The 5th Annual Asia Ship Recycling & SNP Summit 2013:

July 3rd-4th, 2013 Shanghai, China

SHANGHAI — Global ship scrapping tonnage increased by 8.8% year-on-year in 2012. However, data show that the global scrapping tonnage declined in Q1 2013, and the prices tend to be stabilized after reaching a peak. Where will the ship scrapping market head for in the following three quarters? The fluctuations of steel scrap prices and currency exchange rates put many recyclers in an awkward situation of “increased quantity and increased loss”. Are the steel scrap prices expected to rise in 2013? Greek ship owners are active in the SNP market, buying the Supramax, Handymax and Handy ships in early April. Should other buyers follow suit? How will the SNP market develop in the future?

“The 5th Annual Asia Ship Recycling & SNP Summit 2013” will be held on July 3rd-4th by CBI BIZ, which can be an ideal platform for speaking directly with Chinese ship owners, recyclers and international brokers, cash buyers. The summit will attract more than 150 attendees to gather in Shanghai, to look into market development trends, to learn updated policy status, and to focus on green ship recycling.

As the only conference based on China’s recycling and SNP market, it has already aroused attention in the industry. So far, many industry players, such as Wirana, GMS, Dalian Shipbuilding, ACM, ICAP, Braemar Seascope, China Shipping, Nanjing Ocean Shipping, Zodiac Maritime, TBS, Cosco, Evergreen Marine, Teekay, TSL group, Clipper, Cargill, etc. have already registered to attend this summit.

Special thanks to sponsors of the 5th Annual Asia Ship Recycling & SNP Summit 2013, including Wirana, ClassNK, GMS, Lucion Marine, Sea2Cradle, van de poel | m.a.r.c & WSM.

Highlighted Topics and Speakers

DEMO Price trend: CN Vs. IN

--Keyur J. Dave, CFO, Wirana Shipping Corp.

HK Convention & Offshore Vessels Recycling

--Tom Peter Blankestijn, Managing Director, Sea2Cradle

Ship Recycling Facility Plan

--Toshitomo Matsui, Executive Vice President, ClassNK

--Junichi Hirata, Manager, Practical R&D Promotion Division, Ship Recycling Team, Chairman ACS Shiprecycling WG, ClassNK

EU’s New Ship Recycling Proposal

--Philip Rozier, Director, Lucion Marine

HazMat and Waste Management

--Zeng Jianbing, Chief Engineer, Ship-recycling & Hazmat Consultant, van de poel | m.a.r.c

Scrapping Yards’ Downstream Remanufacturing, Steel Scrap Sales Channels and Trade Flows

--Yan Qiping, Former Secretary-general of China Association of Metal Scrap Utilization

India’s Steel Scrap Market

--Asif Rahman, Projects Broker, ICAP Shipping Tankers Pte Ltd.

China’s Steel Scrap Market

--Zhang Hao, Analyst, Fubao

Outlook for SNP Market

--George Eliades, Head of Sale & Purchase China, ACM Shipping China

Outlook for New-building Market

--Pierre Pochard, Senior Market Analyst, DNV

Ship Financing

--Shanghai Chonghe Financial Leasing Co., Ltd. (TBC)

Source:Herald Online. 30 May 2013

http://www.heraldonline.com/2013/05/30/4902630/the-5th-annual-asia-ship-recycling.html

Ship Recycling Conference, London, 2013

The SSI Closed Loop Materials Management workstream has been invited to speak at the Ship Recycling conference in London on 26-27th September.

The 8th annual Ship Recycling Conference is the place to be to receive the latest updates on the big financial, commercial, environmental and regulatory issues facing the industry including how to best plan and prepare for the regulatory, operational & practical implications of managing hazardous materials.

Link to the conference website:
http://www.informamaritimeevents.com/FKT2547RBB

Source: Sustainable Shipping Initiative.

http://ssi2040.org/events/1717/

GMS weekly report on India ship breaking industry for WEEK 21 of 2013:

The Indian market endured another highly turbulent week, which bv the close had seen steel prices come off bv almost USD 15-20/LT LDT and saw the Indian Rupee tumbling down and trading at a near-historical low for the year at INR 55.65 to the US Dollar.

Whilst the local steel plate prices have been particularly volatile of late, the latest news regarding the currency will certainly knock end buyers back particularly given the multitude of high priced deals done and the fact that, as it stands, all end buyers are currently losing significant money on their recent fixtures.

