Chinese shipbuilding industry cannot be optimistic, having new order plummeted by 50.3%.
According to China.cnr.cn, China Shipbuilding Industry Corporation (CSIC)'s vice president said that plunged import of iron ore, core, etc., and increasing number of idle ships have caused decrease in shipowners' newbuilding investment.
The vice president said Chinese shipyards' overall newbuilding order during the first half of this year plummeted by 50.3% amid global economic difficulties and Eurozone crisis.
Also, traditional shipping finance specialized banks in Europe have tightened their finance in the segment, which resulted in newbuilding investment.
In a report from the Minisry of Commerce of China, during July of 2012, new order decreased in China, while Korea saw more orders, as China focused on sales of low-value commercial ships, especially bulkers.
He said that Chinese shipbuilders, which face difficulties in being placed orders for high-value vessels, are comparatively more unfavorable, many of small-and-medium shipyards are prospected to fall behind from the market.
The vice president said most of small-to-medium sized shipyards in China just started shipbuilding business during the flourishing period and takes 50% of overall Chinese shipyards. He questioned about CSIC's acquisition of those yards.
While there is no new order or no demand for newbuildings, the acquisition of these yards by China's large state-owned shipyards would be of no help. He said that CSIC, at present, has no plan for M&A.
Lastly, he added that Chinese shipbuilding industry would be stuck with depression over the next three-to-four years.