China’s Shipbuilding Business Is Bulging
Reporter: China’s domestic shipbuilding industry realized a combined profit of nearly 850 million US dollars in the first six months of this year, a 150 percent increase year-on-year.
Nie Lijuan is Vice Secretary General of the China Association of National Shipbuilding Industry.
“In the first half of this year, new ship orders hit a record of more than 42 million deadweight tons, and existing orders exceeded 100 million for the first time.”
China has become the world’s No. 3 shipbuilder, after Japan and South Korea. Its shipbuilding industry accounts for 20 percent of the global market.
Yao Weifu, manager of the Shanghai Shipping Exchange’s information division, says the shipbuilding boom is fueled primarily by soaring global demand.
“Orders mainly come from the companies engaged in the international bulk dry-cargo business.”
According to Yao, shipping demand in the international bulk dry-cargo market has risen by over five percent this year, while capacity has only grown three percent.
Poor capacity has resulted in a continuous rise in shipping charges, and shipping companies have hence earned a lot.
“The growth of the world economy is the main engine to drive the shipping market, which will surely boost prosperity in the shipbuilding sector.”
China’s leading ship maker, COSCO Shipping, will build four 27,000 deadweight ton multi-purpose ships worth over 120 million US dollars.
China Shipping Development also plans to build four crude oil tankers worth 460 million dollars.
The heat has been conducted to the iron and steel industry, as the demand for steel plates keeps rising.
Chen Qixiang is deputy general manager of the Jinan Iron and Steel Group.
“We’ve rolled 850,000 tons of ship plates in the first eight months of the year - an increase of nearly 300,000 tons, or more than 50 percent, compared with the whole year of 2006.”
While shipbuilding is expected to continue the upbeat momentum in the next few years, the Chinese government is currently taking measures to further standardize the industry.
The Commission of Science Technology and Industry for National Defense has said the country will implement a shipbuilding license system to encourage Chinese shipyards to adopt advanced equipment and technologies, as well as modern management methods.
The commission has published the draft of the Shipbuilding License Management Law, seeking public comment.
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