Cash-rich Evergreen Marine Corp is said to be joining the growing crush of liner companies seeking to order dual-fuel methanol propulsion vessels for its next haul of container ship newbuildings.
The Asian liner giant, which does not operate any dual-fuelled ships or have any dual-fuelled newbuildings under construction, has asked shipyards in China, Japan and South Korea for offers on a slew of methanol-powered neo-panamax newbuildings.
Several shipbuilding players said Evergreen had launched a tender for 24 container ships of 16,000 teu. The cost of the deal was not disclosed but shipbuilding sources put a price tag of about $175m on each vessel, or $4bn in total.
“This is the first time that Evergreen is looking to order dual-fuel ships,” said a newbuilding broker. “It will probably be asked to pay $175m or more per ship.”
TradeWinds contacted Evergreen for confirmation of the tender but an official declined to comment, saying it does not discuss commercial matters.
Shipbuilding players following the container ship market said South Korea’s Hyundai Heavy Industries, Samsung Heavy Industries and Daewoo Shipbuilding & Marine Engineering have been asked by Evergreen to participate.
Japan’s Imabari Shipbuilding, China’s Jiangnan Shipyard, Hudong-Zhonghua Shipbuilding, Dalian Shipbuilding Industries Co (DSIC), Yangzijiang Shipbuilding and Taiwanese shipbuilder CSBC Corp are believed also to be in the frame for the business.
And sources said the deal will likely have to be split between yards due to the dearth of available berths in the market.
“We wonder which shipyard has the 24 slots to offer Evergreen,” asked a shipbuilding broker. “Most of these big shipyards are sitting on huge order backlogs … we think Evergreen is likely to split the newbuilding order between a few shipyards.”
Available 2026 slots
Shipbuilding pundits think shipbuilding companies under the control of China State Shipbuilding Corp (CSSC) stand a good chance of getting the deal as they could join forces to bid for the project.
“Jiangnan, Hudong-Zhonghua and DSIC are all under CSSC and the state-owned shipbuilding group also owns engine maker China Marine Diesel and WinGD,” said a broker. “They still have some 2026 slots to offer.”
Shipbuilding sources said Evergreen’s tender is still in its early stages and it will need several months to go through shipyard bids and review the technical specifications for the newbuildings.
Sources said the tender has been well received by shipyards but has been less well received by some market watchers who questioned the rationale for the tender.
What’s the rationale?
One shipping player that follows the container ship market asked if it was necessary for Evergreen to order so many new vessels when it already has almost 50 ships under construction.
“Its plan to order another 24 newbuildings is questionable,” he said. “We are facing the largest orderbook in the history of shipping in terms of teu capacity with an excess of 30% of the current existing fleet.
“I am fully aware we have environmental regulations ahead of us and shipping has to be more green going forward but it should still make commercial sense and teu demand is clearly not indicating that we do need all this new capacity.
“It is also questionable whether there will be enough alternative fuels available — particularly for methanol, which seems to be piling on interest. It is likely that the vast majority of these latest [newbuilding] orders will run on conventional fuel at least for the start of their trading life.
“It is unbelievable that lines keep ordering now — maybe some of them simply made too much money that they do not know what to do with it anymore after buying newspapers, aeroplanes, hospitals and logistic companies.”
