U.S. Congressman Introduces Ship Recycling Bill:

U.S. Congressman Garret Graves (R – South Louisiana) has introduced the Ships to Be Recycled in the States (STORIS) Act in the U.S. House of Representatives. The bill aims to reform the domestic marine recycling industry.

The legislation would strengthen oversight of the Maritime Administration’s (MARAD) domestic ship recycling program and promote transparency by requiring reports from the agency and an audit by the Government Accountability Office. MARAD receives millions of dollars in federal funding but does not disclose how the money is spent or how the agency awards contracts.

“Americans expect the federal government to operate in their best interest,” said Graves. “We have found multiple instances where the U.S. Maritime Administration has failed to maximize the return on investment on the sale of retired federal vessels by not accepting the highest bid on a number of contracts and not fulfilling its obligation to reinvest these funds in our merchant mariner workforce.”

Current law requires excess government vessels to be sold to and dismantled by domestic marine recyclers. Under current law, federal and state maritime academies and the maritime heritage grant program are supposed to benefit from domestic marine recycling. To date, MARAD has not met its funding obligation, says Graves. The STORIS Act would ensure that returns on taxpayer dollars are maximized by increasing MARAD’s accountability to Congress with respect to its marine recycling program.

The legislation also creates jobs by allowing vessels that can be dismantled in compliance with U.S. environmental and safety laws to be done in the U.S. instead of being exported to countries where safety rules do not apply.

“This bill will prevent MARAD from leaving millions of dollars on the table in regard to ship recycling contracts and require that we have the workforce we need to increase global trade and exports from Louisiana,” added Graves.

The STORIS Act gets its name from the former Coast Guard Cutter Storis, which was dismantled in Mexico in 2013 in violation of the current law. Congressman Graves has been working with Senator David Vitter (R – LA) on the companion bill already introduced in the Senate. Joining Graves as original co-sponsors of the House bill are Reps. Duncan Hunter (R – CA) and Filemon Vela (D – TX).

Source: maritime-executive. 25 June 2015

http://maritime-executive.com/article/us-congressman-introduces-ship-recycling-bill

Beaching Ban Bad for Ship Recycling Industry:

On Monday 20th of April 2015, Michael Grey of Lloyds List published the article "Name-calling bullies" where he outlined his opposition to the idea of banning beaching and gave reasons why such a decision would be impractical and unethical for the ship recycling industry.

In fact, throughout his article he stressed the improvements of safety and environmental standards which have taken place in facilities in the Indian subcontinent and highlighted the fact that these improvements had been witnessed during a fact-finding visit to Alang, India, by a delegation of Japanese industry and government officials organised by GMS. To quote the article directly:

"The visit, which was organised by the cash buyer Global Marketing Systems, was able to see the improvements that were being made and which could be more widely spread around the whole subcontinental recycling sector.”

In his article there are few other arguments worth highlighting, including that if the decision is taken to ban beaching, there would be a limited capacity of yards to carry out recycling; IMO's efforts through the Hong Kong Convention to promote the safe and environmentally sound recycling of ships; and the 40,000 jobs associated with the industry of ship recycling in the Indian subcontinent.

On the 1st of May 2015, Adam Corbett wrote in TradeWinds (Volume 26 / Number 17) that "Belgium opposes the Brussels ban on beach scrapping.” Throughout his article similar opinions as the aforementioned one were expressed.

It is evident that the industry has already taken notice not only of the developments which have taken place in ship recycling facilities which practice environmentally sound beaching methods, but also of the necessity of such facilities to not be excluded from the EU regulation around ship recycling.

The Rising Standards of the Indian Subcontinent

With the raising of ship recycling standards in the Indian subcontinent spreading, and key players in the industry becoming aware of these improvements in the region, the resistance to the European Commission’s (EC’s) possible ban on beaching is steadily increasing.

Consequently, Corbett states that "In a letter to Karmenu Vella, European Commissioner for Maritime Affairs and Fisheries, Belgian Environment Minister, Celine Fremault, said she was keen to see that bad practices in beaching are stopped, but explained that it would be outside the scope of the SSR (Ship Recycling Regulation) to implicitly ban one method of demolition."

