Yogender Singh, India, Asia-Pacific Correspondent07.07.23
Vietnam is gradually becoming a major ship-building hub in the South East Asia region, providing a boost to marine coatings in the country. Current order book of major ship-builders and repair companies indicate that next few years would be very fruitful for the country’s marine coating sub-segment. Coatings World examines the state of marine coating industry in the country in this feature.
Maritime industry has been declared a priority sector by the Vietnamese Government and is on track to become one of the largest shipbuilding and ship repair hubs in Asia. The demand for marine coatings across both domestic and foreign shipping fleets that are dry-docked in Vietnam is projected to grow significantly over the next few years. Over the past two years, drydock capacity has doubled in response to demand shifting from China due to Covid-19 lockdowns, plus the growth of the country’s own domestic fleet.
Global ship-building industry leaders, such as South Korean company Hyundai Vietnam Shipbuilding, are playing a major role in Vietnam’s emergence as a global ship-building hub. Hyundai Vietnam Shipbuilding, a joint venture between Hyundai Mipo Dockyard Co. and Vietnam's state-run Shipbuilding Industry Corp. in 1996 -- represents South Korea's first overseas shipyard.
Hyundai Vietnam Shipbuilding, which is located in the central Vietnamese province of Khanh Hoa, has delivered 157 ships since its first delivery of a 56,000-ton bulk carrier in 2009. The company currently has an order backlog of 924,000 compensated gross tons, or 74.4 percent of Vietnam's total backlog of 1.24 million CGTs. Hyundai Vietnam Shipbuilding has set its sales target for this year at $543.8 million, or 13 vessels.
Hyundai Vietnam Shipbuilding Co., a unit of South Korean shipbuilding, oil refining and machinery conglomerate HD Hyundai, has recently won an order to build two oil and chemical tankers for an African shipping company.
Vietnam’s shipbuilding industry is expected to get a further boost in large part to the country’s efforts to develop its supply chain industry and benefits from ‘China plus’ sourcing strategies of major multinational manufacturers.
“We estimate that the total demand for marine coatings from domestic owners alone could be worth US$35 million in the medium term and even more when you consider the opportunity for foreign ship maintenance and repair in Vietnam, which continues to grow. We anticipate a 15-20% market share of the marine coatings market within the next five years,” according to Ee Soon Hean, General Director, Nippon Paint Vietnam
“We have expanded our footprint in Vietnam to include marine coatings. Continued growth in the maritime sector is resulting in the expansion of all the major shipbuilding and repair hubs in the country. There are six large yards in the north, the same in the south and two in central Vietnam. Our research indicates that there are approximately 4,000 vessels that will require coatings, including new-builds and existing tonnage,” adds Soon Hean.
Nippon Paint’s existing facilities in industrial zones in the north, south and central regions of Vietnam will begin producing the company’s range of marine anticorrosion and protective coatings imminently, with hull and antifouling products set to be added to production lines during the next two years.
Though parent company Nippon Paint has had a presence in the country since 1989, producing decorative and automotive coatings from production plants outside Ho Chi Minh and Hanoi, the Vietnamese maritime industry has, until this year, been served by Nippon Paint Marine Singapore.
A leader in marine coatings, Norwegian paint producer Jotun has been operating in Vietnam since 1993. Initially, the company entered only with imported products, catering to marine and industrial coatings. Later on the Norwegian paint maker set up its production facility in the country. A couple of years back, Jotun invested USD 100 million in setting up a new water-based and powder coatings factory in Hiep Phuoc Industrial Park of Ho Chi Minh City. The new production facility has an installed capacity of 85 million liters of water-based paints and 10,000 tonnes of powder coatings.
An executive from Jotun Vietnam’s sales team told Coatings World on the condition of anonymity, “For marine coatings, we anticipate strong demand for both ship repairs and new ships. Sales of ship repair coatings has been growing substantially during last few years thanks to expansion in demand for environmentally friendly ship repair coatings in particular. Meanwhile, high value-added products now account for a higher percentage of ship repair coating sales as compared to a few years back.”
Another leading player in marine coating domain, AkzoNobel operates four locations in HCMC, Dong Nai, Binh Duong, and Bac Ninh, supplying products for both Vietnamese and the regional market.
During a visit of company’s manufacturing facilities in Vietnam, Michael Friede, chief commercial officer at AkzoNobel said, “We supply sustainable and innovative paints and coatings that our customers, communities, and the environment are increasingly relying on. Our world-class portfolio of brands is trusted by customers around the globe. We provide marine coatings for large ships which need to be protected from saltwater and be as smooth as possible to save energy and stay free of any marine life and biowaste. Our anti-corrosive protection, fouling control technologies, passive fire protection, and aesthetic solutions are underpinned by unrivalled customer service and in-field support.”
Overview of ship-building industry in Vietnam
Vietnam has number of ingredients to emerge as a major shipbuilding destination. The country is located on an important maritime transport route in the East-West hemisphere, accounting for more than 80 percent of global freight volume. Vietnam benefits from a long coastline that borders the Gulf of Thailand, the South China Sea, and the Gulf of Tonkin. The country has the second-highest number of international ports in ASEAN after the Philippines. It is among 10 top countries with the highest length of the coast line.Maritime industry has been declared a priority sector by the Vietnamese Government and is on track to become one of the largest shipbuilding and ship repair hubs in Asia. The demand for marine coatings across both domestic and foreign shipping fleets that are dry-docked in Vietnam is projected to grow significantly over the next few years. Over the past two years, drydock capacity has doubled in response to demand shifting from China due to Covid-19 lockdowns, plus the growth of the country’s own domestic fleet.
