situation in the field of traditional ship supporting equipment.

The development of intelligent manufacturing technology is likely to weaken the important position of labor in the production factors and break the "curse of industrial transfer" caused by labor shortage and rising costs.

This is an important strategic opportunity period for China's shipbuilding industry to build a sustainable leading advantage, and the best time for China's shipbuilding industry to build a higher level of technological originality, industrial leadership and rule driving force. Relevant experts of the Association said that China's shipbuilding industry enterprises should set up the ambition to climb the peak again, be bold in development, be good at development, and not miss opportunities and fail to live up to the times. We should accelerate the construction of a green industrial system for the shipbuilding industry, accelerate the promotion of cross-industry collaboration and a new round of extension of the industrial chain, accelerate the promotion of higher level of foreign cooperation, and promote the healthy and sustainable development of the industry.