Slow progress towards more responsible shipbreaking:

Chittagong ship breaking yard (Photo courtesy - Tridib Ghose)

Belgium: The NGO Shipbreaking Platform addressed the shortcomings of the EU's ship dismantling policies - part of the 'Blue Growth Strategy' - at the EU Maritime Day which was hosted last week in Brussels. Current legislation 'does not tackle the real threats to the world's oceans and seas', the group told delegates.

Together with leading environmental and labour rights organisations such as Greenpeace, the World Wide Fund for Nature and the International Transport Workers Federation, the NGO stressed the need for 'a sustainable marine economy'. Besides ship owners using 'flags of convenience', the shipbreaking industry is still battling sub-standard scrapping, pollution and a disregard for ship yard workers' labour rights, noted its executive director Patrizia Heidegger.

She called on the International Maritime Organization, the UNEP/Basel Secretariat and the International Labour Organization to work together on phasing out current beaching practices in South Asia and on helping to develop modern ship recycling facilities off the beach that 'guarantee a clean and safe dismantling of all end-of-life vessels'. Green ship design must also become a reality so hazardous materials no longer end up in ships, Heidegger argued.

'It is shameful that most ship owners continue to reject responsibility for their end-of-life vessels,' she said. While best price is still at the top of the list of priorities for most of them, an increasing number of 'progressive' ship owners are refusing to sell their end-of-life ships to sub-standard beaching yards. The EU Ship Recycling Regulation has set 'a clear standard' for safer practices, Heidegger added. 'So sooner or later, safe and clean ship recycling will be unavoidable for all.'

Source: recycling international.  29 May 2014

http://www.recyclinginternational.com/recycling-news/7937/research-and-legislation/belgium/slow-progress-towards-more-responsible-shipbreaking

INS Vikrant Moves From Naval Dock to Ship Breaking Yard:

Over a month after decommissioned Indian Naval Ship (INS) Vikrant was sold, it was today moved out of the Naval dock and taken to a ship breaking yard in south Mumbai.

"The ship started from the naval dock at 9.40 AM and reached the yard at around 2.30 PM," said a source in the Western Naval Command.

The ship will not be broken for now as a petition seeking that it should be converted into a museum is pending in the Supreme Court, the source said.

"We wanted the ship shifted before the monsoon," he said, adding the vessel could face threat of sinking if moved after the onset of monsoon.

Last month, IB Commercial Pvt Ltd had won the bid for Rs 60 crore to scrap the decommissioned aircraft carrier, which played an important role in the 1971 Indo-Pak war.

Sources in the defence also said that artefacts of the ship have been removed.

"More than 60 per cent of the artefacts have been moved to the Maritime History Society in Mumbai while rest have been shifted to Naval Aviation Museum in Goa," said the source, adding that smaller relics will be shifted to various museums and motivational centres.

Earlier, the Maharashtra government had expressed its inability to maintain Vikrant,

Indian Navy's first aircraft carrier which was commissioned in 1961. It was decommissioned in January 1997.

In January 2014, during the hearing of a PIL which opposed the plan to scrap the ship, the Union Ministry of Defence told the Bombay High Court that it had completed its operational life.

The Maharashtra government had stated that to preserve it as a museum would not be financially viable.

The High Court subsequently dismissed the PIL. Now, the petition is pending in the Supreme Court.

The Majestic-class aircraft carrier, purchased from Britain in 1957, played a key role in enforcing the Naval blockade of East Pakistan during the Indo-Pakistan War of 1971.

Source: outlook india.  28 May 2014

http://news.outlookindia.com/items.aspx?artid=842230

The Hong Kong Convention on ship recycling five years on:

Chittagong ship breaking yard. (Photo courtesy - Tridib Ghose - 2014)

On 15 May 2014, The Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC) enjoyed its fifth anniversary of adoption by the IMO, and it is still on the shelf.

At the time of its adoption, some speculated that it might take three, four or even five years to push through the convention. Now, at the long end of that estimate, the convention has since been ratified by just one of the 15 shipowning and ship scrapping nations it needs to trigger the 24-month timer before it enters into force. The solitary country to ratify is Norway, which it did in June 2013.

It might come as a surprise then that of the 1,213 large ocean going ships sent to the beaches of Pakistan, India and Bangladesh, 238 were beneficially owned by European companies and five of those by Norwegian companies.

Few will be surprised to learn the Greeks top the list with 84 ships, but generally green Germany comes in second with 67 vessels. We are not talking bit-players sweeping rustbuckets under the rug either, industry-leading listed companies with bold corporate social responsibility statements still find their ships running aground on beaches where oxyacetylene cutters await. A recent report by the NGO Shipbreaking Platform said 15 workers had died in South Asian shipbreaking yards this year.