The tide seems to be turning against those who are opposed to beaching without being willing to witness the facts for themselves. It is evident that there are facilities capable of complying with internationally acceptable standards and regulations in the Indian subcontinent, and this seems to be increasingly recognised as highlighted by Celine Fremault’s statement quoted by Corbett as follows:

"We would like to formally request that all ship recycling facilities in third countries will be assessed individually, based on the requirements of the regulation and guidance in line with the regulation, taking into account the specifics of the recycling state and recycling method used."

“Alang is not just Alang”

GMS, in coordination with a Danish Shipowner arranged for a study visit by vetting of ship recycling facilities in Alang. The visit which took place in April 2015, included representatives from the Danish Shipowners' Association (DSA) who witnessed the ship recycling practices which are actually taking place locally.

Following up to this study visit, the Director of the DSA, Mrs Maria Bruun Skipper, wrote that "Alang is not just Alang" from which it was acknowledged that some of the yards have "undergone a positive development in order to comply with the requirements that will be set by the forthcoming Hong Kong Convention". Going into more detail, Skipper highlighted in her article that:

"We consequently saw, among other things, workers wearing safety equipment and undergoing six-monthly routine medical check-ups. We also noted that the shipyards were engaged in operations such as asbestos handling, and regularly compiled reports from water and soil pollution tests etc. Finally, we were able to personally observe that three of the shipyards had laid a concrete base beneath the beach to stop seepage of harmful substances."

Having witnessed the facts in Alang, it appears that the DSA has recognized the need for ratification of the Hong Kong Convention, and the necessity for the European Union to be cautious from excluding a place such as Alang because of the bad reputation historically.

Finally, it was worth highlighting that those who have visited Alang, have immediately changed their (negative) views, and this is also evident in the DSA statement, “Our visit was just one visit, but also an eye-opener that ’Alang is not just Alang”.

For more information about the DSA visit and rest of the comments please visit https://www.shipowners.dk/en/presse/nyheder/alang-is-not-just-alang/

European Commission Officials Need To Visit Improved Alang Yards

GMS would like to draw your attention to Corbett's statement that "The EC is yet to visit breaking yards that have made significant improvements". With that in mind, it would be encouraging to see the EU and India coordinating a direct dialogue for a fact finding mission aiming to promote cooperation and awareness, as was recently conducted between India and Japan. Of course, GMS would be willing to facilitate such a delegation at any time.

GMS and Responsible Recycling

GMS has the expertise and resources to guide owners regarding the quality of various yards in different countries, including Turkey, China and India. GMS has been actively trying to promote responsible ship recycling practices for a long time. It is therefore to our satisfaction to see that the industry is taking notice of the need to work jointly, towards encouraging continuous developments, especially when it comes to environmentally sound and friendly recycling practices. One of the best ways to achieve this is by rewarding facilities which are setting high Corporate Social Responsibility standards.

Source: marine link. 15 June 2015

http://www.marinelink.com/news/recycling-beaching392960.aspx

China extends deadline on ship scrapping and newbuilding subsidy scheme

China has extended a scrap-and-build policy due to be expired in 2015 by two years to 2017, according to the ministry of transport.

In a short statement announced on Tuesday, the ministry said the policy has been extended to 31 December 2017, while the content of the policy remains unchanged.

In late 2013, Beijing revealed this scrap-and-build policy to subsidise owners who demolish their older vessels before their operational expiry dates, and to build new, more energy efficient ships as a replacement.

The policy was initially set to run until the end of this year. A few state-owned shipping conglomerates such as China Cosco, China Shipping Development Co (CSDC) and China Shipping Group have benefitted from receiving the subsidies.

In March this year, Gao Yanming, chairman of Hebei Ocean Shipping Co (Hosco) Group, had urged the government to extend for policy deadline to end-2018, so as to prevent owners from adding on to the tonnage supply.

The scrap-and-build policy states that a two-tranch subsidiy scheme will be given to owners with the first tranch dished out upon completing the demolition of an elderly vessel. The second tranch will be handed out after an order confirmation for a new replacement vessel.

Gao had said that while the subsidy end date for the ship demolition would work, the subsidy deadline for firming a newbuilding order will only serve to magnify the existing oversupply problem.

The Beijing policy offers subsidy of RMB750 ($120) per gross tonne for the recycled ship, and the same level of subsidy will apply for the replacement newbuilding that must be built at Chinese yards.

The policy states that the total tonnage of the newly ordered ships should not be less than the total tonnage of the vessels scrapped. Shipowners can choose to tabulate their tonnage based on a cumulative basis from all the scrapped vessels and newbuildings or on a one-for-one basis.

