The volume of LNG (liquefied natural gas) ship orders in China, which had decreased last year, shows an improved trend this year. With the largest Chinese private shipyards preparing to register LNG ship orders, competition in this area is expected to intensify significantly. The prevailing opinion is that a clear technological gap with South Korea still exists, but there are also voices suggesting that Korea must proactively enhance its competitiveness in next-generation ships.
Market Analysis and LNG Ship Market Share
According to published reports, as of September 22, the total global LNG ship orders from the beginning of this year until September 18 have reached 66 ships. Of this number, South Korea leads with 40 ships, accounting for 61.2% of the total, while China has secured 26 ships, representing 38.8% of the market share. China's market share had decreased from 42.8% in 2024 to 8.1% last year, but this year shows signs of improvement.
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Intense Competition and Technological Challenges
Analyses also indicate that China's efforts in the LNG ship sector are intensifying. For example, Hengli Heavy Industry, which previously recorded the largest volume of orders at a single yard, is expanding its order portfolio in the fields of tankers, cargo ships, and container ships, with its first new order for an LNG ship expected soon. In this context, the number of Chinese yards capable of building large LNG ships will increase from 5 to 6.
Given the boom in China's shipbuilding industry this year and the rising demand for large oil tankers due to concerns about the closure of the Strait of Hormuz, a high volume of orders has been attracted. In the first half of this year, the new order volume in China's shipbuilding industry reached 121,060,000 DWT (deadweight tons), accounting for over 80% of the global total. Hengli is also significantly increasing its order volume, having gathered over 200 ships in the first half of the year.
However, the industry's outlook is that it will be difficult for Chinese shipbuilders to replace Korean shipbuilders in the LNG ship market for some time. LNG ships are designed to carry cryogenic cargo at temperatures around minus 163 degrees Celsius and require a high level of technological skills. Additionally, the trust of shipowners, which stems from long-term construction experiences and actual practical records, cannot be secured in a short time.
Nevertheless, the domestic shipbuilding industry's landscape indicates that one cannot simply be optimistic about China's efforts. Based on the high volume of orders, China is expanding the production capacity of its yards and rapidly accumulating construction experiences. In particular, with the increasing number of yards that have received construction licenses for LNG tanks from GTT France, the technological gap that South Korea dominates will soon diminish.
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