As well as the obvious commercial benefits, a look at the state of regulation within the industry offers some insight into how what many consider one of shipping’s most shameful activities it manages to continue.

After HKC was adopted in May 2009 it become apparent that not only was the international community not about to ratify it, but the convention itself might offer less protection than the existing Basel Convention on the Control of Transboundary Movements of Hazardous Wastes and their Disposal (Basel).

Beaching is noted as a method of recycling within HKC guidelines, although the practicalities of chopping up steel behemoths on beaches with large tides renders it impossible to abide by the convention's environmental and saftey rules.

Concise rules on ship cleaning ahead of recycling are not to be found within the convention and its reporting systems trail behind those of Basel.

Predicting that the HKC would not come into force before 2020, The European Union took steps to address ship scrapping by introducing its own legislation in late 2013 to speed up adoption of HKC and improve on it. The rules build on HKC, adding a list of approved recycling facilities for ships flying EU flags, adding to the list of prohibited materials for newbuildings and introducing an attempt to tackle cash buyers by imposing penalties on previous owners if a ship ends up in the wrong facility.

Not only are the European rules easy to sidestep by re-flagging the vessel to a non-EU flag, the legislation is under heavy fire for itself being illegal as it contradicts areas of Basel which are already of EU law.

Away from being seen by some as a regulatory backwards step and clearly uninspiring to IMO members, there has at last been some progress for HKC.

Within the EU the HKC has seen a number of outbursts of support and even the Council of the European Union has strongly encouraged that member states ratify it, but on 14 April 2014, four years and 11 months after the adoption of the HKC, the EU ruled in Luxembourg that "Member States are hereby authorised to ratify or accede to, for the parts falling under the exclusive competence of the Union, the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, 2009."

Perhaps standard procedure, or perhaps as a sign of confidence in the glacial-paced convention, the European Council will review the ratification’s progress "by 2018."

Source: seatrade global.

http://www.seatrade-global.com/news/asia/the-hong-kong-convention-on-ship-recycling-five-years-on.html

GMS weekly report on Bangladesh ship breaking industry for WEEK 21 of 2014:

Despite the odd sale being reported mainly from vessels discharging in or close to Chittagong waters and able to deliver before the budget of June 5 th most end buyers are choosing to wait and watch market developments rather than offer on candidates and compete with an over-zealous Indian market.

No changes to budget expected. It is not expected that any new tariffs, duties, or taxes will be imposed in the upcoming budget but most buyers, as usual, would rather remain cautious in their offerings and buying in case any undesirable changes come to pass.

The one deal of the week saw the Chinese controlled Panamax bulker DA FU STAR committed for USD 470 per LT LDT for a very prompt end May delivery and beaching, in what is likely the last pre budget sale to be recorded.

Source: steel guru. 27 May 2013

http://www.steelguru.com/indian_news/GMS_weekly_report_on_Bangladesh_ship_breaking_industry_for_WEEK_21/340025.html

GMS weekly report on Indian ship breaking industry for WEEK 21 of 2014:

Another stunning week saw the Indian Rupee trading well below INR 60 against the US Dollar (mostly in and around the mid to low 58s) and gave some much needed confidence to many end buyers to return to the bidding tables once again, in an attempt to fill plots that have largely remained vacant over the recent past.

At the onset, the landslide election victory for Mr Modi has been an incredible source of encouragement that darker days, which started in the Q4 of 2012 with the unprecedented, historic and tumultuous depreciation of the Indian Rupee, were finally behind them.

Indeed, even tankers that may have been considered certainties for the Pakistan market due to cheaper gas free status are now being made gas free for hot works at added cost and brought over to the undisputed market of the moment, to cash in on the premiums on offer.

Two such cases in point will likely see the favored Ukrainian built tanker VALDIVIA (16,248 LDT) brought across from Chile after fetching a huge USD 402/LT LDT (and with significant delivery expenses, particularly on bunkers all the way from South America).

Source: steel guru. 27 May 2013

http://www.steelguru.com/indian_news/GMS_weekly_report_on_Indian_ship_breaking_industry_for_WEEK_21/340016.html

GMS weekly report on Turkey ship breaking industry for WEEK 21 of 2014:

The ongoing limited supply of vessels for recycling in the Med region has resulted in a lack of supply that is driving the tonnage starved market, further up this week. It is evident that end buyers in Aliaga are keen to purchase just about any unit offered into the local market as domestic yards are barely able to cover their operating expenses.

