Ship recycling is continuing to grow at a fast pace as the worldwide shipping industry struggles against some of the toughest times it has ever faced.
The current amount of capsize tonnage on order for 2011 has been put at around 103.2m deadweight and it is estimated that in excess of 25m dwt for scrapping will have ended up on the beaches of India, Bangladesh and Pakistan by the end of this year.
This is one measure of the rate of scrapping contained in a comprehensive review of ship recycling in the Indian subcontinent and beyond which appears in the current issue of Currents, the magazine published twice a year by the American P & I Club.
Shashank Agrawal, legal advisor at Wirana Shipping Corporation in Singapore
Wirana purchases vessels on the basis of 100% cash and then sells them to a recycler in any one of the ship recycling countries. For vessels purchased ‘as is’ the cash buyer takes over the ship at the delivery port and then boards its own crew to sail the vessel. Meanwhile, the vessel is reflagged, given a new name and provided with fresh insurance cover for the voyage to the recycling yard.
Mr Agrawal states: “Therefore, Wirana is rightly referred to as an underwriter of recycling market risks. Due to fluctuations in steel prices in an extremely volatile market, the owners/sellers could stand to lose millions of dollars by the time the vessel arrives at the delivery port. Irrespective of market conditions, the principles of Wirana have steadfastly stood by owners and sellers.”
The author also describes in detail the legal situation as it affects ship recycling in India , Bangladesh and Pakistan
The second part of this detailed survey of ship recycling will appear in the spring 2012 edition of Currents.
Source: ship management international. 14 December 2011
http://www.shipmanagementinternational.com/2011/12/ship-recycling-continues-to-grow/
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