Wall Street Journal challenges Korean shipbuilding industry optimism

Wall Street Journal analysts have challenged the optimistic view held by some Korean industry sources predicting that the worst is over for the Korean shipbuilding sector.

According to the Journal, some sources in Korea have forecast that orders would start coming in at a normal level from the second half of 2010.

The paper said that in 2009,  “global shipbuilders continued at full throttle, banging out and welding hundreds of vessels ordered from 2005 to 2007, the biggest years for ship orders ever. However, global shipbuilding orders… as of November 2009 totalled 6.5 million CGT for 2009, far below the 42.6 million CGT ordered in 2008.”

The report predicted that shipbuilding activity would start declining in 2010 and would “slide sharply” in 2011 and 2012.

“It typically takes two or three years to build a ship from design to completion,” the Wall Street Journal reported. “Korean shipbuilders received only a small number of orders in 2009 and with no rebound in sight in 2010, the following two to three years will be difficult for the industry."
 

Source: Baird Maritime