Consequently, even small LDT vessels might achieve levels in the region of USD 330 to USD 340 per LT LDT, depending on the type of the vessel. A few weeks back, such levels were only being offered to units with extra value.

It is estimated that last year, about 1 million LDT was delivered to Turkey, which is equivalent to about 20,000 LDT per week, or about 4 units of 5,000 LDT per week. In comparison, so far in 2014, the total number of units to have hit the shores of Aliaga are estimated to be in the 50s, which translates to only about 2-3 units per week.

As such, end buyers hope that, for the second half of the year, the negative fluctuation of chartering rates (especially for the smaller units that trade in the Med region) will have a positive effect in the supply of tonnage and, as such, more units being delivered to local ship recycling facilities.

Other factors, which are affecting the pricing, ie local steel prices and the currency, improved slightly this week. Nevertheless, it is still under question whether the present market levels in Aliaga would allow local buyers to successfully compete with the Indian sub continent markets or whether a further boost in the prices would be needed.

Source: steel guru. 27 May 2013

http://www.steelguru.com/international_news/GMS_weekly_report_on_Turkey_ship_breaking_industry_for_WEEK_21/340070.html

GMS weekly report on China ship breaking industry for WEEK 21 of 2014:

Marginal signs of an improvement in pricing and sentiment were visible this week perhaps as a result of a slowing in the supply of state owned tonnage and a realization that an improvement will be needed following the election victory in India, to secure any market vessels at all.

Levels though still remain stranded USD 150 per LT LDT below what their sub continent competitors are paying and for even smaller general cargo units positioned in the area, it is gradually making more sense for owners to head elsewhere.

Local scrap markets in the Philippines, Vietnam and Indonesia have been more competitive on the pricing of late than the Chinese market and some serious upwards moves on the price will need to be made in future, to secure any of the international tonnage.  

Source: steel guru. 27 May 2013

http://www.steelguru.com/international_news/GMS_weekly_report_on_China_ship_breaking_industry_for_WEEK_21/340068.html

GMS weekly report on Pakistan ship breaking industry for WEEK 21 of 2014

As the lowest placed Indian sub-continent market at present, it was discouraging for Gadani end buyers to see even their favored tankers head to Indian shores. Yet the demand to acquire new units from domestic yards is almost non existent, due to very real concerns that new taxes or duties may be imposed in the upcoming budgets in early June.

As a result, very few buyers are even offering on new tonnage, simply choosing instead to wait and watch and hope for the best ahead of the budget announcement. Therefore to the disappointment of many and indeed the frustration of cash buyers, several vessels are being diverted to India.

This lack of competitiveness will see Pakistan buyers miss out on a majority of the market units and an improvement would likely be needed after the budget, just to secure vessels once again.

Source: steel guru. 27 May 2013

http://www.steelguru.com/international_news/GMS_weekly_report_on_Pakistan_ship_breaking_industry_for_WEEK_21/340066.html

Locals up in Arms against SILK Ship-breaking Unit:

KANNUR: Thirty years ago when they were children they rushed to the seashore to witness the arrival of a vessel to the ship-breaking yard of Steel Industrials Kerala Ltd (SILK) at Azheekkal, located near the estuary where the Valapattanam river falls into the Arabian Sea, 11 km from here.

Now, as they take part in a relay hunger strike against ship breaking, sitting under a shamiana on the side of the road leading to SILK, they contemplate with a heavy heart how in three decades’ time the yard has shattered their expectations by polluting the earth, air and water.  Speaking to Express on Wednesday, District Collector P Balakiran revealed that the ship- breaking unit didn’t have licences of the Pollution Control Board and the civic body. He  added the SILK management had been asked to obtain the within a week.

The anti-shipbreaking committee has locked horns with the Joint Council of Trade Unions, represented by the CITU, INTUC and the STU. Political parties have declared that they are determined to save SILK, a public sector undertaking that had been making good profit over the last few years after a period of crisis.

But leaders of the strike argue that SILK could be saved even if it stopped ship breaking and undertook other construction projects and continued building and boats and vessels. The unit started ship breaking in 1984 and over the last three decades it has dismantled 30 ships.

International NGO Greenpeace said in 2003 that the ship breaking at Azheekkal was going to be as dangerous as that in the yards at Alang in Gujarat, the world’s largest ship-breaking centre.

SILK officials say all arguments of the action committee were baseless and that the unit started dismantled ships only after obtaining all necessary certificates.

“The Port Department and Customs Department have approved the ship-breaking procedures and we are always vigilant to adhere to environmental protection norms. We will be allowed to break a ship only after the physical examination of these aspects is completed by the port officer,” unit manager P Manoharan said.