Source: seatrade-maritime. 23 June 2015

http://www.seatrade-maritime.com/news/asia/china-extends-deadline-on-ship-scrapping-and-newbuilding-subsidy-scheme.html

Ship recycling market winds down:

Enterprises Shipping & Trading’s bulker Miden Max was sold for a very firm USD3.82 million or USD385/ldt. Photo: Gary McLeod/IHS   

Ship recycling sales slowed from 15 to 19 June as the monsoon season and Ramadan take their toll on the market.

In addition, brokers suggested that with the recent rebound in dry bulk freight rates, owners might be less willing to scrap ships.

The Baltic Dry Index's drop to an all-time low in February precipitated a deluge in bulkers being sold for scrap, resulting in scrap prices falling from USD400/ldt a year ago to about USD360/ldt today.

In Bangladesh, many yards are well-stocked with inventory and are in no hurry to acquire ships.

Steel prices have fallen during the last few weeks and owing to continuous monsoon rains and shorter working hours due to Ramadan, local yards have not been able to work fast at demolishing ships.

Kaili Shipping, however, managed to sell 1983-built Handymax bulker Kai Hong for USD3.01 million or USD360/ldt.

  

In India, falling steel prices made local yards hesitant to commit to tonnage, although Hong Sheng Da Shipmanagement's 1984-built log carrier Xing An Da was sold for USD2.49 million or a decent USD370/ldt.

In Pakistan, the sale of Enterprises Shipping & Trading's 1993-built Panamax bulker Miden Max bucked the trend when it was sold for a very firm USD3.82 million or USD385/ldt, as it had 200 tonnes of leftover bunkers.

However, Dubai-based cash buyer Global Marketing Systems (GMS) doubted that the transaction would be executed.

GMS said, "In this current market climate, there is of course no guarantee that the deal will be performed and it does seem to be a curiously strong price - albeit one that has an India option attached as well.

"Until the huge number of vessels on plots starts to subside and some clarity on the budget is seen, it is not worth expecting much from the Pakistani market at present, and this may remain the case over the course of the summer/monsoon months."

Source: IHS Marine. 23 June 2015

http://www.ihsmaritime360.com/article/18360/ship-recycling-market-winds-down

Platform News - NGO Shipbreaking Platform presents its Annual Report 2014

Brussels, 22 June 2015 – The NGO Shipbreaking Platform, a global coalition of environmental, human rights and labour rights organisations working to promote safe and clean ship recycling worldwide, presents its Annual Report 2014.

You are invited to find out more in our report including:

a summary of the Platform’s findings about global shipbreaking trends in 2014, statistics on the total number of ships dismantled in 2014, when 62.5% of all end-of-life ships from all over the world were broken in South Asia (India: 309 ships or 30%; Bangladesh: 222 ships or 22%; and Pakistan: 110 ships or 10.5%);

our activities and campaigns in 2014: the Platform’s Annual General Meeting in Brussels; our European campaign to ensure that European policy makers find sustainable solutions to the current shipbreaking crisis; our corporate campaign led with progressive shipping companies, cargo owners and ship recyclers who commit to responsible recycling practices; our international campaign; and our South Asian campaign in the shipbreaking countries, where the Platform and its member organisations advocate for regulation and action to stop illegal imports of toxic ships and the implementation of existing legislation to protect the workers and the environment; and

a presentation of our new partner organisations, and the changes to the Platform's Board structure and the secretariat.

http://www.shipbreakingplatform.org/shipbrea_wp2011/wp-content/uploads/2015/06/NGO-Shipbreaking-Platform-Annual-Report-2014.pdf

Download the Platform’s Annual Report 2014 by clicking on the link above, or send us an email if you prefer to order a hard copy.

CONTACT US:

Delphine Reuter

Communications officer

delphine@shipbreakingplatform.org

Ship owners are turning to scrap market to cover expenses

Research analyst, Vassilis Logothetis looks at the latest dry bulk market situation and how ship owners are handling it in this week's Intermodal report

For some time now the dry bulk market has been severely affected by China’s slowing GDP growth rate that occurs in the background of increased supply of dry bulk tonnage.

Daily rates for Capes are now well below $10,000 from over $200,000 in 2008 while the BCI index reached its historic low at 311 points during January 2015.

