Home > Report > Korea Report

 
 
 
   
  Korea Report - July 2017.
  Author : Hwang & Co     Date : 17-08-04 16:20     Hit : 21842    
   Korea Report - July 2017.pdf (469.9K), Down : 10, 2017-08-04 16:20:01



HWANG & COMPANY, LTD.


T : +82-31-783-6130/1 

F : +82-31-783-6132 

hwangnco@hwangnco.com   

www.hwangnco.com



Korea Report - July, 2017.


The Moon administration and ruling party, taking advantage of their high-running popularity, is rolling out one populist policy after another. Moons first appearances was related to his election pledge to turn all contingent workers at public enterprises and entities into regular workers. Then he made the announcement of weaning the nation from nuclear power. Moon administration also raised the legal hourly minimum wage for next year by the largest-ever margin to elevate it to KW10,000 ($8.90) by 2020. On top of these, an immense debt write-off program, which may benefit as many as 400,000 people, is also in the making. All these policy programs are costly and have many ramifications. Moon administration is pushing them in a unilateral manner with no public consensus or proper debate. The administration can be very much identified as populism and unilateralism.


Korean shipbuilders have seen sudden rush of orders on the bottom prices of ships.

The HHI Group has won a total of 73 new vessels through June and the major part of it was tankers. HHI, in the first half, took orders for 17 vessels, $1.65 bil, of which 13 vessels are tankers and 4 are gas carriers. HSHI recorded 15 vessels with $1.02 bil, all of which are tankers. HMD won 41 vessels with $1.49 bil, 33 of which are PCs, 4 Ro-Ro ships, and 4 $11.4 bil at the end of May. HSHI recorded 62 vessels orderbook in $5.6 bil at the end of May. HMD backlog reaches 108 vessels in about $4.5 bil at the end of June.

SHI lead the way in terms of value with their two mega offshore production facilities. In the period, SHI won 13 vessels in total (8 oil tankers, 2 LNG carriers, one LNG FSRU, one FLNG, one FPU) with $4.8 bil, and recorded total orderbook of 81 vessels worth $24 bil at the end of May.

DSME recorded 7 vessel orders with $770 mil, two of which are LNG carriers, and 5 VLCCs. At the end of May, DSMEs orderbook reached 102 vessels with $31.9 bil. DSME is expecting more firm orders are coming in this month as it signed LOIs with Excelerate Energy and HMM for LNG-FSRU and VLCC series respectively.

Hanjin HIC won orders for 9 special purpose vessels (naval sector) in Yeongdo Shipyard, which is worth about KW350 bil. For Subic Shipyard, it secured 4 VLCCs and 2 Aframax tankers. According to Clarksons, Hanjin HICs 2 shipyards have a total of 26 vessels in their combined orderbook at the end of May.

Daesun won orders for 8 vessels through June, two of which are options. One of them is 3.5K stainless steel oil/chemical tanker for Japanese owner, and another one is 6.5K handysize oil/chemical for Korean owner. 2+2 vessels of 1,000 teu containerships for Chinese and 2 fishery patrol ships for Korean government are also included. The value amounts to about $150 mil including options, and all contracts are covered by RGs. At the end of June, Daesun secured 21 vessels in its orderbook including options.

Daehan secured 14 vessels worth $622 mil in this period, all of which are aframax tankers. The company secured RG in early May for contracts that it had signed earlier this year, while expecting RG for the rest of contracts in July. Daehan secured two years order cover, up until the second half of 2019.

STX O&S secured 4 x 11.2K PCs for two Korean owners, one of which is an option. The companys orderbook amounts to 18 vessels at the end of June.

Sungdong has no firm new contract yet in this period, while the company is expecting to receive RG for up to 7 aframax tankers (5+2), which is currently in talks with Kyklades Maritime Corp and is expected to be worth around $280 mil. The orderbook amounts to 8 vessels of suezmax tankers and aframax tankers now.


 

TOPICS.


Moon administration is rolling out one populist policy after another (p.2)


Pending challenge for SKorea is to maintain delicate balance between US and China (p.2)


Korea and the US have been voicing differing views on FTA (p.3)


The construction of No 5 and 6 nuclear power reactors suspended (p.4)


Korean girls rallied LPGA golf championships over the world throughout the month (p.6)


US Senate passed fresh batch of crippling sanctions over NKs nuclear and missile programs (p.7)


NK continued launching ICBMs despite the international condemnation (p.8)


SKorea's trade surplus came to $10.6 bil in July, 66 straight months in a row (p.10)


SKorea's national pension funds return rate exceeded 20% in the first half (p.11)


Performance of chaebols in the second quarter of the year (p.13)


The market value of Samsung Group rose by $83.5 bil in the past six months (p.14)


Lotte Chemical Titan went public on the Malaysian stock market (p.15)


KOSPI hit 2,451 on 24th after marking 8 consecutive record highs (p.17)


KWon against USDollar kept being hardened to 1,112 contrary to general expectation (p.17)


Bank of Korea held its benchmark interest rate unchanged at a record-low 1.25% (p.18)


Korean shipbuilders saw sudden rush of orders on the bottom prices of ships (p.18)


Global NB orders recorded 321 units at 23.8 mil dwt for first six months this year (p.19)


SHI delivered first LNG carrier NB equipped with Wartsilas XDF dual fuel engine (p.22)


Seoul Bankruptcy Courts decided to terminate reorganization procedure for STX O&S early (p.23)


KAMCO, KDB and Japans Uni-Asia signed an MOU for Ocean Value-up Fund program (p.23)



-------------------------------------------------------------------------------------------------------


ATTACHMENT: Korea Report - July 2017 (PDF FILE)

Please let us know if you have difficulty opening the file.