He said people affected with diseases like asthma were falsely projected as victims of pollution caused by the ship-breaking unit.

But Shajahan, convener of the committee, said: “The Basel convention of the United Nations and the International Maritime Organisation have issued several guidelines regarding the trans-boundary movement of hazardous waste and its dumping especially in regard to the dismantling of old ships but all such stipulations are totally flouted here. An activity like dumping of hazardous materials should never be carried out in a densely populated area like Azheekkal which has immense ecological significance too. Most of the workers at the ship-breaking unit here are migrant labourers from Gujarat, Bihar, Uttar Pradesh and Odisha who seem to be little aware of the health hazards,” he said. “The living conditions of these workers accommodated amid heaps of hazardous waste are appalling. Moreover, the ships are dismantled not after dragging them to the shore, which is mandatory. All waste is mixed in the river,” said committee chairman M K Manoharan.

Maritime legal expert V M Syam Kumar said though India was not party to any international treaty on ship breaking, the Supreme Court in the Exxon Valdez case had made it clear that the county was bound to follow all norms of the Basel convention. “While dealing with an ownership dispute over a ship brought for dismantling I came to know that the unit in Azheekkal was not following many norms,” he said.

Fisherfolk who say the fish stock in the river and its estuary has become almost nil are the worst-hit. According to them, long prawn, crab and some other fishes unique to the region,  which they used to export have vanished. Many of the fishermen have take up other jobs. “We are disappointed that despite repeated pleas, the government has not yet appointed an expert committee to study the grave issue affecting our livelihood,” said Araya Samajam president K P Madanan. The Azeekkal Boat Owners Association, Valakkar Sangam, Fishermen Health Council and the Kerala Fish Merchants Association have extended support to the stir.

Major health hazards the locals complain about are respiratory problems, skin deceases and eye disorders.

The activists said that asbestos, arsenic, lead, chromium, organotins, dioxins and poly cycleic aromatic hydro carbon compounds that get mixed in river as a result of the ship breaking process can cause everything from itching in the eyes to cancer and genetic disorders. A Kerala Sasthra Sahithya Parishad team which visited Silk said ship breaking could be carried out provided absolute transparency was maintained in the operations.

Though political parties except the BJP, RMP and the SDPI pooh-pooh the arguments of environmentalists, members of almost all parties make their presence felt on the protest front.

Hence, agitators are often seen blocking and questioning people’s representatives and political leaders who drop by to express their “solidarity”. Protesters had laid siege to the unit’s entrance, preventing truck movement.  As the latest rounds of talks with the District Collector turned fruitless, the committee is planning to go ahead with the stir consolidating popular support from various quarters.

Source: new Indian express. 26th May 2014

http://www.newindianexpress.com/states/kerala/Locals-up-in-Arms-against-SILK-Ship-breaking-Unit/2014/05/26/article2245433.ece

With Narendra Modi as PM, ship graveyard in Gujarat hopes to break new ground

At Alang, around 50km off Bhavnagar in Gujarat, the world's biggest graveyard for junk ships is awaiting Narendra Modi's coronation.

Just like the stock market where traders have gone crazy and Sensex has lost the sense of gravity, the thriving market for decommissioned ships has reached the stratosphere and deals are being struck at a premium — mostly over $500 per tonne, more than 30% year-on-year. There is uncertainty over long-term viability of the business and falling steel prices (ships are demolished to make steel plates sold in the secondary market), but a clear NaMo wave is sweeping across the dirty, oily beaches of Alang-Sosiya.

Buoyed by the rupee strengthening and the prospect of higher demand for steel, the multi-billion market is busy striking deals.

At present, around 80 ships are being demolished at Alang's yards. Ship breakers believe that once the NDA government is sworn in, the sector will see a steady improvement in sentiments.

"We are all excited. We look forward to Modi reshaping the Indian economy. India has been undergoing a bad phase," says Nitin Kanakia, a ship breaker and joint secretary of Ship Recycling Industries Association, India (SRIA). According to him, around 60-65 yards, out of a total 138, are working at present. "Prices have shot up from $380-400 per tonne to over $500 in 12 months."

Last week, a container ship Messologi (23,740 tonne), controlled by the Greek shipping giant Danaos, was sold for a firm $515 per tonne, the fourth sale from the group this year, according to a report by GMS, world's largest trader of junk ships. Another ship from Danaos, Mytilini (23,366 tonne) was sold for $509 per tonne two weeks ago. Another Italian owner has committed both their sister ships (roll-on roll-off) Jolly Verde and Jolly Rosso (both 13,696 tonne) 'as is' Jebel Ali, for $500 per tonne, with extra payment for bunker oil.

