Marine Log

January 8, 2007

Top three Korean yards set $36 billion order target

Korea's top three shipbuilders have set a target of $36 billion in sales this year, down from last year's record $37.4 billion, as orders are expected to decline and contract prices fall, the Korean Overseas Information Service quotes industry sources as saying today.

Hyundai Heavy Industries expects $13 billion worth of orders for ships, engines and other products this year, compared with $14.1 billion last year.

"We topped last year's target by $3 billion," said a company official. "That means we have a lot of order backlogs... we set a more or less conservative business target."

Daewoo Shipbuilding and Marine Engineering has set a target of $11 billion in orders this year, unchanged from last year's figure. The company has a backlog of around $22 billion.

Samsung Heavy Industries has lowered this yea's target to $11 billion, compared with last year's $12.3 billion.

Korean yards took almost half of the world's $100 billion ship orders last year, swelling their backlogs and enabling them to charge peak prices.

But they are faced with increased prices for steel plate and the rising Korean won, reducing the value of dollar-denominated contracts.