Newbuilding activity plunge as uncertainty clouds outlook

Newbuilding contracting has plummeted over the first few months of 2025, reaching historically low levels as shipowners avoid long-term investment decisions.A number of factors such as high newbuilding prices, USTR proposal, trade uncertainty and regulatory ambiguity have resulted in a sharp decline in new orders so far in 2025.

The subdued ordering activity will persist until at least October 2025, with only a gradual recovery anticipated thereafter, whilst a more substantial rebound in new orders is likely to materialise from 2028, according to a market analysis from Drewry.

The plunge in newbuilding activity comes on the heels of geopolitical disruptions and ongoing tariff wars combined with increasing concerns over China-made ships and uncertainty with respect to global regulatory environments, including the IMO’s net zero framework.

In accordance with the analysis, new orders are expected to remain muted until October 2025 with a slow recovery expected after the IMO session in October, if adopted.

In any case, the ordering activity is expected to be below historical levels until 2027 when the IMO will make clear incentives for ships employing zero or near-zero fuels and technologies.