The rising tide lifts Romanian shipyards to new heights

Production facilities fully booked until 2007; sale prices rising fast; heavy pressure from demand; permanent visits from new clients.

Ailing until last year, the Romanian shipyards are starting to take part in the rebound of the international line industry, remembering the good times prior to 1990.

“This is a time of almost unprecedented boom. We are fully booked until 2006 but have orders for 2007, as well. Still, we get visits from foreign ship owners almost constantly. There is demand for all the types of ship we make,” says Stelian Stancioiu, Severnav general manager, summarising the situation of the entire Romanian shipbuilding industry.

The main reason for this is the economic growth in Asia (especially in China and Japan) which has led to an unprecedented increase in the maritime trade, convincing ship owners they had better enlarge their fleets.

The strong growth in the demand for steel on the Chinese market has led to maritime trade in the raw materials required to make steel (coal and iron ore) reaching all time highs. The same goes for the oil industry.

Ships are estimated to transport about one billion tonnes of coal and iron ore this year, compared with 800 million tonnes in 2001 and 600 million tonnes in 1991. Furthermore, the new regulations for the transportation of oil and liquefied gases have been introduced worldwide, forcing ship owners to replace their old ships with new ones whose walls are two or three times thicker.

The international shipbuilding market has therefore reached its ten-year peak; orders for ships account for some 21% of the total worldwide fleet, after having remained at 10%-15% for years.

Practically every shipyard operational at the moment is working at full capacity.

“This is a period of recovery from the attacks of September 11, 2001. Ship owners placed very few orders in the last few years, because no one wanted to take the chance of buying something that takes 20 years to amortise. Now that the Asian economy is growing and the new regulations have been introduced, every ship owner is either upgrading or enlarging their fleet,” says Alexandru Popescu, planning manager of the Braila shipyard, held by Norway’s Aker Group.

This wave of international growth has also reached Romania this time. Every Romanian shipyard, regardless of the sizes and types of ships it builds, has received orders that will keep them busy, to the fullest extent, for the next three years.

Subsequently Severnav (still unprivatised) anticipates revenues of at least $20-$30 million a year (after $10 million in 2003), while Aker Braila expects to be back in the black after losses during the last few years. Damen Galati (part of the Dutch Damen Group) is making $15 million investments to boost production capacity and Daewoo Mangalia estimates turnover to increase by 15% this year, having hundreds of millions of dollars in contracts for the period until 2007.
laurentiu.ispir@zf.ro