Chinese yards captured 52 of the 90 LNG carriers ordered worldwide in the first half of this year — 57.8% of the global total — against 37 ships, or 41.1%, for Korea, according to data from Veson Nautical. By simple ship count, China has already overtaken Korea in the segment Seoul has dominated since the 2000s.

The pressure on Korean builders is about to intensify. Hengli Heavy Industry Group, the shipyard that won more orders than any other single yard in China in the first half, is pushing to build two LNG carriers, trade media including Tradewinds reported on 23 July. No buyer has signed. Hengli plans to enter the market on a "build first, sell later" basis — the same playbook it used to break into very large crude carrier (VLCC) construction in 2023 and very large ammonia carrier (VLAC) construction in 2024.

If the plan proceeds, Hengli would become only the sixth Chinese shipbuilder capable of producing LNG carriers, and just the second among private players.

A high-barrier segment, breached by degrees

LNG carriers rank among the most technically demanding ship types afloat. They must carry natural gas in liquid form at minus 163°C, which puts extreme requirements on cargo containment and insulation. Heat ingress vaporizes the LNG, raises tank pressure and creates explosion risk, making insulation performance and boil-off gas management critical disciplines.

Hengli has been preparing since 2024. It began the qualification process for membrane-type cargo containment technology licensed by France's GTT that year and signed a technical assistance and license agreement (TALA) with GTT in January 2025. The membrane system — multiple insulation layers on the inner hull topped with a metal membrane just 0.7–1.2 mm thick — is the mainstream solution for LNG carriers today, and GTT effectively dominates that market.

Five Chinese yards have already delivered LNG carriers: Hudong–Zhonghua Shipbuilding and Jiangnan Shipyard, both under China State Shipbuilding Corp. (CSSC), plus Dalian Shipbuilding Industry Co. (DSIC) and China Merchants Heavy Industry in the state-owned camp, and Yangzijiang Shipbuilding among the privates. Hudong–Zhonghua and Jiangnan form a two-strong structure, but latecomers keep adding LNG orders, sharpening internal Chinese competition as well.

From bankruptcy auction to China's order champion

Hengli's rise has been rapid. Parent Hengli Group entered shipbuilding in 2022 by acquiring the bankrupt assets of STX Dalian — a yard idle since a 2015 court bankruptcy ruling — in the Changxing Island Economic and Technological Development Zone of Dalian, Liaoning province. The acquisition delivered at once a large dock, hull block assembly facilities, goliath cranes, engine facilities and heavy-industry equipment. Hengli restarted the yard in 2023, starting with bulkers and conventional tankers before climbing into VLCCs and VLACs.

The strategy has paid off in volume. Hengli booked 207 orders in the first half of this year, the largest tally of any single shipyard, and its cumulative intake exceeds 500 ships. Roughly 380 of those were scheduled for delivery by 2030 as of end-June.

Korea's edge narrows, but supply chains still favor it

Veson's count covers all sizes from large LNG carriers down to small domestic coastal vessels; Clarksons Research, which tracks only large LNG carriers, recorded 59 such orders globally in the first half of 2025. The divergence in methodology does not change the direction of travel.

Industry observers note Korean yards are reaching the limits of construction capacity while Chinese firms keep improving, so China's growing presence in LNG construction is hard to deny. Korea's overwhelming superiority, in the words of shipbuilding analysts, has disappeared.

"China is catching up with Korea as it builds up more performance and experience in LNG carrier construction," said Um Kyung-a, an analyst at Shinyoung Securities. "Korean shipbuilders need to defend by widening the gap in terms of efficiency and protecting their order domains."

Korea retains one structural cushion: its industrial ecosystem. In a July report, the Korea Trade-Investment Promotion Agency (KOTRA) China trade office noted that China took 80.9% of global newbuild orders in the first half by deadweight tonnage, yet its average localization rate for ship equipment and materials stands at 54%, far behind Korea's 90% and Japan's 95%. The more technically demanding the vessel — LNG carriers, methanol-fueled ships — the lower China's localization rate.

For charterers and energy traders, a broader Chinese LNG carrier production base means more slot availability and sharper price competition at a time when newbuilding demand remains strong. For Korean incumbents, Hengli's entry widens the pool of challengers just as order books stretch toward 2030, and the contest for high-value gas carrier contracts will likely turn on whether Seoul's efficiency and supply-chain depth can hold off Beijing's price-led expansion.