Brazil is now by far the biggest shipbuilding region outside the traditional heartlands of Asia and Europe.
It represents 74% of the “rest of the world” orderbook, as compared with just 4% in 2000, says shipbroker Clarksons.
Brazil’s backlog of work by 1 April 2010 was 89 vessels totalling 4.7 million dwt, the highest it has ever reached.
Clarksons says that with continued technology transfer, such as Samsung Heavy Industry’s investment in Atlantico Sul, coupled with sustained niche and domestic ordering, Brazil looks set to remain “best of the rest”.
Driving most of the growth has been domestic orders from Brazil’s exporters of raw materials, says the broker.
The catalyst came with national oil company Petrobras’s listing in 1997 and the creation of its tanker arm Transpetro.
Petrobras, against the background of a Brazilian government expansion programme and Chinese demand for oil, grew its deepwater operations. Various orders were placed for shuttle tankers and platform-supply vessels (PSVs).
This month, China overtook the US as the largest consumer of Brazilian crude, while China’s appetite for iron ore has seen Brazilian mining major Vale start building its own dry-bulk fleet to cut its reliance on chartered vessels.
Clarksons highlights the fact that last October it was reported that under pressure from President Lula, Vale held talks with domestic shipyards to order 400,000-dwt bulkers. A deal has yet to materialise and Clarksons says the largest ships being built in Brazil are a series of 150,000-dwt suezmaxes at Atlantico Sul.
It has a drydock that could build capesize bulkers but it lacks the experience to do so.
Back in 1986, Ishikawajima Do Brazil delivered a 300,000-dwt bulker but lack of investment and incentives by the Brazilian government resulted in the industry declining, says Clarksons.
Now, politics is driving Brazil’s resurgence, although there remains the question of pricing and value for money, as well as lower productivity compared with Asian yards, adds the broker.