2011 is a peak year for ship recycling with about 40 million DWT; the global amount has reached its highest level since 1986. In the past 3 years, from 2009-2011, the ship recycling trade volume was released, including 20-year old ships: dry bulk carriers, container ships and single shell oil tankers. The ship recycling market will probably go into recession in the second half of 2012 or into a dilemma with "no ships to recycle". It will no doubt be a blow to those small and medium-sized shipping enterprises that have just shifted to ship recycling.
The profit of the ship recycling industry mainly depends on two ends:
Ø the upstream of supplying old or unseaworthy ship resources and
Ø the downstream of demand for iron and steel scrap.
Due to the impact of the delivery, the shipbreaking period, and upstream and downstream price changes,
's shipping enterprises will
be confronted with an increase of ship recycling volume and a drop, or even
losses, in the economic efficiency of shipbreaking. China
Some enterprises aim to develop themselves into the biggest global ones for ship recycling by seizing more market share, but people in the field worry that when these enterprises develop new capacity blindly, they might repeat the mistakes and failures of the shipbuilding industry in recent years, which will lead to a waste of resources.
Source: Noodls. 1 December 2011http://www.noodls.com/viewNoodl/12308937/dalian-municipal-government/peak-year-for-ship-recycling