THE price of new ships will rise sharply over the rest of the 1990s followed by a significant decline in the first half of the next decade, according to Ocean Shipping Consultants. In a recent study of world shipbuilding, the British-based group predicted a rise in the price of very large crude carriers, from US$82 million to $99.5 million. The price would then fall to $77 million by 2005. This trend would continue for other classes of vessels until 2000-2005, but the fall in prices would not be enough to compensate for increases in the following five years. The study predicted that total shipbuilding activity would rise from 12.5 million compensated gross tonnes (cgt) this year to more than 16.75 million cgt in 2000, falling to 11.5 million cgt by the end of 2005. For total world shipbuilding, the report forecast 136.2 million gross tonnes (gt) of newbuilding demand to 2000, with a further 104.4 million gt projected for the 2001-05 period. In average annual terms this was about 22.7 million gt for the rest of the 1990s and 20.9 million gt per year thereafter. Tankers would account for about 42 per cent of the overall forward study period newbuilding total and bulk carriers for just under 22 per cent of the overall aggregate, with container ships accounting for a further 20 per cent of the aggregate. Total gas carrier newbuilding demand was expected to be about six per cent of world demand in the forward period - equivalent to 14.2 million gt. For the 'others' category - including general cargo vessels, cruise-passenger vessels, offshore supply ships, fishing boats, etc - newbuildings were expected to account for about 11 per cent of shipbuilding activity in the study period, amounting to about 27.4 million gt. The main increase in new building activity was forecast for the tanker sector. Average annual shipbuilding was set to be about nine million to 9.5 million gt for the forward study period, against the 5.7 million gt output seen last year. For other sectors, last year's high level for bulk carrier completions - 6.3 million gt - was set to be approached throughout the rest of the 1990s, with an average annual level of 5.8 million gt, before falling back to less than four million gt in the next five years. Significant growth was expected for container ship construction volumes - after doubling from about 1.7 million to 3.1 million gt from 1990 to 1994, further significant expansion was forecast to an average annual level of four million gt for the rest of the 1990s and 4.5 million gt for the following five years. The total cost (at current prices) of the tanker newbuilding volumes required about $74.13 billion which included the current order book volume of about $12.4 billion. Net new tanker orders over the period to 2005 were about $61.7 billion in total. For bulk carriers, the current order book was about $14.9 billion in total, against a total forward newbuilding value of $37.5 billion. For container ships, the total value of estimated newbuildings equated to $90 billion, against a current order book value of $14.8 billion. For the three principal vessel types, the current orderbook value was about $42 billion, with the total value of newbuildings for the period to 2005 estimated at $201.7 billion. While shipbuilding activity expansion for the 1994-2000 period was expected to be widespread, regional growth was set to be far from uniform. The greatest gain in output volumes was set to be seen in the expanding South Korean industry. In this case, after the completion of 4.1 million gt last year, the total was expected at more than seven million gt by the end of the decade, with a subsequent decline to about 4.5 million gt by 2005. For Japan, the massive 8.6 million gt performance last year was set to be exceeded by about 1.5 million gt by 2000. The subsequent decline was expected to see the annual volume fall to about 6.5 million gt by 2005. In west Europe, total completions were expected to approach four million by 2000 although substantial reduction to about 2.7 million gt was expected for the following five years. Other European output was forecast at 1.7 million gt in 2000 with other Asian output set to rise to well over the two million gt level. In terms of relative activity development, the South Korean share of world shipbuilding output was expected to advance from 21.5 per cent last year to about 29 per cent by 2000 with a subsequent average of over 25 per cent (27 per cent in 2005). The Japanese share was expected to decline - from 45.5 per cent last year to just under 39 per cent by 2000, with an end-period projected share of about 37.5 per cent. Elsewhere, the west European share was expected to average 15-17 per cent throughout the forward period, with the share for the rest of Europe set to advance from 6.5 per cent last year to about 8.5 per cent by the end of the study period. Increased relative significance would also be noted for other Asian shipbuilders. The market share for this sector was expected to rise from 7.5 per cent last year to 10 per cent by 2005. Total world shipbuilding capacity was expected to increase from 17.5 million cgt this year to about 21 million cgt by 2000 with capacity expansion thereafter expected to be at best marginal. Total shipbuilding activity was expected to rise from this year's 12.7 million cgt to about 16.75 million cgt in 2000 before declining to below 11.5 million cgt by the end of the subsequent half-decade. The expected overall profile of newbuilding price development was one of price escalation over the remainder of the 1990s, followed by a significant price decline in the first half of the next decade. This was directly related to the closely matched shipbuilding capacity and activity expansion of the 1990s and the subsequent marked decline in newbuilding demand.