Indeed, the pressure started to tell on certain cash buyers as well, as vet more deals started to stall - facing either renegotiations or failure altogether. Following the failed deal of the Turkish owned handy size bulker SUR (6/170 LDT) last week, the MPP LUGANO (9,055 LDT) was also put back on the market after failing to one buyer at region LJSD 435/LT LDT.

It may be that end buyers and cash buyers would rather see some stability in the market and focus on delivering existing high priced inventories, rather than plug ahead with new deals particularly with many owners seemingly intent on asking the previous week's prices.

Source: steel guru.  28 May 2013

http://www.steelguru.com/indian_news/GMS_weekly_report_on_India_ship_breaking_industry_for_WEEK_21/313404.html

GMS weekly report on Bangladesh ship breaking industry for WEEK 21 of 2013:

A drop in sentiment and interest to buy has coincided with falling local steel plate prices and the upcoming budget. Very few enquiries to buy have been emerging over this time and it appears that most end buyers are content to digest what vessels they have on their plots, before seeing what the budget of June 6th has to offer.

There was one interesting potential sale for the week as the HMM owned VLCC UNIVERSAL HOPE (40,970 LDT) reportedly found a buyer at a massive USD 435/LT LDT 'as is' Ningbo, North China with approximately 1,200 T bunkers remaining on board at the time of delivery.

Owners were to deliver the vessel "gas free for hot works clean" in Julv, but owing to weakening sentiment across all recycling markets (and few positive signs of imminent recovery on the horizon), there are some doubts as to whether she was concluded to a demo buyer at all (unless the concerned party is intending on taking an extreme gamble, given the fixing price).

In light of this, perhaps a Chinese trading / storage buyer picked her up at demo related levels (surveys are not due for several years vet). It will be worth keeping a keen eve on this deal in the coming weeks as the true story on the sale emerges.

Source: steel guru.  28 May 2013

http://www.steelguru.com/indian_news/GMS_weekly_report_on_Bangladesh_ship_breaking_industry_for_WEEK_21/313406.html

Study Report- Rural-Urban Migration in Ship Breaking Industry:

A Case of World's Largest Ship Breaking Yard  

 

Blurb:

Migration is as old as human history. The massive movement of population of the modern time has wide social, economic, political, demographic and economic implications. Migration process has been analysed by a number of ways. Generally, it means the settlement or shifting of an individual or a group of individuals from one area i.e. origin to another area i.e. destination. Migration from rural to urban areas is considered as universal phenomena which accompanies economic development. The researcher tries to provide a brief and comprehensive of the important aspects and dimensions of internal migrations. It provides some conceptual introduction to the subject, examines the causes, correlates and consequences of migration and reviews important trends in migration and also put forward policy measures. The study is based on the primary collection at Alang ship breaking yard near Bhavnagar Gujarat. The survey covered 300 respondents. The researcher visited the respondents place of work and at their living place to collect data. This study is one of the unique study because ship breaking industry comes under the organized sector but labours are unorganized in various ways.

Author: Hrudanand Misra

Number of pages: 128 

Published on: 2011-10-15 

Source: https://www.lap-publishing.com/catalog/details/store/gb/book/978-3-8465-1666-9/rural-urban-migration-in-ship-breaking-industry

Save the Date: Opening of the exhibition “Chittagong Blues & The shipbreakers”

Date & Time: Wednesday 29 May 2013 – from 6 :00PM

Venue: Edelman | The Centre, Avenue Marnix 22, 1000 Brussels (on Avenue des Arts, a 2-minute walk from metro stop “Trône”)

You are cordially invited to attend the opening of the exhibition “Chittagong Blues & The shipbreakers” on Wednesday 29th May. The exhibition will feature, for the first time in Belgium, the artistic work of German sculptress Nele Ströbel, who travelled to one of the world’s biggest graveyards of ships in Chittagong, on the south-eastern coast of Bangladesh.

Her impressions are captured in sculptures made of terracotta and various metal pieces she found in the shipbreaking yards. Her experiences on the ground also inspired ink drawings and a photo-video loop. The artist will be present during the event.

Moreover, the exhibition will feature the striking pictures which French photographer Pierre Torset has taken in the shipbreaking yards of Chittagong.

We will use the opening event to further explore the question of shipowners’ responsibility for clean and safe shiprecycling and their role in a solution of the global shipbreaking crisis.

