Chinese shipbuilder Cosco Shipping Heavy Industry is reportedly closing down three shipyards as part of its efforts to cut overcapacity.

According to a Saturday report by China Daily, China's English-language newspaper, the company is planning to shut down three of its five shipyards, which are able to manufacture offshore engineering products, by 2020 as its sees no notable upturn in the global market any time soon.

The plan entails for the Nantong, Zhoushan, and Dongguan shipyards to be shut down while the manufacturing bases in Qidong and Dalian will be kept open as they are capable of building high-end offshore engineering products like polar vessels and drilling platforms, the news report further elaborated.

A few months ago, China Cosco Shipping Group integrated its shipbuilding assets into one unit, Cosco Shipping Heavy Industry, and launched it in a ceremony held in Shanghai in December 2016.

Also by the end of 2020, the Shanghai-based company reportedly plans to halve the delivery capacity of its offshore engineering products from 18 to 9 due to lower demand in the last three years.