Similarly, PIL of Singapore has sold container ship Kota Wirawan (6,811 tonne) at $513 per tonne.

Shashank Agrawal, group legal advisor of Singapore-based trader Wirana Shipping Corporation, told dna that rupee is expected to strengthen. "Everyone hopes that steel prices would increase, riding the increasing demand amid an infrastructure push. Demand for old ships will definitely see an increase," says Agrawal.

He also predicted an increase in disputes and court cases related to ownership and posession of ships, and unpaid wages and dues to suppliers.

Kanakia says while the rupee has strengthened, there is no corresponding increase in steel prices in the secondary market. "Prices are ruling at Rs29,500 per tonne, around Rs2,000 more year-on-year," he says, discussing the non-viability of the business in the current scenario.

While ship breakers and cash buyers are eagerly looking forward to a Modi government in New Delhi, a few others have raised concerns as well. "Modi, the chief minister of Gujarat, also holds shipping portfolio.

Under his tenure, governance at Alang has seen a steady decline. For instance, the process of allotting plots on Alang beach has become ad hoc, leading to corrupt practices. Issues related to safety and pollution are still given a go-by. In April, four workers from Odisha were crushed to death at the yard," says Gopal Krishna, convener of NGO Toxics Watch Alliance.

He says global shipping companies have turned Alang into the most polluted beach in the world with the complicity of Gujarat and the central government. "Gautam Adani's group company has proposed to set up a ship recycling yard at Mundra. If the Modi government comes to power, Adani's proposal, which is awaiting a final nod from the environment ministry, will surely get a shot in the arm," he adds.

Source: dna india. 16 May 2014  

http://www.dnaindia.com/mumbai/report-with-narendra-modi-as-pm-ship-graveyard-in-gujarat-hopes-to-break-new-ground-1988715

PRESS RELEASE – BROAD NGO COALITION DENOUNCES EU BLUE GROWTH STRATEGY AT FAIR OCEANS CONFERENCE

Bremen/Brussels, 19 May 2014 – The NGO Shipbreaking Platform has joined a broad coalition of leading environmental and labour rights organisations such as Greenpeace, WWF, German-based BUND and NABU, and the International Transport Workers Federation (ITF) calling on the EU to address the shortcomings of its Blue Growth Strategy. Adopted in 2012 to create a sustainable marine and maritime economy, the NGOs denounce the Strategy for encouraging large-scale industrial development without protecting marine ecosystems or seafarers’ rights [1].

According to the NGOs, the EU’s Blue Growth Strategy does not tackle the real threats to the world’s ocean and seas, such as the rise of water acidification, marine pollution caused by ships and by land-based waste, plundering of fishing grounds, the dangers of aquaculture, deep-sea mining, oil drilling and exploration, and the disregard for labour rights on ships using flags of convenience. The NGOs invited the public to discuss these critical issues at the Fair Oceans Conference organised in Bremen, Germany in the run-up to the European Maritime Day conference, which is held today and tomorrow. The NGOs are also staging several protests in Bremen and elsewhere.

Every year on 20 May, the European Commission invites thousands of stakeholders to the EU Maritime Day, which has become Europe’s largest conference on maritime policy issues. The NGO Shipbreaking Platform held a workshop at the Fair Oceans Conference to raise awareness of the human cost and the environmental pollution caused by substandard shipbreaking. The Platform also took the opportunity to call upon the European Union to set up a financial incentive based upon the polluter pays principle. Such a system should not discriminate between the flags used by ships and thereby make it less attractive for European ship owners to opt for flags of convenience for the last voyage of their ships.

“It is shameful that most ship owners continue to reject responsibility for their end-of-life vessels,” said Patrizia Heidegger, Executive Director of the Brussels-based NGO Shipbreaking Platform. “Still too many ship owners prioritise getting the best price for the ship, and ignore the harm done to workers, local communities and the environment. However, we see more and more progressive ship owners refusing to sell their end-of-life ships to substandard beach breaking yards and the EU Ship Recycling Regulation has set a clear standard for safer practices. Sooner or later, safe and clean ship recycling will be unavoidable for all.”

The Platform called on the international community, in particular the IMO and UNEP/Basel Secretariat and ILO, to work together on phasing out the current beaching method in South Asia and help develop modern ship recycling facilities off the beach that guarantee a clean and safe dismantling of all end-of-life vessels. The IMO must also advance on green ship design so that the use of hazardous materials to build ships is stopped and so that they are constructed in a way that allows for clean and safe recycling.

