Korean ships sell at fuel-saving premium
Time：2014-12-22
Browse：105
In a research note, Hana Daetoo Securities analysts Park Moo-hyun and RA Yoo Jae-seon reported a 16.7% premium for two recent South Korean-built vessels amid a challenging market for shipbuilders.
“The two 156,000dwt Suezmax tankers that South Korean shipbuilder Daewoo Shipbuilding & Marine Engineering [DSME] clinched last week were priced at $70M each,” said Park and Yoo.
“The $70M is higher by 16.7% than the price of a 160,000dwt tanker which will be built by China’s shipyard New Times Shipbuilding.”
DSME received the order for two tankers from Angolan national oil company Sonangol, according to IHS Maritime’s Sea-web data.
New Times Shipbuilding was contracted in October by Bermuda-based Frontline 2012 for four 160,000dwt Suezmax tankers plus four options.
“According to shipbrokers, the newbuilding price index has dropped 1% within the past two months,” said Park and Yoo. “However, the price of DSME vessels is going up.”
In their analysis, greater fuel efficiency is a main factor boosting the price of DSME ships.
“As poor fuel efficiency leads to a fall in value of ships, shipowners are keenly sensitive to fuel efficiency,” they said.
“The widening gap between the two countries can also be found in the payment method. For Korean shipbuilders, the percentage of the advance payment is increasing while Chinese players are struggling with the heavy-tail payment, which allows shipowners to pay 70% of total amount of the contract upon the delivery.”