Global ship-building industry leaders, such as South Korean company Hyundai Vietnam Shipbuilding, are playing a major role in Vietnam’s emergence as a global ship-building hub. Hyundai Vietnam Shipbuilding, a joint venture between Hyundai Mipo Dockyard Co. and Vietnam's state-run Shipbuilding Industry Corp. in 1996 -- represents South Korea's first overseas shipyard.
Hyundai Vietnam Shipbuilding, which is located in the central Vietnamese province of Khanh Hoa, has delivered 157 ships since its first delivery of a 56,000-ton bulk carrier in 2009. The company currently has an order backlog of 924,000 compensated gross tons, or 74.4 percent of Vietnam's total backlog of 1.24 million CGTs. Hyundai Vietnam Shipbuilding has set its sales target for this year at $543.8 million, or 13 vessels.
Hyundai Vietnam Shipbuilding Co., a unit of South Korean shipbuilding, oil refining and machinery conglomerate HD Hyundai, has recently won an order to build two oil and chemical tankers for an African shipping company.
Vietnam’s shipbuilding industry is expected to get a further boost in large part to the country’s efforts to develop its supply chain industry and benefits from ‘China plus’ sourcing strategies of major multinational manufacturers.
Overview of marine coatings market in Vietnam
Leading multinational paint companies and domestic producers operating in Vietnam have started to adjust their capacities to cater to the growing demand of marine coatings in the country. Recently, Nippon Paint Vietnam announced to expand its marine coatings production in the country, in response to the growing market demand for these products.“We estimate that the total demand for marine coatings from domestic owners alone could be worth US$35 million in the medium term and even more when you consider the opportunity for foreign ship maintenance and repair in Vietnam, which continues to grow. We anticipate a 15-20% market share of the marine coatings market within the next five years,” according to Ee Soon Hean, General Director, Nippon Paint Vietnam
“We have expanded our footprint in Vietnam to include marine coatings. Continued growth in the maritime sector is resulting in the expansion of all the major shipbuilding and repair hubs in the country. There are six large yards in the north, the same in the south and two in central Vietnam. Our research indicates that there are approximately 4,000 vessels that will require coatings, including new-builds and existing tonnage,” adds Soon Hean.
Nippon Paint’s existing facilities in industrial zones in the north, south and central regions of Vietnam will begin producing the company’s range of marine anticorrosion and protective coatings imminently, with hull and antifouling products set to be added to production lines during the next two years.
Though parent company Nippon Paint has had a presence in the country since 1989, producing decorative and automotive coatings from production plants outside Ho Chi Minh and Hanoi, the Vietnamese maritime industry has, until this year, been served by Nippon Paint Marine Singapore.
A leader in marine coatings, Norwegian paint producer Jotun has been operating in Vietnam since 1993. Initially, the company entered only with imported products, catering to marine and industrial coatings. Later on the Norwegian paint maker set up its production facility in the country. A couple of years back, Jotun invested USD 100 million in setting up a new water-based and powder coatings factory in Hiep Phuoc Industrial Park of Ho Chi Minh City. The new production facility has an installed capacity of 85 million liters of water-based paints and 10,000 tonnes of powder coatings.
An executive from Jotun Vietnam’s sales team told Coatings World on the condition of anonymity, “For marine coatings, we anticipate strong demand for both ship repairs and new ships. Sales of ship repair coatings has been growing substantially during last few years thanks to expansion in demand for environmentally friendly ship repair coatings in particular. Meanwhile, high value-added products now account for a higher percentage of ship repair coating sales as compared to a few years back.”
Another leading player in marine coating domain, AkzoNobel operates four locations in HCMC, Dong Nai, Binh Duong, and Bac Ninh, supplying products for both Vietnamese and the regional market.
During a visit of company’s manufacturing facilities in Vietnam, Michael Friede, chief commercial officer at AkzoNobel said, “We supply sustainable and innovative paints and coatings that our customers, communities, and the environment are increasingly relying on. Our world-class portfolio of brands is trusted by customers around the globe. We provide marine coatings for large ships which need to be protected from saltwater and be as smooth as possible to save energy and stay free of any marine life and biowaste. Our anti-corrosive protection, fouling control technologies, passive fire protection, and aesthetic solutions are underpinned by unrivalled customer service and in-field support.”
Leading marine coating producers in Vietnam |
||||
4 Oranges Company Limited | Long An province | 100 million litres and 60,000 tons of plastic paints | 2004 | A subsidiary of Thailand’s 4 Oranges company. |
Nippon Paints Vietnam | Dong Nai, Hanoi and Vinh Phuc provinces | 25,000 tons per annum | 1994 | |
Jotun Vietnam | Binh Duong province and Ho Chi Minh City | 130 million litres per annum and 10,000 TPA of powder coatings | 1998 | |
PITCO (Petrolimex International Trading Joint Stock Co.) | Binh Duong | 8 million litres/ annum | 2010 | A unit of Vietnam National Petroleum Corp. (Petrolimex) |