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20 ships for $7.8 billion! Two Chinese shipping companies to receive large orders for Duffy container ships

20 ships for $7.8 billion! Two Chinese shipping companies to receive large orders for Duffy container ships

Column:Industry News    Date:2021/3/20 14:37:41    Viewed:

The container ship shipping market is hot and the pace of shipbuilding by the shipping giants will not stop. This time the shipping giant Duffy Shipping will invest $1.2 billion (about RMB 7.8 billion) in two Chinese shipping companies to order up to 20 5,500 TEU container ships.

According to Trade Winds, Duffy Shipping has signed a deal with Yangtze River Shipping Group and Qingdao North Shipbuilding Heavy Industries for 5+5 5,500 TEU Panamax containerships, codenamed "Project Slade". The new vessels, which will be equipped with approximately 800 reefer sockets, are expected to cost more than US$60 million each and are expected to be delivered in 2023.

The new vessels will be conventionally powered, rather than LNG-powered, like the mega-containerships it has previously ordered. Industry sources say that such Panamax container ships are not the right size for the installation of expensive LNG bunkers and that the ship's engines will be costly and not economical.

If this order is finalised, it will be the first time that North Shipbuilding Heavy Industries has built a container ship. North Shipbuilding Heavy Industry has been building bulk carriers and ore carriers, Clarkson's data show that North Shipbuilding Heavy Industry is currently holding orders for a total of 22 4.575 million dwt, including five 325,000 dwt very large ore carriers (VLOC) and 14 bulk carriers.

This order is the icing on the cake for Yangtze River Shipping Group, which has already completed its annual order intake target. Yangtze River Shipping is undoubtedly the biggest winner in this year's container ship construction market. According to the international ship network understanding, since the beginning of the year Yangtze River Shipping Group received a total of 44 container ship orders, the vast majority of which are below 5,000 TEU feeder type container ships, in addition to four 11,800 TEU, 10 15,000 TEU and four 24,000 TEU large container ships. The total number of orders received was 371,340,000 TEU, or approximately 1,656,000 CGT, equivalent to 42.7% of all global container ship orders (97 vessels of 3,878,000 CGT).

According to Alphaliner, Duffy's fleet currently operates 554 container vessels with a total capacity of 2,991,446,000 TEU, representing a market share of approximately 12.3% and ranking fourth in the world in terms of capacity. In addition, Duffy has 24 vessels on order, with a total of 377,136,000 TEU. If added to the orders on hand, Duffy's capacity will exceed that of COSCO Shipping Group, which currently ranks third, regaining the third position in the world.

Earlier, Duffy Shipping announced its 2020 results, with improved profitability in all performance segments. Operating revenue reached US$31.45 billion, up 3.9% year-on-year. Earnings before interest, taxes, depreciation and amortisation (EBITDA) reached USD 6,109 million, a significant increase of 62.5% year-on-year. Thanks to strong international trade, Duffy ships managed to turn a net profit of USD 1,755 million in 2020, compared to a loss of USD 229 million in 2019.

According to Duffy Shipping's results report, its maritime segment reported operating revenues of US$24.23 billion for 2020, up 4% year-on-year. EBITDA was US$5.5 billion, up a significant 71.1% year-on-year, and net profit of US$1.86 billion. Duffy said the growth in the ocean freight business was mainly due to higher freight rates, with its average revenue per TEU at US$1,154, up 6.8% year-on-year.

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