Hence, it comes as no surprise that numerous ship owners consider the demolition market as a possible solution to dispose of old large sized vessels that fail to cover their operating expenses at market’s current levels.

But to conclude a perfect storm the steel market, that is the main driving force behind prices offered by cash buyers and recycling yards for the acquisition of vintage tonnage for demolition, is currently under strong pressure as well. The latter stems from increased exports of cheap Chinese steel that is not absorbed domestically and has flooded the Indian sub-continent. Moreover, prices offered by recycling yards are also negatively affected by the large volume of bulkers that are available to be sold for scrap.

The aforementioned situation has resulted in prices offered nowadays for wet tonnage to range from 210 to 390, depending on the destination, and for dry tonnage from 210 to 370. Just a year ago prices ranged from 310 to 500 for the dry tonnage and 325 to 510 for the wet, a difference of more than 100 dollars per ltd.

Nevertheless, the situation in the dry bulk market for the Capes is so difficult that we have seen a large number of vessels finding their way to recycling yards even at these low price levels.  In May alone, 15 Capes have been sold for scrap while the same number of Capesize vessels went for scrap during the entire first five months of last year. This is something that generally characterizes the market as demo activity across all segments is higher to the one observed last year.

At this point in time and given the situation in the dry bulk market one should expect the increased trend of vintage bulkers heading for demolition to continue up to the point where the freight market reaches a more viable equilibrium regarding supply and demand of tonnage. Bearing in mind the large volume of the dry sector orderbook this will definitely take some time and at the same time it will come as no surprise if current demo price levels slide further. Nonetheless, and despite any additional price softening that could be due, the demo market is expected to continue witnessing healthy activity, as long as the situation in the dry bulk market remains tricky.

Source: Read MT. 03 June 2015

http://readmt.com/analysis/article/2015/06/03/ship-owners-turning-to-scrap-market-to-cover-expenses/

Captain John’s removed from waterfront, will be taken to scrap yard:

The derelict boat that once housed Captain John’s floating restaurant has been towed away from the city's waterfront and is now making its final voyage across Lake Ontario.

The M/V Jadran, which was sold to the Marine Recycling Corporation earlier this month, was pulled from its slip at the foot of Yonge Street at around 10:30 a.m. by two large tow boats and taken through the Eastern Gap near Ward's Island.

The vessel is now on its way to a Port Colborne scrap yard, where it will be recycled.

Former owner John Letnik, who first brought the Jadran to Toronto from Yugoslavia, is aboard the ship for its final journey.

“I feel honoured that I was invited on her shortest voyage. I also made the longest voyage from Yugoslavia to Toronto with her,” Letnik told CP24. “There are lots of good memories. Especially, way back in the 70s and 80s I had everybody on board. Brian Mulroney, Bob Hope, the Village People were here. Christening, weddings, bar mitzvahs, whatever the occasion was.”

The complicated operation to remove Captain John’s marks an end of an era of sorts, as the one-time ferry had been tied up on Toronto’s waterfront since 1975 after being purchased by Letnik and repurposed as a floating restaurant.

The restaurant, however, fell on harder times in recent years and has been closed since the city shut off the water supply to the boat in 2012 due to $750,000 in back taxes owed by Letnik.

The removal of the ship today came after several false starts, including the court-ordered auction of the M/V Jadran last July. That deal was eventually scrapped after the buyer was unable to remove the ship from its slip by a court-set deadline.

The financial terms of the deal with Marine Recycling Corporation have not been released.

Discussing the scrapping of the ship with CP24 on Thursday morning, the founder of the company estimated that it could take about a month before Captain John’s is no longer.

“After a sampling and testing program, where we check for heavy metals, paints and PCP’s, the asbestos will abated from the ship first – probably a nine or 10 day process – and then the dismantling process starts,” Wayne Elliott told CP24 on Thursday morning. “Probably the top two decks will come off first and then the engines. We will then tow the ship down to our south slip and it will be gone in 10 days or so from that point.”

Source:  CP 24. 28 May 2015

http://www.cp24.com/news/captain-john-s-removed-from-waterfront-will-be-taken-to-scrap-yard-1.2394870

Vitter, Cassidy, Graves Introduce Legislation to Improve Ship Recycling, Create Jobs:

(Washington, D.C.) – U.S. Senators David Vitter (R-La.) and Bill Cassidy (R-La.) today introduced the Ships to Be Recycled in the States (STORIS) Act, legislation to reform the domestic marine recycling industry. Their legislation would improve the domestic ship recycling industry and promote transparency by requiring reports from Maritime Administration (MARAD) and an audit by the Government Accountability Office. Congressman Garret Graves (R-La.) is introducing the companion legislation in the U.S. House of Representatives.

