South Korean shipyards exited the business of making cranes a decade ago because of stiff compeitition from Chinese makers.
The Busan Port Authority is considering ordering container gantry cranes from South Korean shipyards, which have a paucity of orders for new vessels, South Korea’s Yonhap News Agency reported.
South Korean shipyards used to build cranes, but stopped in 2006 “amid the influx of cheap Chinese products,” Yonhap said.
A Busan Port Authority official reportedly said that Chinese cranes were over 30 percent cheaper than South Korean products more than a decade ago, but the price difference has narrowed down to less than five percent recently.
An executive with Chinese crane manufacturer Shanghai Zhenhua Heavy Industry Co., Ltd. told the Port Strategy magazine in 2014 that his company held a 70 percent market share for ship-to-shore cranes, and a 50 percent market share for rubber-tire gantry cranes.
The Busan Port Authority is building seven container berths, while three other berths are being constructed at the port by private companies, Yonhap reported.
Korean shipyards, like many around the world, are starved for work. According to an article posted on Clarksons’ Shipping Intelligence Network earlier this month, after a period of extremely low ordering in 2016, “forward cover” has shortened to 2.3 years, having declined throughout 2016, as the orderbook shrank by 25 percent globally.
Forward cover is calculated by dividing the total orderbook by the last year’s output, and by using compensated gross tonnage, a measure that not only considers the
size of a ship, but the complexity of building the particular type of
ship. For example, a containership is more complicated to build than a
simple bulk carrier.
Clarksons said that looking around the shipbuilding world, yards in Korea currently have the lowest level of cover at 1.5 years, and only 11 shipyards took an order in Korea last year.
Busan Port weighs container crane order from South Korean shipyards
