Hudong-Zhonghua Shipbuilding Co. began building a self-designed large container carrier early this month while Shanghai Waigaoqiao Shipbuilding Co. recently entered the market for very large crude carriers.

Hudong-Zhonghua set about the construction of a 8,530 TEU (20-foot equivalent unit), making China the fourth country in building such large ships after Korea, Japan and Denmark.

The ship, measuring 334 metres in length and 43 metres in width, can sail at a speed of 27.3 nautical miles per hour. China now has five 8,530 TEU container ships to build, penetrating what used to be a market dominated by Hyundai Heavy Industries Co., Samsung Heavy Industries Co. and Daewoo Shipbuilding & Marine Engineering Co. No other Korean shipbuilder has built a container carrier of that size.

Waigaoqiao debuted in the market for very large crude carriers by receiving orders for four vessels from a tanker operator based in Singapore. Dalian Shipbuilding Industry Co., Nantong COSCO KHI Ship Engineering Co. and Bohai Shipbuilding Heavy Industry Co. are currently building VLCCs in China.

Waigao also cleared its reputation for cutting prices by signing to build a 316,000-deadweight tonnage VLCC for US$115 million, a price close to international levels.

China has nine shipyards with the capacity to build large vessels including VLCCs, according to the Korea Shipbuilders Association. The number is expected to increase to 17 by 2015. Twenty-three shipbuilding docks are scheduled to be completed in China whereas there are only 15 docks large enough to build VLCCs in Korea.

"Our biggest threat is the Chinese, not the Japanese," said a Samsung Heavy Industries Co. official. "The Chinese, who used to build small and less expensive ships, are now making high value-added vessels such as very large crude carriers and super-sized container ships."

Chinese shipbuilders have alarmed Korea and Japan with record orders in the first half of this year. Dalian emerged as the world's fifth-largest in backlog orders with 2.84 compensated gross tons. Waigaojiao was listed as the 10th largest with 1.84 million CGT.