COVID-19: Mediterranean shipyard boom amid China bust

Hudong-Zhonghua Shipbuilding. Credit: Dietmar Hasenpusch

Shipyards in Turkey and Greece experienced increased drydocking and retrofitting requests in the wake  of Chinese shipyard closures due to the coronavirus outbreak.

Since the outbreak of the virus, ONEX Syros shipyards based on Syros island in the Aegean Sea, have had more than 120 drydock requests. This has breathed new life into the yard into the previously named Neorion Shipyards faced bankruptcy in 2019 and only remained open thanks to heavy US private investment.

Besiktas Shipyard in Yalova, north-western Turkey, has echoed this trend. After expanding into a neighbouring yard and being at almost full capacity, the drydock requests continue to be submitted, according to Yavuz Kalkavan, chief executive of Besiktas Shipyard.

Despite the re-opening of certain state-owned shipyards in China, including Jiangnan shipyard and Hudong Zhonghua Shipbuilding near Shanghai, less than 50% of the workforce has returned to work. This is due to the provenance of the yard workers, mostly from the Chinese provinces that need to spend 14 days in quarantine before they can return to work, further exacerbating yard delays.

Statistics released from the China Association of the National Shipbuilding Industry (CANSI) has found that the ratio of work resumption for Fujian and Lianong province has reached 75% while Zhejianf province remains at 66.7%.

The knock-on effect of these closures is being felt by Japanese and south Korean shipyards that are dependent on equipment and parts produced by these yards. In some cases, Chinese equipment suppliers and manufacturers have declared a force majeure.

Ship owners and managers face not only monumental costs of having their ships sit idle in yards in China, but also for those awaiting scrubber retrofits, now that the IMO 2020 deadline has passed, face compliance issues.