Journalists have learned from the China Association of the National Shipbuilding Industry (CANSI) that according to statistics, China's demand for ship plate steel in 2008 will surpass 12 million tons, up 27.5% from a year earlier. In 2009, it is expected that demand will surpass 16 mln tons, up 33.3% YOY. This estimate is based on shipbuilding steel consumption in 2007 and orders now placed with domestic shipbuilders.

In 2007, ship companies consumed 9.41 mln tons of steel in total, mainly for shipbuilding and repairing, ship subsection manufacturing, and maritime engineering. The domestic shipbuilding industry consumed 7.11 mln tons of steel, of which 5.91 mln tons were plate steel, 680,000 tons were shaped steel, and 520,000 tons were of various other kinds. In 2006, total shipbuilding steel consumption was 5.66 mln tons. Plate steel, shaped steel and other types of steel accounted for 4.64 mln tons, 560,000 tons and 460,000 tons respectively. At present, Chinese companies hold shipbuilding contracts totaling 158.89 mln deadweight tons (DWT). As a result, it is estimated that in 2008, ships totaling 25 mln tons DWT will be completed, with 40 mln tons DWT to be completed in 2009. When ship repairing and renovation, ship subsections and maritime engineering are added, CANSI estimates that China will require more than 12 mln tons of steel for its shipping industry in 2008.

Moreover, CANSI has estimated that ship steel demand will top 18 mln tons in 2010. 85% of this ship steel will be consumed by builders in the Yangtze Delta, Bohai Rim and Pearl River Delta regions.

Source: Shanghai Securities News

Date: 27 May 2008

CN01/SW/MM