HD KSOE close to intaking 4.8 trillion won worth order from CMA CGM
HD Korea Shipbuilding & Offshore Engineering (KSOE) is reportedly close to inking a massive container shipbuilding contract worth at least $3.5 billion. If the contract is wrapped up, HD KSOE will have met its annual order target in just six months, marking the fourth consecutive year that the company has achieved its order target early, according to Businesskorea.
According to industry sources, HD KSOE recently signed a letter of intent (LOI) with French shipbuilder CMA CGM to build 20 container ships. The total contract value is reportedly worth at least $3.5 billion.
HD KSOE has received orders for a total of 112 vessels (including one offshore unit) worth $12.1 billion (about 16.83 trillion won) in the past 10 days. This is 89.7 percent of the company's annual order target of $13.5 billion. Even if the Korean shipbuilding giant wins the minimum volume of this contract, it will enable the shipbuilder to exceed its annual order intake target.
The 112 vessels include eight liquefied natural gas (LNG) carriers, 48 petrochemical carriers (PCs), 36 liquefied petroleum gas (LPG) and ammonia carriers, one ethane carrier, two liquefied carbon dioxide carriers, six very large crude carriers (VLCCs), three tankers, two pure car and truck carriers (PCTCs), one floating storage and regasification unit (FSRU), one offshore unit and four specialty vessels.
The contract is particularly noteworthy because it is for container ships which shipbuilders have not received many orders for. In the container ship market, orders have been on the wane since 2023 after a slew of orders in 2021 and 2022 following the outbreak of the COVID-19 virus.
But the recent Red Sea incident has led to a rebound in orders as ships have taken longer routes instead of passing the Red Sea and freight rates and second-hand ship prices have rebounded, analysts say.
HD KSOE is expecting additional orders down the road. In addition to CMA-CGM, other shipping companies such as Germany's Hapag-Lloyd, Israel's ZIM, Switzerland's MSC, and Denmark's Maersk are promoting new ship purchases.
