What is the development status of shipbuilding industry?

I. Overview of shipbuilding industry

Shipping is the most important carrier of global trade. According to the statistics of the United Nations Association for the Promotion of Trade and Development, the volume of maritime trade accounts for 90% of the total global trade. As the upstream equipment of shipping, ships can generally be divided into two categories: military ships and civilian ships. Civilian vessels are usually further divided into ocean engineering vessels and transport vessels according to their uses, among which transport vessels occupy the main position. In terms of deadweight tonnage, the total deadweight tonnage of the three ship types of dry bulk carriers, oil tankers and container ships belonging to the same transport vessels accounts for nearly 90%, which is known as the three major ship types in the world. In terms of technical content, the construction materials and processes of offshore engineering vessels and liquefied gas vessels (LNG vessels, etc.) are more complex, and they are ships with higher added value.

Second, the development background of shipbuilding industry

1. Policy level

From the policy point of view, the new environmental protection regulations have accelerated the renewal process of old ships. Shipping companies currently account for 2.5 percent of global carbon emissions and are under increasing pressure to reduce air and Marine pollution. The International Maritime Organization (IMO) has proposed a carbon reduction action plan for the shipping industry, aiming to reduce carbon emissions by 50% by 2050, and two short-term measures - the existing Ship Energy Efficiency Index (EEXI) and carbon Intensity Index (CII) - will take effect in 2023. Of the existing fleet, only 21.7 percent of vessels are compliant with EEXI, with bulk carriers having the lowest compliance rate at 10 percent, followed by container ships at 25.6 percent and oil tankers at 30 percent.

2. Economic level

From the economic point of view, 2000-2011 is the global ship delivery upward cycle, the compound growth rate of completion is 13%. From the current age distribution of the fleet, the age of 16-20 years accounted for 16.5%, and the age of more than 20 years accounted for 7.1%, the aging trend of ships is obvious, the number to be dismantled gradually increased, and the demand for new ship capacity supplement gradually increased.

Third, shipbuilding industry chain

The ship manufacturing industry is the middle reaches of the ship industry chain, its upstream is the raw materials required for the production of ships, such as steel, paint, etc., and its downstream is the shipping industry that undertakes maritime transport trade. The global economy and trade directly affect the prosperity of the shipping industry, and fundamentally determine the prosperity cycle of the shipping industry.

4. Status quo of shipbuilding industry

1. Shipbuilding index

From the perspective of shipbuilding indicators, the three major shipbuilding indicators are shipbuilding completion, new orders and hand-held orders. According to statistics, from January to July 2022, the world's shipbuilding completed 47 million DWT, new orders 50.36 million DWT, and hand-held orders 215.4 million DWT; Among them, the market share of China's three major indicators is the highest, reaching 44.4%, 51.1% and 48.1% respectively.

2. Completed ship product type

From the perspective of global completed ship products, according to the statistics of the China Shipbuilding Industry Association, among the global completed ship products from January to July 2022, the number of bulk carriers is the most distributed, accounting for 56.8%, followed by oil tankers, accounting for 22.1%.

3. Number of operating shipyards worldwide

From the perspective of the number of active shipyards in the world, relevant data show that the number of global operating shipyards fell from 678 in 2007 to 341 in 2015, with a compound annual growth rate of -8.23%, and then continued to decline to 274 in 2021, and the compound growth rate from 2015 to 2021 was -3.58%, slowing down. It indicates that the capacity reduction cycle has entered the end, and the global shipbuilding capacity has contracted.

4. The number of shipbuilding enterprises in China

From the point of view of the number of enterprises, according to statistics, the number of China's shipbuilding enterprises peaked at 818 in 2010, in the process of passive capacity reduction, the number of enterprises dropped to 618 in 2015, the industrial clearing accelerated during the supply-side reform, and the number of China's shipbuilding enterprises dropped to 376 in 2020, a decrease of 44% compared with the highest value in 2010. Compared with a decrease of 6% in the previous year, the speed of production capacity clearance tends to flatten out, and the production capacity clearance is nearing the end.

5. Competition pattern of shipbuilding industry

1. Industry concentration

From the perspective of the global market, relevant data show that in 2021, the world's top ten shipbuilding groups accounted for 77% of hand-held orders, and the industry concentration is high. In addition, the orders of the top three shipbuilding groups in China, South Korea and Japan accounted for 66%, 92% and 71% of their own hand-held orders, respectively, and the internal industrial concentration of the three major shipbuilding countries has also increased to a higher level.

2. Market competition pattern of China's major shipping enterprises

Specifically looking at the Chinese market, from the group level, China's shipbuilding industry is mainly occupied by four shipbuilding groups, namely China State Shipbuilding Group, COSCO Shipping Heavy Industry, Jiangsu Yangzijiang Shipbuilding Group Co., Ltd. and Jiangsu New Era Shipbuilding Co., LTD., with a market share of more than 75% of the country's total. From the perspective of shipbuilding enterprises, the completion volume of China's top ten shipbuilding enterprises in 2020 will account for 73% of the total shipbuilding completion volume of the country, of which 5 shipping enterprises are subordinate companies of China State Shipbuilding Group.

6. Development trend of shipbuilding industry

90% of global trade is carried by sea, which is the most special and important part of the global transport system. Over the past decade or so, carbon emissions from shipping have shown a clear upward trend. According to the International Maritime Organization (IMO), global shipping accounted for 2.4% of global CO2 emissions in 2021. Under the requirement of carbon neutrality, the international shipping industry is facing increasing pressure on environmental protection, which will bring more demand for replacement in the medium and long term. Future carbon neutral ship types include liquefied natural gas (LNG), LPG and lithium, ammonia and hydrogen powered ships. Analysis of the status quo and development trend of global and Chinese shipbuilding industry in 2022, carbon neutrality brings ship replacement demand.