China’s Chishan Group enters shipbuilding with takeover of Baibuting yard

CHINESE industrial conglomerate Chishan Group has entered the shipbuilding sector by acquiring a long-idled shipyard in Shandong province, amid a resurgence of interest in such assets.

The group has acquired 100% of Baibuting Shipbuilding, a private yard in Rongcheng with more than 70 years of history, and has rebranded it as Shandong Fuerdun Shipbuilding. The acquisition marks Chishan’s arrival into shipbuilding and adds new capacity to China’s resurging private yard sector.

Founded in 1953 as Rongcheng Haida Shipbuilding, the yard was once an important manufacturer of steel fishing vessels and bulk carriers. It expanded rapidly following its 2007 acquisition by the Wuhan-based real estate conglomerate Baibuting Group but fell into decline after the 2008 global financial crisis.

The yard delivered 12 vessels between 2009 and 2013, including two 33,000 dwt bulk carriers, according to the data from Clarksons. However, new orders dried up by 2012, and operations were gradually scaled down.

The deal comes after a boom in newbuilding markets during the past several years, with key shipyards operating close to full capacity, limiting their ability to take on additional orders.

This has created opportunities for previously idled private yards to be revived by new investors entering the market. Since 2023, there have been more than a dozen such cases reported publicly.

The most well-known example is Dalian-based Hengli Heavy Industries, which not only secured many orders in a short period of time, but also successfully went public in Shanghai through a backdoor listing.

However, since the beginning of this year, a significant decline in orders — triggered by weakening market demand and geopolitical uncertainties — has raised concerns about the risks of shipyard capacity expanding too quickly.

In the first half of 2025, new orders plunged 54% year on year to 19.8m compensated gt in January-June, according to data from Clarksons. China won 52% of new orders in cgt terms over the six months, versus 70% for the whole of 2024.

Shenwan Hongyuan Securities analyst Wang Chenjian said, however, that earlier concerns over US port fee proposal had weighed on ordering activity, but with the implemented measures being less stringent than expected, confidence is returning, and pent-up demand may drive a rebound in both order volume and pricing.