US Sanctions on China-built Ships Would Be a Major “Headache” for the Maritime Industry

Almost half of the world’s trading dry bulk fleet was built in China, while an additional 66.4% of the orderbook is currently under construction in China. Additionally, more than 60% of the tanker fleet was also built in China, which would create a major issue when it comes to trade through the U.S. ports.

Source: Banchero Costa

In its latest weekly report, shipbroker Banchero Costa said that “the current USA government is no stranger to making proposals which send shockwaves through the shipping and commodities markets. The most recent one is to target with port fees of up to USD 1.5 million per port call for all Chinese built vessels and for any vessel of a company with newbuildings on order in China. To say that this would be disruptive to the shipping markets is a massive understatement”.

As a result, Banchero Costa attempted to see at what proportion of the fleet are vessels built or contracted at Chinese shipyards, for all the major vessel types. “For Dry Bulk vessels larger than 20,000 DWT, exactly 47.3% of the currently trading fleet was built in China. When it comes to the current orderbook, as much as 66.4% of dry bulk vessels over 20,000 DWT currently on order are contracted at Chinese shipyards. For Containerships larger than 1000 TEU, the share of trading units built at Chinese shipyards is 34.9%. As much as 68.5% of the current orderbook for Containerships larger than 1000 TEU is at Chinese shipyards”, the shipbroker said.

Source: Banchero Costa

Meanwhile, “for Crude Tankers larger than 60,000 DWT, 19.9% of the current trading fleet was built at Chinese shipyards. However, as much as 61.8% of the Crude Tanker currently on order are contracted at Chinese shipyards. For coated Product Tankers of over 30,000 DWT, 22.6% of the trading fleet is built in China. As of now, as much as 70.1% of the Product Tankers over 30,000 DWT currently on order are contracted at Chinese shipyards. For LPG Carriers larger than 1000 cu.m., the share of trading Chinabuilt units is just 15.5% of the fleet. However, 46.4% of the current orderbook for LPG Carriers larger than 1000 cu.m. is at Chinese shipyards. For LNG Carriers, 8.9% of the existing trading fleet was built in China. Again, however, as much as 28.4% of the current LNG Carrier orderbook is at China-based shipyards”, Banchero Costa concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide