China’s shipbuilders have seen new orders continue to improve this year, along with orders on hand. Production, however, is down year-on-year in terms of volume and remains another bleak valley in steel demand's gloomy landscape, Kallanish notes.

China received 52.49 million deadweight tonnes of new ship orders over January-September this year, up 37.9% y-on-y, according to the China Association of National Shipbuilding Industry (CANSI). As a result, orders on hand were up 35.7% in the period to 154.71m dwt.

However, ship completions have continued to decline, falling 14.9% to 26.06m dwt, CANSI figures show. In compensated gross tonnes, which more closely reflect steel demand, this was just 9.47m cgt of ships.

Despite the uptick in new orders this year, the industry is still deemed to be suffering over-capacity by the Ministry of Information and Information Technology, and several of its key players are in financial difficulty.

Jiangsu New East Marine Equipment Co, owned by the Singapore-based JES Holdings, was removed from a list of approved capacity in September, a move which some analysts believed is related to the blacklisting of the parent firm by the Supreme People’s Court of China for refusing to pay around Yuan 15m ($2.44m) relating to lawsuits brought by its equipment suppliers.