During 1997, while the newbuilding amount world wide recorded the third largest post-war tonnage at 36,000,000 GT thanks to such factors promoting ship-owner investments in new vessels, as the relatively smooth shipping market, the view that the ship prices were comparatively low, and the abundance of shipping finance, Japan's shipbuilding has also seen the largest order since the 1973 Oil Crisis and under a stable yen environment.
Meanwhile, the world economic situation is difficult to fathom. Despite the continuing expansion of the U.S. economy and the expected steady economic growth in the EU due to preparations for an integrated currency, growth problems continue to beset the economies in the Asian region and the confusion surrounding Japan's financial markets.
Under such circumstances, the future newbuilding market is expected, in the short term, to see a drop in demand due to large amount of orders received in recent years and an imbalance in the supply-demand situation, for mid- and long-term, as a result of expansion in capacity.
New Orders
In fiscal 1997, there was an increase in newbuilding orders received compared to those received in fiscal 1996. Specifically, 438 vessels or 13,463,000 GT were ordered, which reflected a 19.3% increase in the number of vessels and a 33.0% increase in GT. This increase, when classified by ship type, may be accounted for as follows：
In fiscal 1997, dry cargo vessels (consisting mainly of bulk and container carriers) accounted for 47.7% of total tonnage. For bulk carriers, there was an increase of 18.9% (up to 5,450,000 GT) in fiscal 1997 as compared to the previous year;however, container ships decreased by 47.7% (down to 1,023,000 GT) from the preceding year.
Of the total newbuilding orders for fiscal 1997, crude oil tankers accounted for 31.7%, or 4,265,000 GT, which reflected a 105.5% increase over fiscal 1996. Eighteen VLCCs or 2,796,000 GT were among the newbuilding tankers in fiscal 1997, as compared to ten or 1,619,000 GT in fiscal 1996. And for this fiscal year, orders for LPG and oil product carriers rose to 20 LPG vessels or 292,000 GT as compared to eight LPG vessels or 47,000 GT in fiscal 1996, and 14 oil product carriers or 448,000 GT as compared to previous year's eight carriers or 284,000 GT. Other chemical carriers rose to 42 vessels or 350,000 GT, a 7.7% increase in the number of vessels and a 16.7% increase in GT, while LNG carrier saw an increase in GT with one vessel of 20,000 GT compared to one vessel of 16,000 GT for the previous year.
When classified by domestic and export vessels, orders placed by domestic owners totaled 634,000 GT, which accounted for 4.7% of total newbuilding tonnage. This amounted to an increase of 178.1% above the previous year. Export vessels comprised 12,829,000 GT or 95.3% of total tonnage, which was a 29.7% increase over the previous year.
For purposes of comparison, worldwide newbuilding orders for calendar year 1997 totaled 36,480,000 GT, which was up 55.9% (as estimated by World Shipbuilding Statistics, Lloyd's Register of Shipping). By this estimate 15,362,000 GT, or a 42.1% share of worldwide orders reflected an increase of 67.7% in orders for Japanese shipyards compared to the 1996 level.
