Report of Joint Working Group on Ship Scrapping
The IMO posted on its Internet site the Report of the Joint Working Group on Ship Scrapping . Representatives from the International Labor Organization (ILO), the IMO, and the Basel Convention (BC) met in Geneva on 12-14 December to continue discussions on development of a regime to address international ship scrapping. The goal is to draft a legally binding instrument on safe and environmentally sound ship recycling. Source: HK Law
Ship Scrapping Now a Money Maker
According to an April 8 report from China Daily, as the shipbuilding industry struggles to recover from the global recession, China's ship scrapping business has become a smorgasbord for both factories and investors. Ship breaking or ship demolition companies usually buy in vessels and sell the scrap to iron and steel companies nearby to book a profit. The price of iron and steel scrap has risen to more than $400 per ton from $150 per ton last year. (Source: China Daily)
Government May Recall Ghost Ships
The government may bring an end to the Ghost Ships by recalling them, reports the Northern Echo. Reclamation company Able UK has been battling for more than three years to carry out an 11m deal to scrap 13 former US Navy ships at its site on Teesside. Now MarAd has temporarily halted its ship-scrapping program and ordered a review of the Able UK contract. Source: Northern Echo
Ship Scrapping Knocked, But Alternatives Elusive
Government and environmental leaders reportedly criticized procedures for scrapping old ships, but offered few alternatives for improving the poor safety and environmental record of the industry.
COSCO Receives Fund for Fleet Renewal
China COSCO Holdings Co Ltd says it has received ship scrapping subsidies for about 3.96 billion yuan ($638.71 million). It came through China Ocean Shipping, the controlling shareholder of the company, for the decommissioning and upgrading of vessels. “The subsidy was recognized as non-operating income and will be included in the profit and loss of the company for the year ending 31 December 2015 to compensate the losses suffered by the company due to the advanced disassembling of the vessels,” Cosco said in a stock exchange filing. The subsidies were received by Cosco on 30 June 2015.
Heightened Scrutiny On Ship Scrapping
Ever since two enterprising reporters for the Baltimore Sun decided, in 1997, to take a closer look at ship scrapping, first at a Baltimore shipyard dismantling a Navy ship, and subsequently an in depth review of scrapping conditions in Alang, India, the light of public attention has been shining on this oldest of maritime practices. With this scrutiny, the world of scrapping ships will be forever changed — hopefully for the better. Following the end of the Cold War, the Navy's downsizing its fleet, and the requirement to replace tankers with more modern and environmentally safer ships, the demand to decommission and dispose of obsolete vessels is increasing at a pace more rapid than the capacity exists to handle this demand. Certainly, this is true in the U.
Ship Scrapping Up 5% In 2Q
Tanker scrapping shot up while the disposal of bulk carriers diminished as the total deadweight tonnage of ships sold for demolition rose by five percent in the second quarter of this year from the first quarter. Approximately 7.7 million dwt of ships were scrapped in the second quarter, up from nearly 7.4 million in the first. Tanker scrapping in the second quarter increased by 27.5 percent to 3.7 million dwt although the number of vessels stayed the same at 29. Dry bulk carrier sales for demolition fell by 13 percent to 92 vessels of 3.4 million dwt from a previous 104 of 3.96 million dwt.
Profitability Of Bulk Shipping Dependent On Safety
Bulk shipping has been under the international microscope of late, with spectacular structural failures resulting in sudden loss of lives and ships, vexing designers, builders and owners alike as to the solution to structural and operational problems. Last week industry experts discussed another matter near and dear to bulk shipper's hearts, the future profitability of the depressed bulk shipping business. The overriding message: bulk shipping profitability is inextricably linked to safety and environmental controls. Removing poor quality operators through strict enforcement of international regulations could reduce the capacity oversupply that has caused low freight rates in the tanker and bulk shipping sectors, they said at a London Conference organized by the City University.
Shipping Industry Slumps, but Ship Scrapping Looks Up
While the shipping industry struggles through a historic downturn, ship scrapping business is seeing accelerating demand, reports WSJ. The global economic slowdown is putting shipping through its most bruising period since the 2008 financial crisis. With the capacity running some 30% ahead of shipping demand, orders for new vessels have fallen to a record low this year and companies can’t get rid of ships fast enough. In the five years to last year, owners ordered an average of 1450 ships annually.