NOTES

[1] Read the press release of the NGO coalition with the position paper: http://bit.ly/1ncU9Bt

CONTACT

Patrizia Heidegger, Executive Director, NGO Shipbreaking Platform

patrizia@shipbreakingplatform.org

+32 2 609 44 19

Source: shipbreaking platform. 19 May 2014

http://www.shipbreakingplatform.org/press-release-broad-ngo-coalition-denounces-eu-blue-growth-strategy-at-fair-oceans-conference/

PRESS RELEASE – SHIPPING COMPANIES’ DUMPING OF END-OF-LIFE SHIPS CLAIMS AT LEAST 15 LIVES IN SOUTH ASIA IN 2014

At least 15 workers have died so far this year in the shipbreaking yards of Bangladesh and India, where the majority of shipping companies sell their end-of-life ships to be dismantled. The NGO Shipbreaking Platform, a Brussels-based global coalition of environmental, human rights and labour rights organisations working for safer and cleaner ship recycling worldwide, is urging the shipping industry to stop selling their end-of-life ships to the shipbreaking beaches of South Asia and instead demand sustainable and safe ship recycling in modern facilities.

In May, three shipbreaking workers died in Chittagong, Bangladesh, including 40-year-old ship breaker Mohsin who slipped and fell to his death on 17 May while he was working on the “Magdalene”, a ship that used to be owned by the Hamburg-based shipping company Johann M. K. Blumenthal. In another Bangladeshi shipbreaking yard, Amjad Hossen was crushed by a falling steel plate while he was dismantling the “Barbaros G”, a ship that used to be owned by the Turkish company Negmar Denizcilik Yatirim AS. Saidur Rahman died on his way to the hospital after a gas cylinder exploded on the “Kima”, a ship owned by South Korean Sunwoo Merchant Marine Company.

In addition to the fatal accidents, nine workers have been critically injured in Bangladesh,  including serious burns to hands and face. Shaju, Rakib and Babu were severely injured on 6 May in an explosion inside a tank, which took place on the “Shanghai”, a vessel sold to the Bangladesh breakers by the leading shipping company Sammy Ofer (now Zodiac Maritime) based in Monaco.

In the shipbreaking yards of Alang, India, two workers were killed in March while working in Plot 20, owned by Amit Sheth, as reported by the Times of India [2]. In April, four workers were crushed under steel plates that fell from beached end-of-life ships, according to local sources [3].

“The owners of shipbreaking yards in South Asia need to ensure the health and safety of workers, but ship owners  such as Blumenthal, who sell their vessels to substandard facilities and refuse to take responsibility for the safe and clean recycling of their ships, become complicit in these accidents,” says Patrizia Heidegger, Executive Director of the NGO Shipbreaking Platform. “These deaths and injuries are the consequences of these companies wanting to make the biggest profit on the sale of their old ships.”

The Platform has already reported on other major accidents such as the one in April where four shipbreaking workers were killed and another three were critically injured after inhaling carbon dioxide when a gas cylinder exploded in a Chittagong yard [1]. Local people and the workers’ families gathered in protest in front of the yard after the manager locked the gates and prevented them from helping the injured workers. The ship was owned by the Russian containership operator FESCO.

In January, a shipbreaking worker, who used to be a fisherman, was killed by a falling steel plate at Siko Steel, a Bangladeshi shipbreaking yard, whilst dismantling a ship belonging to American President Lines (APL), a company owned by Neptune Orient Lines (NOL), one the world’s major containership owners.

“This long and sad list of fatal accidents and severe injuries shows a clear lack of safety measures in the industry,” says Muhammad Ali Shahin, Bangladesh coordinator of the NGO Shipbreaking Platform. “It shows that the workers are not well trained, their activities are not supervised and they are either not provided with safety gear or no checks are made to ensure that they are actually able to properly use protective equipment. It is very obvious that nobody feels responsible for these men’s lives.”

Sometimes no information is available about these tragic deaths: in April, a shipbreaking worker named Sultan died in the BBC Shipbreaking Yard but nothing is known about the circumstances surrounding his death.

“We only learned about the accident when we found out that the dead worker’s body was to be transported back to his village,” says Muhammad Ali Shahin. “Obviously, the yard owner tried to hide the fatal accident. We could not retrieve any further information – this shows the lack of transparency and accountability of the shipbreaking industry”.

Because of the hazardous substances within the ships’ structure, many more workers contract diseases like asbestosis and cancer and die years later. These occupational diseases remain undocumented.

“Most accidents are avoidable. They happen because no precautions are taken, and no proper infrastructure exists on the beaches”, explains Patrizia Heidegger. “Workers are crushed under falling steel plates as the yard cannot safely operate heavy lifting equipment on the beach. They are burnt or killed in explosions and fires as safety standards for hot work are not enforced and workers do not wear protective gear such as fireproof clothes.”