“The Maritime Administration receives millions of dollars in federal funding, but they’ve never reported how the sales money is spent or how the agency awards contracts,” Vitter said. “Ship recycling is an important part of our domestic maritime industry, and these reforms would improve federal contracting, cut government waste, and help create jobs in Louisiana.”

“Louisiana directly benefits from the Maritime Administration—hundreds work in ship recycling facilities and many state museums receive maritime grants,” said Cassidy. “There have been concerns that the agency receives millions in federal funding but lacks transparency. The STORIS Act will strengthen oversight over the agency and help create more jobs for Louisiana workers.”

“Americans expect the federal government to operate in their best interest,” said Graves. “We have found multiple instances where the U.S. Maritime Administration has failed to maximize the return on investment on the sale of retired federal vessels by not accepting the highest bid on a number of contracts and not fulfilling its obligation to reinvest these funds in our merchant mariner workforce. This bill will prevent MARAD from leaving millions of dollars on the table in regard to ship recycling contracts and require that we have the workforce we need to increase global trade and exports from Louisiana.”

Current law requires all excess government vessels to be sold to domestic marine recyclers to be dismantled. A portion of funding from the sales goes toward the Vessel Operations Revolving Fund, federal and state maritime academies, and the maritime heritage grant program. The STORIS Act would make sure that the required funding goes to federal and state maritime academies and to heritage grants funding to the Department of Interior. It would also require MARAD to issue an annual report on how its money is spent and publicize its ship recycling agreements.

Additionally, the STORIS Act creates jobs by ensuring that all vessels can be dismantled in the United States in compliance with U.S. environmental and safety laws, and are not exported where those safety rules do not apply.

The STORIS Act is named in recognition of the former Coast Guard Cutter STORIS, which was dismantled in Mexico in 2013 in violation of the current law.

Source:  U.S. Senator David Vitter. 4 June 2015

http://www.vitter.senate.gov/newsroom/press/vitter-cassidy-graves-introduce-legislation-to-improve-ship-recycling-create-jobs

Legislation Targets US Ship Recycling Reform:

Legislation to reform the U.S. domestic marine recycling industry, the Ships to Be Recycled in the States (STORIS) Act, was introduced today by U.S. Senators David Vitter (R-La.) and Bill Cassidy (R-La.). Congressman Garret Graves (R-La.) will introduce the companion legislation in the U.S. House of Representatives.

The legislation aims to improve the domestic ship recycling industry and promote transparency by requiring reports from Maritime Administration (MARAD) and an audit by the Government Accountability Office.

“The Maritime Administration receives millions of dollars in federal funding, but they’ve never reported how the sales money is spent or how the agency awards contracts,” Vitter said. “Ship recycling is an important part of our domestic maritime industry, and these reforms would improve federal contracting, cut government waste, and help create jobs in Louisiana.”

“Louisiana directly benefits from the Maritime Administration—hundreds work in ship recycling facilities and many state museums receive maritime grants,” said Cassidy. “There have been concerns that the agency receives millions in federal funding but lacks transparency. The STORIS Act will strengthen oversight over the agency and help create more jobs for Louisiana workers.”

“Americans expect the federal government to operate in their best interest,” said Graves. “We have found multiple instances where the U.S. Maritime Administration has failed to maximize the return on investment on the sale of retired federal vessels by not accepting the highest bid on a number of contracts and not fulfilling its obligation to reinvest these funds in our merchant mariner workforce. This bill will prevent MARAD from leaving millions of dollars on the table in regard to ship recycling contracts and require that we have the workforce we need to increase global trade and exports from Louisiana.”

Current law requires all excess government vessels to be sold to domestic marine recyclers to be dismantled. A portion of funding from the sales goes toward the Vessel Operations Revolving Fund, federal and state maritime academies and the maritime heritage grant program. The STORIS Act would make sure that the required funding goes to federal and state maritime academies and to heritage grants funding to the Department of Interior. It would also require MARAD to issue an annual report on how its money is spent and publicize its ship recycling agreements.