China's Scrap Yards Apply for EU Regulation
China's Zhoushan Changhong International Ship Recycling and Jiang Xiagang Changjiang Ship Recycling Yard, world’s two biggest ship scrap yards by capacity, have applied for the inclusion of their facilities in the future EU list of Ship Recycling Facilities. Two leading Chinese ship recycling yards have applied for inclusion of their facilities in the future EU list of Ship Recycling Facilities, according to Chinese media. The official documents for the application were presented yesterday in Brussels to Mr. Julio Burgués, Head of the Unit Waste management & Recycling of the European Commission’s Directorate General for Environment by Mr Li Hongwei owner of Zhoushan Changhong International Ship Recycling Co., Ltd and Jiang Xiagang Changjiang Shiprecycling Yard.
Maersk Line CEO Cautiously Optimistic
Tim Smith, Maersk Line’s North Asia CEO, reflects on 2012 being quite a volatile year, but sees an increase in the Asia-Europe container trade. The biggest challenge for the entire industry is overcapacity, said Smith. “In these volatile markets we have seen a lot more capacity coming into the market the last couple of years than is needed by the lower levels of demand. ” Last year that overcapacity was managed tolerably well by taking out ships, scrapping them, slowing ships down or idling them for shorter or longer periods. “We managed to balance supply and demand,” said Smith, “and that is the game we need to play again in 2013. ” 2012 was “a bit of a roller-coaster for us and for our customers,” said Smith.
Braemar Asks: Is Another Demolition Spike Due?
As the Baltic Dry Index plumbs all-time depths, those with long memories are recalling the dark days of the 1980s for the shipping markets. However, steel traders can look forward to a bumper year of supply of vessels for recycling this year, if previous experience offers a guide for the 2012 outlook. Bets are now being taken about how many vessels will be forced by the weak freight markets into the arms of recyclers. Globally, ship scrapping capacity has very big limits being a simple business of driving ships onto beaches and cutting them up with oxyacetylene torches.
Tanker Freights’ Declining Rate to Continue
Global tanker freight rates may be depressed for several more years as a stream of new vessels hit the market and shipowners refrain from scrapping older ships. However, a recovery is likely toward the end of the decade as more single-hulled tankers are taken off the market to meet regulations for safer ships. Tanker rates jumped to record highs in 2004 as a surge in oil trading and demand strained available fleet supply, but they have since retreated despite the still-booming markets for commodities such as oil, copper and sugar. The rate for a supertanker on the benchmark Middle East-Japan Very Large Crude Carrier (VLCC) reached a peak of about WorldScale 344 in November 2004, but has since fallen back to around W65, data from the Baltic Exchange showed.
India’s Shipping Market Looks Bullish
The shipping market in India could soon be out of bounds for global fleet owners as a key tender condition that tilts the scale in favour of local ship-owners is scrapped, reports Livemint. According to the rules set by the director general of shipping, India’s maritime regulator, in 2004 to extend cargo support and develop the local shipping industry, Indian ship has the right of first refusal to match the lowest rate quoted by a foreign-flag ship and take the contract. The director…
China Ship Scrapping Subsidies Extended to 2017
Ship scrapping subsidy program originally due to run to end-2015; show of government support amid continuing industry downturn. China on Tuesday extended by two years a subsidy programme that encourages shipping companies to scrap old vessels in a bid to support an industry struggling to emerge from a global downturn. The scheme, which began in 2013 and was due to end this year, gives shipping lines grants of 1,500 yuan ($241.67) per gross ton to replace old vessels with newer, more environmentally friendly models. These subsidies helped state-backed shippers including China COSCO and China Shipping Development to post a higher 2014 profit despite the slump in the global industry. China Cosco said it would have posted a loss had it not been for the subsidies.