The NGO Shipbreaking Platform has informed all the ship owners mentioned here about the accidents that occurred on their vessels and has called upon these companies to adopt a sustainable ship recycling policy that will ensure clean and safe ship recycling off the beach. The Platform is waiting for their response.

On the other hand, some ship owners fortunately recognise the dangers of beaching end-of-life ships in South Asian yards. In January, two workers were severely burned in an explosion that occurred in the Bangladeshi yard Kabir Steel on board a beached oil tanker sold for breaking by  the Norwegian company Teekay. The Platform informed Teekay  and the public about the accident. As a result, Teekay’s  director, Ingvild Saether, announced in the newspaper Dagens Naeringsliv that the company will change its recycling practices.

(pictured: workers lying in the Chittagong hospital after an accident in the shipbreaking yards in May 2014 - source: NGO Shipbreaking Platform)

CONTACT

Patrizia Heidegger

Executive Director

NGO Shipbreaking Platform

patrizia@shipbreakingplatform.org

+32 2 6094 419

Muhammad Ali Shahin

Platform coordinator

shahinhelpsgreen@gmail.com

+88 018 1953 5319

Source: shipbreaking platform.

http://www.shipbreakingplatform.org/press-release-shipping-companies-dumping-of-end-of-life-ships-claims-at-least-15-lives-in-south-asia-in-2014/

Ship Scrapping Increases, but in Wrong Trades:

Although the number of vessels being scrapped this year has increased dramatically, and looks set to continue rising, it is having little impact on the current excess of supply over demand where it matters most – in the East-West trades, according to the latest edition of Drewry's 'Container Insight Weekly'.

All of the vessels scrapped so far remain below 6,000 teu, whereas the worst excess is in the sector over 10,000 teu, where most vessels are deployed between Asia and Europe. This means that unwanted ULCVs will continue to be cascaded into other routes, thereby maintaining pressure on freight rates.

Out of the 73 vessels scrapped up to the end of April, only seven were post-Panamax ships between 5,000-5,999 teu, with the rest being below 4,999 teu, which position has changed little since   The average size of vessel demolished over the four month period only reached 2,855 teu, compared to 2,288 teu over the whole of 2013, 1,868 teu in 2012 and 1,293 teu in 2011. In other words, only vessels deployed in fast growing North-South and intra-regional trades are being scrapped, which is not immediately relevant to East-West services.

Moreover, the amount of vessel capacity being scrapped still remains small compared to the total fleet capacity in service. Even if the current rate of scrapping were to be continued over the rest of the year, less than 4% of the world cellular fleet would be scrapped in 2014.

When analysing the subject, the temptation is to simply compare global cargo growth, which is not expected to exceed 5% this year, with global fleet growth, which will probably be somewhere between 5-6%, making this demolition rate look meaningful. For example, a hefty 40% of vessel capacity growth so far this year has been offset by demolitions.

But the comparison overlooks the uneven way that excess vessel capacity is being delivered. just over 50% of all newbuild capacity brought into service since the beginning of 2011 has been provided by vessels over 10,000 teu deployed on East-West routes.  The average provided by vessels below 5,000 teu, where most scrapping has been taking place, is just 17%. Moreover, the capacity of all vessels scrapped last year (i.e. less than 6,000 teu) only more-or-less equated to the newbuild capacity injected by vessels less than 6,000 teu.

The position is not expected to get any better soon, as 55% of all newbuild capacity on order up to the end of 2016 consists of vessels over 10,000 teu, and the world cellular fleet is expected to grow by 20% during the period, ignoring further demolitions and delivery postponements. Although some of the vessels between 6,000 -9,000 teu that they will displace will quickly fit into North-South routes, the majority won’t due to draught restrictions in such places as Africa, India, and South America. Dredging takes time due to environmental considerations alone.

Drewry's View

Current scrapping alone will not be enough to meaningfully address the current imbalance between supply and demand in East-West trades. As long as only ships below 6,000 teu continue to be demolished, North-South trades will be the sole beneficiaries.

Source: marine link. 19 May 2014

http://www.marinelink.com/news/scrapping-trades-moves369403.aspx

GMS weekly report on Turkey ship breaking industry for WEEK 20 of 2014:

The market condition in Turkey remains steady as the demand for tonnage from end buyers continues to persist, driven by a dearth of supply. Additionally, the increasing prices offered from the India sub continent markets are making things increasingly competitive for Turkish buyers, who now have to compete with a price differential of more than USD 120 per tonne for similar units.

