China Leads Newbuild Orders Despite Threats of Port Fees and Slowing Market

The threats of tariffs, port fees from the U.S. on Chinese-built ships, and a slowing overall market for newbuilds have yet to chip away at China’s leadership in shipbuilding. The latest data from Clarkson Research points to China’s continued dominance while South Korea and others look for new strategies to take advantage of the uncertainties in the market.

Shipbuilding orders overall are off dramatically in the first five months of 2025 compared to the record pace of 2024. Clarkson’s data shows that total orders were down by more than half (55 percent) with analysts commenting that it is the first sign of uncertainty, the issues in global trade, and falling freight rates. This is despite a record pace for containership orders which are at an all-time high with the total capacity on order up nearly 50 percent from a year ago.

Chinese shipbuilders continued to lead the orders in the first five months of the year with Clarkson calculating they booked 7.86 million compensated gross tons or nearly half the orders compared to 3.1 CGT for South Korea which represented 24 percent of the global market. Total orders worldwide were calculated at 15.92 million CGT.

While the U.S. released the details of its plan for port fees in mid-April, orders continued a similar pattern in May. China booked 39 percent of global orders (640,000 CGT) or a total of 42 ships. South Korea booked just 15 percent of the orders in May or 250,000 CGT for eight ships while in a market anomaly, France rivaled China with nearly a third of the orders, or 546,000 CGT, driven by MSC Cruises' large cruise ship order.

Korea’s shipbuilders however are working to make inroads and according to the media reports are planning to expand their aggressive bidding for containership orders. Last year, China held nearly 87 of the containership construction market share but the Koreans are highlighting their expertise in high-value shipbuilding such as methanol-fueled ships, LNG, and future technologies. The Korean media points to reports that Ocean Network Express (ONE) and Hapag-Lloyd are meeting with Korean shipbuilders, but Tradewinds reported that MSC Mediterranean Shipping Company told Nor-Shipping last week that the U.S.’s port fees would not be a barrier to orders in China.

The South Koreans also point to the fact that their CGT per vessel was nearly double China’s in May. They point to this as evidence that they are winning orders for more complex and larger ships. South Korea has traditionally dominated the high-value segment for LNG and other gas carriers and looks to use this also with containerships going forward.

Construction slots are booked three or more years ahead at some of the large shipyards, especially in South Korea, which some speculate might also be a reason the Korean yards are lagging behind their Chinese competitors. However, as global ordering has slowed, the backlog is starting to thin. South Korea currently has 22 percent of the total global orderbook, 36.3 million CGT versus China’s 96.4 million CGT backlog which equals 59 percent of the global order total.

The U.S. trade representative continues to push forward with the plan to launch port fees later this year on Chinese-built ships. Last week, it released revisions for the fees planned for all vehicle carriers arriving in the U.S., but so far, the threat of the fees seems to have done little to drive orders away from Chinese shipbuilders.