Source: shipbreakingplatform

http://www.shipbreakingplatform.org/save-the-date-opening-of-the-exhibition-chittagong-blues-the-shipbreakers/

Controversial Shipbreaking Methods In South Asia Are Cause for Alarm:

There are serious concerns about how the shipping industry is disposing of its toxic waste during the process of shipbreaking: the way an old ship is disposed of, being broken up for scrap recycling. Most vessels have a lifespan of a few decades before they need to be retired; beaching is the most commonly used method to do this, as it is employed by 95 per cent of shipbreaking yards. Beaching is the deliberate crashing of a vessel onto a beach so that it can be dismantled during low tide. However, this method is the most controversial way to dismantle old ships because of its overall lack of containment of toxic waste. Unfortunately, it also is the most commonly used method in South Asia. Here workers break up giant vessels by hand, often leading to deaths, injuries, explosions and chemical spillages, as well as contamination of the beaches and waters around the breaking yards and destruction of coastal mangrove forests.

Now, thankfully, the process of dismantling end-of-life vessels is under scrutiny in this region. The lack of enforcement of environmental and safety legislations along with low labour costs, including poor working conditions, child labour and environmental damage is under criticism by regulators and pressure groups. Today, three countries monopolise global shipbreaking activities: Pakistan, India and, most notably, Bangladesh. In Bangladesh, the shipbreaking industry is highly competitive. According to the World Bank, Bangladesh alone is expected to have 79,000 tonnes of asbestos and 240,000 tonnes of cancer-causing polychlorinated biphenyls (PCB) chemicals "dumped" on it by rich country's ships in the next 20 years.

In Turkey and China, there are somewhat more stringent environmental and safety regulations; those countries account for approximately 25 per cent of shipbreaking activities. Europe and North America follow the strictest social and environmental regulations, using the most sustainable methods. Yet their capacity is underutilized as profit margins for ship owners are higher if the vessel is sold to a developing country.

Meanwhile, the European Parliament will begin to impose penalties on European Union ship owners who send their vessels for dismantling in the developing world, reflecting its toughening stance on contentious shipbreaking activities. Pressure from stakeholders is increasing, resulting in reputational risks for companies. Banks that have financed controversial shipbreaking actions have now also been become targets. Some companies have already committed to ending beaching and adopting best practices, but the vast majority continue to send their end-of-life vessels to South Asia to be dismantled using these provocative methods.

These regulations and action might not be enough to stop shipbreaking in south Asia because in these developing countries it is regarded as a lucrative industry, supplying a substantial quantity of scrap steel for their iron and steel industries, where nearly every part of the ship is recycled.  At the end of the day, it all comes down to money.

Source: justmeans. 23 May 2013

http://www.justmeans.com/Controversial-Shipbreaking-Methods-In-South-Asia-Are-Cause-for-Alarm/59475.html

GMS weekly report on Pakistan ship breaking industry for WEEK 20 of 2013:

There were few chances to import vessels pre-budget into Pakistan. As a result, the number of deals being negotiating (and concluded) were fairly limited.

The Pakistan budget takes place on June 10th and many buyers are now content to wait and watch the results of, before committing on new tonnage - in case any new taxes or import duties are imposed.

The change in leadership has also caused a shift in focus away from the ship-recycling sector as many eagerly anticipate new policies or plans that may come into effect.

There remains keen buying interest for the right types of vessels - larger bulkers and tankers (even bulkers converted from tankers which seem to be finding fewer cargoes today owing to limitations on cargo tank capacity) - though there seem to be fewer vessels in circulation compared to several weeks ago.

One interesting sale was concluded however, as Turkish owners continued their clear-out of older vessels, with the sale of the TURKUAZ 8 (7,140 LDT) for a firm USD 430/LT LDT.

Source: steel guru. 22 May 2013

http://www.steelguru.com/middle_east_news/GMS_weekly_report_on_Pakistan_ship_breaking_industry_for_WEEK_20/312824.html

GMS weekly report on Bangladesh ship breaking industry for WEEK 20 of 2013:

As Bangladesh had to deal with yet another disaster natural this time rather than manmade attentions shifted away from the ship recycling sector and the acquisition of new vessels.

After the recent catastrophic factory collapse and riots, protests and strikes that have gripped the country, tropical cyclone Mahasen, which swept through the country mid week to leave scores dead, was another disaster to rock Bangladesh.

Overall, the ship recycling sector has remained fairly subdued for some time now, with sporadic buying at overall lower levels, proving no competition for rival Indian and Pakistani buyers.

