According to the data of BIMCO, the Covid-19 pandemic, which influenced the whole world, caused delays or cancellations of contracts in the shipbuilding industry and postponement of new building deliveries.
The economic decline caused by coronavirus restrictions caused investment in shipbuilding to fall to its lowest level in 11 years in the first quarter. Due to the steady increase in the corana virus outbreak, the large contraction in both supply and demand is expected to have a serious impact on the potential for new construction in 2020.
Covid 19 Effects on Asia shipbuilding industry
Falling orders affect all types of vessels, from container ships carrying the world's manufactured goods to high-margin natural gas carriers, where South Korean and Chinese shipyards have fixed their growth prospects this year. According to the marine data provider VesselsValue, the trade jump directly hit Korean and Chinese shipyards, which controlled about half the global shipbuilding capacity.
According to Clarkson's data, 100 ships of all types were ordered for $ 5.5 billion in the first three months of 2020, down 71% from the first quarter of last year and the lowest total since the second quarter of 2009. Chinese shipyards received 55 orders in the first quarter and South Korean shipyards received 13 orders, representing 50% and 81% drops respectively.
Demand for bulk carriers is decreasing as less raw materials are required due to cessation of production at Chinese factories. In addition, although energy traders make reservations to tankers to store oil, orders for tankers are also decreasing.
Covid 19 Effects on Europe shipbuilding industry
The European Shipbuilding industry is facing a major crisis linked to the Covid-19 outbreak.
In the short term, shipbuilding is expected to suffer from shipyards closing, supply shortages and delays in orders and deliveries. Therefore, European shipyards and marine equipment manufacturers have called on the European Union to protect the European Union from the impact of the coronavirus pandemic.
SEA Europe urged the commission to offer sectoral policies and financial support tailored to the specific needs of the European shipyards and marine equipment industry to alleviate the serious consequences of the COVID-19 outbreak and ensure the industry survival.