China Shipyard orders plunge 96%

NEW orders for Chinese shipyards dropped 96 percent in the first five months, the Ministry of Industry and Information Technology said today. The value of total industrial output by domestic shipyards reached 203.3 billion yuan (US$30.0 billion) in the first five months, up 38.8 percent year-on-year, according to a statement on the Minister's Website. The growth rate was down 18.7 percentage points from the year-earlier period, the statement said.
New ship orders in the first five months were 1.18 million deadweight tons down - 96 percent - from the same period last year.
New orders in May stood at 190,000 DWT and total orders held by Chinese shipbuilders were 192.2 million DWT by the end of May, down 6 percent from the beginning of the year.
The export value of domestic shipyards rose 25.8 percent to 96.8 billion yuan from January to May in 2009.
Ships completed by domestic shipbuilders over the period reached 12.2 million DWT, up 61 percent from the same period last year.
The Ministry of Industry and Information and Information and Technology announced a detailed plan to boost the shipbuilding industry in early June. It will ban the building of new shipyards for the next three years and will also encourage qualified shipbuilders to list their shares and issue bonds.
"The price for new ships may continue to drop before the end of the year and dismantling old vessels can help the revival of the industry," Zhu Rujing, a consultant at China Shipbuilding Industry Research Center, was quoted by Shanghai Securities News as saying.