With the upcoming budget just around the corner and monsoon season also imminent, sentiment and price may only get worse before they get better.

The smaller bulker SILVER WAVE from Greek owners was committed this week for USD 410 per LT LDT.

Source: steel guru. 22 May 2013

http://www.steelguru.com/indian_news/GMS_weekly_report_on_Bangladesh_ship_breaking_industry_for_WEEK_20/312816.html

GMS weekly report on Indian ship breaking industry for WEEK 20 of 2013:

As the India market veered from one extreme to the next the currency is now trading above INR 55 to the U.S Dollar once again deals continued to be done at some crazy levels, leaving many under threat of renegotiation or failing altogether.

One deal that was committed and put back on the market was the SUR from Turkish owners, originally done at USD 421 per LT LDT last week but resold this week at USD 419 per LT LDT after the initial deal failed due to some over eagerness from original buyers on the price.

The BOW CHEETAH from Odfjell was sold for green recycling at levels region USD 465 per LT LDT with about 70 tonne of stainless steel on board boosting up the price.

DANAOS sold their third container this year with the sale of the MV ELBE for USD 459 per LT LDT + inward clearance for Buyer’s account, with the MPP LUGANO fetching about USD 425 per LT LDT for an India delivery.

Lastly, general cargo MV AMIRA NADIA from Egyptian owners was reportedly sold at a seemingly aggressive USD 415 per LT. Being relatively small LDT and Romanian built, it was one of the eager purchases of the week.

Many buyers either having purchased vessels recently or noting the extreme fluctuations in both currency and steel prices seem to have decided to stay away from the aggressive buying as monsoon season approaches. It may be that a critical breaking point in the year has been reached in India, which will be worth keeping an eye on.

Source: steel guru. 22 May 2013

http://www.steelguru.com/indian_news/GMS_weekly_report_on_Indian_ship_breaking_industry_for_WEEK_20/312812.html

GMS weekly report on China ship breaking industry for WEEK 20 of 2013:

A week of empty offers was largely down to the fewer candidates being proposed into the local market, as owners on all sizes and types of tonnage looked elsewhere to conclude their deals.

Offers have been so poor or late - in the 350s/LT LDT and often below for smaller sized tonnage - that most owners are now seriously considering the voyage to the Indian sub-continent (preferably Bangladesh due to proximity).

It remains to be seen how much longer this lull in activity will last in China, but with monsoon season just around the comer (and a traditional third quarter softening in levels often seen in the sub-continent as a result), many will be hoping a return to form happens sooner rather than later.

Source: steel guru. 22 May 2013

http://www.steelguru.com/chinese_news/GMS_weekly_report_on_China_ship_breaking_industry_for_WEEK_20/312839.html

British Aircraft Carrier HMS Ark Royal Heads For Scrap Yard:

The people of Portsmouth, England, on Monday turned out to bid farewell to the aircraft carrier HMS Ark Royal, destined for a Turkish scrap yard after its decommissioning two years ago.

The Invincible class carrier was a victim of a 2010 defense review that recommended scrapping the vessel and selling its Harrier jump jets (they were subsequently sold to the U.S.). Ark Royal's sister ship, HMS Illustrious, is due to be decommissioned next year, and a new class of British carrier, designed to launch and recover the F-35 joint strike aircraft, won't come into service for nearly a decade.

The Daily Mail offers a bit of history on the vessel:

"HMS Ark Royal led UK naval forces during the invasion of Iraq in 2003 and saw active service in Bosnia. The Invincible-class aircraft carrier was built by Swan Hunters in 1981 on the River Tyne and was named by Queen Elizabeth.

"Nearly 30 years later, the government then axed the famous warship in the 2010 Strategic Defense and Security Review. It is the most expensive warship built in the United Kingdom, costing a staggering £320million.

"There had been hopes HMS Ark Royal could be preserved as a museum ship, but the Ministry of Defense said she was in too poor a condition.

"Other proposals to reuse the ship included turning her into a commercial heliport, nightclub, school, or a casino."

Source: by Scott Neuman. 20 May 2013

http://www.npr.org/blogs/thetwo-way/2013/05/20/185578507/british-aircraft-carrier-hms-ark-royal-heads-for-scrap-yard

Ship Recycling Developments:

While ship recycling topic suggests the end of life cycle of ships, it is in fact related to the whole life cycle of the ship. Some aspects to be considered in ship recycling are the legislative background, practical experience gained and the risks that stakeholders might face.

