by Lloyd's List
11 April 2025 (Lloyd's List) - NEWBUILDING orders dropped considerably in the first quarter as volatile freight markets, long shipyard lead times and uncertainties around US tariffs and port fees have delayed investments in new tonnage.
Data tracked by Lloyd’s List shows that 219 ocean-going merchant vessels were ordered in the first three months of 2025. This is almost half the 410 ships contracted in the same period of last year.
Xclusiv Shipbrokers analyst Dimitris Roumeliotis said that newbuilding investment surged to a multiyear high in 2024 to reach $215.3bn, the highest level seen since 2007. However, activity has slowed considerably since the beginning of this year.
“Near-term sentiment faces uncertainties, including the US Trade Representative’s proposed port fees for Chinese-linked ships, macroeconomic pressures and the still-evolving landscape of alternative fuel solutions,” Roumeliotis told Lloyd’s List.
“Over the longer run, however, these factors are anticipated to spur significant fleet renewal, especially as owners balance environmental mandates with technological shifts in propulsion and energy efficiency,” added Roumeliotis, who notes that underlying drivers, such as the need for alternative fuel capable vessels and the ageing global fleet, continue to support new ordering activity.
Most sectors recorded declines in orders in the first quarter, with the bulk carrier sector experiencing the biggest fall.
According to Lloyd’s List data, only 18 bulk carriers were contracted in the first three months of 2025, with 12 being supramax units. The remaining bulker orders in the first quarter were provided by a total of six capesize bulkers.
Reflecting the downturn in ordering activity, during the first quarter of last year a total of 128 bulk carriers were ordered.
Conversely, the containership sector continued to order new tonnage in the first quarter of 2025 with 65 vessels contracted, compared to 21 in 1Q24.
New contracts were focused on the largest boxship segments and included 11 liquefied natural gas dual-fuel, 24,000 teu vessels ordered by Taiwan’s Evergreen, with the order being divided between a Chinese and a South Korean shipyard.
CMA CGM and MSC both added to their considerable orderbooks in the first quarter of 2025, with orders for 18,000 teu and 21,700 teu boxships, respectively.
Despite an orderbook representing almost 30% of the capacity of the existing fleet in service several more orders are due to be placed in the near future.
These include eight 2,800 teu and six 1,800 teu feeder boxships set to be contracted by Greek tonnage provider Capital Ship Management. The order is expected to be won by South Korea’s HD Hyundai Mipo, which Capital has a long relationship with for the construction of product tankers.
Other boxship orders in the pipeline include eight 4,300 ships for non-operating owner Chartworld. The order is expected to be placed in China.
Xclusiv Shipbrokers’ Roumeliotis noted while Chinese shipyards remained at the forefront of output, and delivered over half of global tonnage in 2024, orders in China took a sharp downturn in recent weeks.
This may be attributed to shipowners awaiting more clarification on the outcome of the USTR levy, which will penalise those owners with vessels on order in China, before they make investment decisions.
“The overall slowdown may reflect broader caution in the market amid changing regulatory frameworks and macroeconomic headwinds,” said Roumeliotis.
“It will be critical to watch subsequent quarters to see if this lull persists or if fresh demand materialises once shipping stakeholders recalibrate in the face of evolving conditions.”
Despite a slight dip in newbuilding prices since the start of 2025, newbuilding pricing remains at near historically firm levels due to a mix of solid forward orderbooks and the ongoing fuel transition in shipping.
Nevertheless, should ordering activity remain subdued throughout 2025, shipyards could be tempted to start reducing prices to win new business despite rising input costs for shipyards, in particular from higher wages.
Meanwhile, more shipbuilding capacity is due to come on stream this year from formerly dormant Chinese shipyards, which could provide a further downward impact on newbuilding prices as the yards seek to fill their newbuilding slots.
