While shipbuilding industries are confronted with lack of works, orders contracted in 2012 declined by 45% year-on-year to 45.5m dwt, to make matters worse, a decline by 10% year-on-year seen in newbuilding prices, which troubles shipyards with profitability and cash flow.
Clarkson Newbuilding Price Index dropped by 9.2% year-on-year to 126.3p at the end of December in 2012 which was the largest drop ever since 2009 when the index fell 22.3%.
The index fell as much as 32% for the last five years since the end of 2007 when it peaked at 185.1p.
However, the index rose just very slightly at the end of December compared to 125.9p on the previous month.
Recording 127.2p at the end of October in 2012, the newbuilding price index ended its protracted downturn for 15 consecutive months and gained its first rally.
Meanwhile, although it experienced another drop at the end of November, the index was on the upswing after a month which brought expectations that the newbuilding price has finally bottomed out.
Many shipbuilding and shipping industry specialists assumes that the newbuiding price has bottomed out. They also expect that the shipbuilders do not have capacity to lower the price any more, while the material prices and labor cost would increase this year.
Furthermore, newbuilding price is expected to rise with the drop in exchange rate for the dollar, from stronger Korean won and Chinese yuan.  
While newbuilding prices seem to hit the bottom repeating the rise and fall in recent three months, the prices are predicted to show the very gradual upturn since the sharp recovery of newbuilding demand is hard to see.