CSSC Scores Mega Order from COSCO as China Doubles Down on Shipbuilding Dominance

China State Shipbuilding Corporation (CSSC) has signed the largest domestic shipbuilding contract in Chinese history, securing an order for 87 vessels worth approximately RMB 50 billion (USD 7.1 billion) from China COSCO Shipping Corporation.

The agreement, formalized in Shanghai on Monday, marks a significant milestone for both Chinese maritime giants and underscores China’s expanding influence in global shipbuilding.

The deal encompasses a diverse fleet including ultra-large containerships, very large bulk carriers, VLCCs (very large crude carriers), grain carriers, multi-purpose heavy-lift vessels, MR tankers, Ro-Pax vessels, and small containerships. Construction will be distributed across six CSSC shipyards: Jiangnan Shipyard, Dalian Shipbuilding Industry, Wuchang Shipbuilding Industry Group, Guangzhou Shipyard International, CSSC Chengxi Shipyard, and CSSC Qingdao Beihai Shipbuilding.

A notable aspect of the agreement is its financial structure. Approximately RMB 47 billion of the total contract value will be settled through cross-border Chinese yuan transactions, representing a record for cross-border yuan settlement in the maritime industry. According to CSSC, “The move provides a new model for the diversification of settlement currencies in CSSC Holdings’s trade.”

China COSCO Shipping Corporation, the country’s largest ocean transportation service provider, operates an extensive industrial chain covering container shipping, dry bulk shipping, oil and gas transport, specialized vessels, and passenger shipping. The company’s listed subsidiaries include COSCO Shipping Energy Transportation, which focuses on energy transport, and COSCO Shipping Holdings, which specializes in container shipping.

Despite the contract’s impressive scale, CSSC Holdings cautioned investors about potential execution challenges. The company noted that “due to the long contract execution period and inclusion of intention orders, revenue will be recognized in accordance with accounting standards.” The cooperation is not expected to have a significant impact on current-period profit, though if the project progresses smoothly, it will have “certain positive effects on the Company’s future revenue and profitability, enhancing medium- to long-term competitiveness”.

The announcement included explicit risk warnings, acknowledging that “given the long execution period and partial intention orders, market dynamics in shipping and shipbuilding may lead to delays or changes in execution.” CSSC emphasized that “this cooperation does not constitute a performance guarantee” and advised investors to “be cautious of investment risks.”

The deal reinforces China’s position in global shipbuilding at a time when the industry faces evolving demands for greener, more technologically advanced vessels. As global maritime powers look to rebuild their shipbuilding capacity, this record-breaking agreement demonstrates the scale and ambition driving China’s maritime industrial strategy.

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