Ship Glut Burdens LNG Tanker Market, Slashes Profits
Deliveries of new gas tankers have created a glut that is threatening to tip some operators into losses, just as other shipping markets emerge from their worst downturn in decades. The liquefied natural gas (LNG) tanker market was until recently the only bright spot in an otherwise depressed freight industry. A global surge in the demand for gas, led by Japan in 2011, boosted trade, tied vessels to longer routes and drove rental rates to record highs. But the 119 new carriers ordered from 2011 will have expanded the fleet by over 30 percent by end-2017.
GL Bolsters Support of Green Ship Recycling in Asia
Hamburg/Shanghai, 3 May 2011 - Germanischer Lloyd (GL) has recently intensified its efforts to help shipyards, ship owners, suppliers and recycling facilities in Asia to comply with the forthcoming International Convention for the Safe and Environmentally Sound Recycling of Ships ("Hong Kong Convention"). Two well-trained GL ship recycling experts are now stationed in China and Singapore respectively, offering all stakeholders a full range of services including certification, consultancy and tailored training.
Ship Recycling Discussed at IMO
The Marine Environment Protection Committee (MEPC) of the International Maritime Organization (IMO) considered the first draft of a proposed new international instrument on ship recycling when it met for its 54th session from 20-24 March. Other issues on the agenda included ballast water management and air pollution from ships. The Committee also adopted a number of amendments to the MARPOL Convention. The MEPC made progress in developing the draft text of a mandatory instrument providing globally-applicable ship recycling regulations for international shipping and for recycling activities. A Working Group on Ship Recycling met during the session to work on the draft text and discuss related issues.
Will COSCO-CSCL Marriage Happen Soon?
The ocean carrier merger - between China’s two state-owned megacarriers, COSCO and CSCL - rumours are back in the news! The beleaguered state behemoths struggling in a protracted industry slump - China Ocean Shipping Group (Cosco) and China Shipping Group - were ordered to come up with a merger plan late Thursday, sources told the South China Morning Post. The mainland’s two largest shipping and logistics conglomerates together control 11 listed entities in Shanghai, Shenzhen, Hong Kong and Singapore.
Fresh Hopes in Container Shipping: Alphaliner
The new year brings with it fresh hopes for a recovery in container shipping although the market remains fundamentally imbalanced, says an Alphaliner report. A slew of new records were set in 2016 but most of them marked new lows for a container shipping market that continues to suffer from excess capacity, with the weakness expected to persist for at least one more year. The global containership fleet grew by only 1.5% to reach 20.27 Mteu at the end of 2016, the lowest annual growth rate ever recorded in the industry’s history.
Ship Scrapper Plead Guilty to Environmental Crimes
Steven E. Avery, 56, of Bohannon, VA, Billy J. Avery, 81, of Virginia Beach, VA, and the corporation Sea Solutions, Inc., all pleaded guilty yesterday in Norfolk federal court to various environmental crimes stemming from their activities in the ship scrapping business. Neil H. MacBride, United States Attorney for the Eastern District of Virginia, made the announcement that the plea was accepted by U.S. District Judge Arenda L. Wright Allen. The three will all be sentenced on July 12, 2012.
Baltic Index Slump Continues on Demand Concerns
The Baltic Exchange's main sea freight index, which tracks rates for ships carrying industrial commodities, touched a record low for the ninth straight session Friday, mostly due to vessel oversupply and lack of global demand. The overall index, which gauges the cost of shipping dry bulk cargoes including iron ore, cement, grain, coal and fertiliser, was down 10 points, or 2.61 percent, at 373 points. The index has plunged by over hundred points or about 22 percent this year. On Wednesday, it fell below 400 points for the first time on record. The capesize, panamax and handysize indices also touched record lows on Friday. The dry bulk sector has taken a beating from the slowdown in Chinese business at a time when the sector is struggling with huge overcapacity.
BIMCO: Containership Scrapping Heats Up
demolition of containerships almost tripled in the first five months of 2016 in comparison to the same period of 2015. This illustrates the efforts carried out by shipowners to counter the fundamental imbalance between supply and demand under poor container shipping market conditions. However, more needs to be done to lift the charter market. The demolition of capacity in the panamax segment (3-5,999 TEUs), since the start of January 2016 till the year to date, has been especially significant.