With unsustainably low shipping rates and overcapacity, vessel owners are sending ships to scrap yards, such as the one in Alang, India.
Beached ships await recycling at Alang, India, site of one of the world’s largest ship-scrapping operations. KARAN DEEP SINGH/THE WALL STREET JOURNAL
A worker cuts through metal at a ship-breaking operation in Alang. KARAN DEEP SINGH
Workers pull a metal rope attached to the M.V. King David, a bulk carrier that used to carry iron ore from Australia to China. KARAN DEEP SINGH/THE WALL STREET JOURNAL
Workers pull a metal rope attached to the M.V. King David, a bulk carrier that used to carry iron ore from Australia to China.
About 1,000 ships that have the combined capacity to haul 52 million metric tons of cargo—about the weight of 142 Empire State Buildings—will be dragged onto beaches, cut into pieces and sold for scrap metal this year. KARAN DEEP SINGH The last portion of the bulk carrier M.V. King David, sits beached for scrap.
The last portion of the bulk carrier M.V. King David, sits beached for scrap.
The global economic slowdown is putting shipping through its most bruising period since the 2008 financial crisis.
The typical age for recycling a ship is 30 years. This year the average age of ships getting scrapped is about 15 years, says Anil Sharma, president and chief executive of U.S.-based Global Marketing Systems, the world’s largest cash buyer of ships for recycling
In the past, recycling a ship typically generated about one-quarter of the price of a new vessel of the same type and size. But owners say a sharp drop in the price of steel has cut the rate of return to an average of 10% to 15% of the price of a new ship.
Source: wall street journal. 14 August 2016