When talking about conventions for ship recycling, we might ask ourselves why a convention is necessary. Most of us have probably seen the pictures of ship recycling facilities in South Asia, where people are walking in mud barefooted, in actually inacceptable conditions. There are actual reports of the health and safety conditions of these facilities and they could be described as "hell on earth", so the footages are not lying. On the other hand, there is an increasing public awareness nowadays and no practicable international legislation so far. Therefore, something must be done about ship recycling.

There is of course, the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, developed in 2009, but unfortunately not yet entered into force, as only five countries have signed it and with yet no ratification at all. But hopefully, there might be a step forward in the future. Hong Kong Convention is applicable to all merchant ships above 500GT and to all ship recycling facilities. The key issues of the Convention are Inventory of Hazardous Materials and Authorization of Ship Recycling Facilities. The Convention contains a guideline for the development of Inventory of Hazardous Materials (IHM) and guidelines for safe and environmentally sound ship recycling.

The IHM is a Documentation of Hazardous Materials possibly on board of ships. For the preparation of an IHM, there are different methods for new buildings and existing ships. With the Hong Kong Convention not being in force yet, we are in fact mostly working according to the requirements for existing ships. There are three different IHM parts, whereby Part I of the IHM is most important as it deals with the ship in operation and from that we are dealing mostly with Hazardous Materials displayed in the table, mainly with asbestos.

There are mainly three reasons for preparation of IHMs. For new ship buildings, they are prepared according to requirements for existing ships, as the shipyard wants to be compliant with contractual requirements of ship owner. On the other side, the ship owner can claim rework before ship's delivery from the ship, for example if the owner orders an asbestos free ship. The IHM for existing ships are being prepared in compliance with requirements of environmental labels such as the German 'Blauer Engel'. The ship owner can also claim rework during warranty period of the ship. Last, there are IHM for ships to be delivered to Ship Recycling Facility, which are quite rare actually; in the circumstance IMO-compliant green recycling is being asked.



Steps of preparation of IHM for Existing Ships

As for IHM for new ships according to the Hong Kong Convention, the shipyard is to prepare the IHM, based on information delivered by suppliers in form of Suppliers Declaration of Conformity (SDoC) and Material Declaration (MD), for each product. This as you can imagine, is a very time consuming process and not yet in the suppliers agenda. On the other hand, an IHM for existing ship is to be prepared by the shipowner, therefore a "Hazardous Material Expert" is involved.

The ship recycling facilities require obviously occupational health and safety, people involved need to be trained, and have to use Personal Protective Equipment (PPE). The ship recycling yard must be able to handle Hazardous Materials (HazMats) in a safe way and store them in disposal facilities. The IHM is there to match ship and ship recycling facility and is obviously important for detailed planning of the ship recycling.

As the Hong Kong Convention is not in force yet and probably not be for several years to come, the EU started to draft their own proposal for a regulation of the European Parliament and of the Council on ship recycling. The Draft report contains a ship recycling plan for all EU ships going for recycling and an inventory of hazardous materials for all ships calling at EU ports. Something that was heavily discussed recently was a financial mechanism to finance environmentally sound ship recycling.

From my own experience, most people are concerned about asbestos. There are indeed regions were asbestos is banned, but not as much as desired as shown in the picture below. Asbestos is still being or has been used in about 3.500 products, so new buildings often still do contain Asbestos

The areas where asbestos is usually found can be quite extent.  If you have to exchange that, it will most probably be very costly for the stakeholders.

The challenges involved in ship recycling come from the globalization of supply chains, as banned materials are still used in shipping industry and asbestos is not banned in many countries. Another important issue for ship owners is that Port State Control in Australia and Netherlands may lead to detentions and penalties. In case inspections made on board result in finding Hazardous Materials, this could bring financial implications and difficulties to find new charterers.

The shipowner therefore, has highest risks as he owns the ship for a long period of time and lacks of control of suppliers of shipbuilder. However, the ship owner is also the decision maker and can change industry as a client of shipyards, suppliers and classification societies. The best thing to properly deal with the mentioned risks and dangers is to conduct inspections and samplings for identification of wrong declarations and control of new ships prior to delivery from the shipyard. Ship Recycling is actually not only for old ships, it´s from cradle to grave!

Source: safety4sea. 15 May 2013

http://www.safety4sea.com/analysis/123/191/ship-recycling-developments