Shagang Holding Group Co., one of China's largest private steel producers, is moving into shipbuilding as the global shipping industry experiences a boom in orders. The company established Jinsha Heavy Industry (Tianjin) Co. Ltd., a wholly owned subsidiary with registered capital of 70 million yuan ($10.5 million), according to corporate registry database Qichacha. The company, incorporated on Oct. 8, has a business scope that includes shipbuilding, vessel design and repair, as well as making marine-engineering equipment.
The global shipping market has been convulsed this year by the war in the Middle East, which has supercharged freight rates, boosted demand for second-hand vessels and stirred interest in ordering carriers built from scratch. Global order volumes have been surging, straining yard capacity, as fleet-renewal needs and a push for decarbonization also drive demand.
Chinese steelmakers are major suppliers to the shipbuilding industry, and some have invested in the sector, but it is uncommon for a mill to establish a wholly owned unit specifically to make ships. Shagang's move comes as overall domestic demand for steel weakens amid persistent oversupply. Company officials couldn't immediately comment on the venture when contacted by Bloomberg News.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing