Newbuilding deliveries will be 16% lower than originally expected this year due to coronavirus disruption, Clarksons Research has said.
The company's latest report shows the Covid-19 pandemic continues to have a range of impacts on the shipbuilding industry.
"While output from Chinese yards has returned to normalised levels, the extent of shipyards’ ability to catch-up lost production remains uncertain," Clarksons analyst George Warner said.
"Shipyard deliveries are likely to be impacted across all of the major builder countries in 2020 by travel disruption, equipment shortages and financial stress on owners."
The research division of shipbroking giant Clarksons is projecting newbuilding handovers to hit 76m dwt this year, about 16% down on its original forecasts.
Investors not as hungry
Only 226 vessels have been reported ordered to the end of May, down 58% year-on-year, with the Covid-19 pandemic severely impacting investor appetite, Warner added.
The orderbook now stands at 2,898 vessels of 170m dwt, down 19% from this time last year.
"With recycling markets beginning to reopen, and amid deteriorating freight market conditions, total recycling in full year 2020 is now projected to reach circa 33m dwt," Warner said.
Output falling globally
At the end of May, deliveries from South Korean were down by 20% year-on-year to 196 vessels totalling 3.4m compensated gross tonnage (cgt). At Japanese yards, deliveries fell 23% to 170 vessels totalling 3m cgt.
In China, output was down by 24% to 179 ships of 3.8m cgt.
However, after lockdowns in February and March, by April Chinese production was back to normal levels, with 48 ships of 1m cgt handed over.
Meanwhile, output from European yards was down 49% to 28 vessels of 600,000 cgt at the end of March.
This was driven in part by temporary closures at prominent cruiseship builders, Clarksons Research said.
"With total volumes down 34% year-on-year, ordering at Chinese yards has been supported to a degree by domestic ‘statement’ ordering," Warner said.
"Whilst yards will no doubt be marketing hard, investor appetite is likely to remain under significant pressure. Builder activity trends will warrant close tracking through the rest of 2020."
Clarksons has already cast doubt on how many of the remaining 700 scrubber installations will go ahead worldwide, following pandemic delays and the narrowing spread between the cost of low sulphur and high sulphur fuels.
