South Korea would see more orders in the second half this year than the first half. In 2011, $38bn were contracted in H1 and $12.8bn in H2, typically more orders in H1. However, prospected orders for H1 and H2 this year are $20.6bn and $28.2bn each.
Analyst Kim Hyun of Shinhan Investment Corporation forecast that prices of second-hand vessels would stabilize and likely to increase, as major three shipping indexes - BDI, CCFI and WS - are expected to rebound after March.
Firming second-hand pricing will be helpful to owners' improvement of liquidity, which will lead to cause market recovery and increase newbuilding orderings, in the long term.
In case of freight rate, it has been standing at the lowest level in the last 10 years, however, it is possibly to rise in the second half.
According to Kim, in case of containership sector, owners aim to control tonnage and rise rate through alliance, which resulted in increasing CCFI (China Containerized Freight Index).
In case of tanker, product carrier and chemical tanker is expected to recover faster than VLCC. Also, bulkers are in uptrend, with increasing BDI. Therefore, it is less likely that market would go bad again.
Meanwhile, Kim said 2011's LNG carrier, drillship and offshore plant boom will be shrink a little this year. With delayed Final Investment Decision (FID) for Nigerian Brass project and Russian Shtokman project, LNG market is concerned to be daunted, while Korean Big3 contract just optional drillships.
In 2012, 40 LNG carriers and 25 drillships are to be ordered, which are lower than last year's 52 LNGCs and 38 drillships new deals. But prospected offshore plant orders this year are estimated to be overall $14bn, which would be similar to last year.
Kim forecast, "As there will be some orderings for LNG carrier and offshore plant and major shipping indexes will turn around this second half, after showing lowest performance in the third quarter, it will resume to make a steady growth till earnings recovered in 2014."
Kim also stated that ship financing market will be recovered and LNG-carrier ordering will resume after the second half this year, Big3 will achieve average order of $14bn in 2012, of which LNG carrier and offshore facility accounted for 82%.