Consequently, for owners of vessels 4-5000 LDT (and larger), it is more feasible to ballast their units and divert them towards the sub continent. Presently, it is estimated that only about 10% to 20% of the local yards in Aliaga remain busy while the rest remain relatively inactive due to the diminished supply over the last couple of months.

While steel prices have remained stable, the TRY has depreciated slightly as the week ended, trading at TRL 2.09 against the US Dollar. Thus, it remains to be seen how prices for ships will perform going forward.

Source: Steel Guru. 20 May 2014

http://www.steelprices-china.com/news/index/2014/05/20/NDg0NTI%3D/GMS_weekly_report_on_Turkey_ship_breaking_industry_for_WEEK_20.html

Ship breaking spurts as NaMo wave sweeps Alang:

At Alang, about 50 km off Bhavnagar in west Gujarat on India's west coast, the world's biggest graveyard for junk ships is awaiting NaMo's coronation.

Just like the stock market where traders went crazy and Sensex lost its sense of gravity, the thriving market for decommissioned ships has reached stratosphere, with most deals, being struck at over $500 per tonne, more than 30% premium over year-on-year rates.

There is uncertainty over long-term viability of the business and steel prices (ships are demolished to make steel plates sold in the secondary market), but a NaMo wave sweeping across the dirty, oily beaches of Alang-Sosiya is giving confidence to ship breakers.

Buoyed by the strengthening of rupee and improving the prospect of steel prices in the secondary market, the multi-billion junk ship market is busy striking deals.

At present, around 80 ships are being demolished at Alang's yards. Ship breakers believe that BJP's government will ensure a steady improvement in infrastructure, which, in turn, would help steel prices.

"We are all excited. We look forward to Modi reshaping the Indian economy. The worst is behind us," says Nitin Kanakia, a ship breaker and joint secretary of Ship Recycling Industries Association India.

According to him, around 60-65 yards, out of the total 138, are working at present.

"Prices have shot up from $380-400 per tonne to over $500 in last 12 months," says Kanakia.

Last week, a container ship Messologi (23,740 tonne), controlled by the Greek shipping giant Danaos, was sold for $515 per tonne, the fourth sale from the group this year, according to a report by GMS, world's largest trader of junk ships.

Another ship from Danaos, Mytilini (23,366 tonne), was sold for $509 per tonne two weeks ago. Another Italian owner has committed both their sister ships (roll-on roll-off) Jolly Verde and Jolly Rosso (both 13,696 tonne) available at Jebel Ali, for $500 per tonne, with extra payment for bunker oil.

Similarly, PIL of Singapore has sold container ship Kota Wirawan (6,811 tonne) at $513 per tonne.

Shashank Agrawal, group legal advisor of Singapore-based trader Wirana Shipping Corporation, told dna that the rupee has already strengthened, and it is expected to gain further, with higher dollar inflow. "Everyone hopes that steel prices would increase too, riding the increasing demand amid an infrastructure push. Demand for old ships will definitely see an increase," says Agrawal.

Over last few years, yards in Alang have seen several disputes and court cases related to ownership and possession of ships, and unpaid wages and dues to suppliers. "Going forward, number of such cases will increase," says Agrawal.

Kanakia says while the rupee has strengthened, there is no corresponding increase in steel prices in the secondary market. "Prices are ruling at Rs 29,500 per tonne, just around Rs 2,000 more year on year," he said, discussing the non-viability of the business in the current scenario.

While ship breakers and cash buyers are eagerly looking for the Modi's magic in New Delhi, not everyone is singing praises of Modi.

"During his days in Gujarat, Modi was also holding the shipping portfolio. Under his tenure, governance at Alang had seen a steady decline. For instance, the process of allotting plots on Alang beach had become ad hoc, leading to corrupt practices. Issues related to safety and pollution are still given a go-by. In April, four workers from Odisha were crushed to death at the yard," says Gopal Krishna, convener of NGO Toxics Watch Alliance.

"Over last one decade, Alang has seen more than 200 deaths, making it the worst among industrial disasters," says Krishna, who is fighting several battles for workers' justice.

He says the global shipping companies have turned Alang into the most polluted beach in the world with the complicity of Gujarat and central governments. "Gautam Adani's group company has proposed to set up a ship recycling yard at Mundra. Now that Modi has come to power, Adani's proposal, which is awaiting a final nod from the environment ministry, will soon get a clearance," he adds.

Source: DNA India. 20 May 2014

http://www.dnaindia.com/money/report-ship-breaking-spurts-as-namo-wave-sweeps-alang-1989894