Additionally, the STORIS Act creates jobs by ensuring that all vessels can be dismantled in the United States in compliance with U.S. environmental and safety laws, and are not exported where those safety rules do not apply.

The STORIS Act is named in recognition of the former Coast Guard Cutter STORIS, which was dismantled in Mexico in 2013 in violation of the current law.

Source:  maritime professional. 4 June 2015

http://www.maritimeprofessional.com/news/legislation-targets-ship-recycling-reform-272420

U.S. Senators Introduce Ship Recycling Legislation:

U.S. Senators David Vitter (R-La.) and Bill Cassidy (R-La.) introduced the Ships to Be Recycled in the States (STORIS) Act, legislation to reform the domestic marine recycling industry on Thursday.

Their legislation aims to improve the domestic ship recycling industry and promote transparency by requiring reports from Maritime Administration (MARAD) and an audit by the Government Accountability Office. Congressman Garret Graves (R-La.) is introducing the companion legislation in the U.S. House of Representatives.

“The Maritime Administration receives millions of dollars in federal funding, but they’ve never reported how the sales money is spent or how the agency awards contracts,” Vitter said. “Ship recycling is an important part of our domestic maritime industry, and these reforms would improve federal contracting, cut government waste, and help create jobs in Louisiana.”

“Louisiana directly benefits from the Maritime Administration—hundreds work in ship recycling facilities and many state museums receive maritime grants,” said Cassidy. “There have been concerns that the agency receives millions in federal funding but lacks transparency. The STORIS Act will strengthen oversight over the agency and help create more jobs for Louisiana workers.”

“Americans expect the federal government to operate in their best interest,” said Graves. “We have found multiple instances where the U.S. Maritime Administration has failed to maximize the return on investment on the sale of retired federal vessels by not accepting the highest bid on a number of contracts and not fulfilling its obligation to reinvest these funds in our merchant mariner workforce. This bill will prevent MARAD from leaving millions of dollars on the table in regard to ship recycling contracts and require that we have the workforce we need to increase global trade and exports from Louisiana.”

Current law requires all excess government vessels to be sold to domestic marine recyclers to be dismantled. A portion of funding from the sales goes toward the Vessel Operations Revolving Fund, federal and state maritime academies, and the maritime heritage grant program. The STORIS Act would make sure that the required funding goes to federal and state maritime academies and to heritage grants funding to the Department of Interior. It would also require MARAD to issue an annual report on how its money is spent and publicize its ship recycling agreements.

Additionally, the STORIS Act creates jobs by ensuring that all vessels can be dismantled in the United States in compliance with U.S. environmental and safety laws, and are not exported where those safety rules do not apply.

The STORIS Act is named in recognition of the former Coast Guard Cutter Storis, which was dismantled in Mexico in 2013 in violation of the current law.

Source: maritime-executive. 5 June 2015

http://maritime-executive.com/article/us-senators-introduce-ship-recycling-legislation  

Dry bulk ship owners caught between a rock and a hard place:

Ship owners active in the dry bulk market are in some tough predicament these days, as they appear to be caught between a rock and hard place, where the “rock” is the very low freight market rates and the “hard place” is the severe pressure experienced in the steel market, which in turn is negatively affecting the scrap market, i.e. the rates that owners can achieve for selling their older ships for demolition.

In its latest report, shipbroker Intermodal noted that the slowing Chinese GDP growth rate has severely impacted the dry bulk market, especially as it has coincided with the increased supply of dry bulk tonnage. As a result, daily rates for Capesizes are now trading well below the level of $10,000 from over $200,000 in 2008, with the Baltic Capesize Index (BCI) having retreated to a historic low of 311 points, back in January of 2015.

“Hence it comes as no surprise that numerous shipowners consider the demolition market as a possible solution to dispose of old large sized vessels that fail to cover their operating expenses at market’s current levels. But to conclude a perfect storm, the steel market, that is the main driving force behind prices offered by cash buyers and recycling yards for the acquisition of vintage tonnage for demolition, is currently under strong pressure as well. The latter stem from increased exports of cheap Chinese steel that is not absorbed domestically and has flooded the Indian sub-continent. Moreover, prices offered by recycling yards are also negatively affected by the large volume of bulkers that are available to be sold for scrap”, said Mr. Vassilis Logothetis, Intermodal’s Research Analyst.

Logothetis added that “the aforementioned situation has resulted in prices offered nowadays for wet tonnage to range from 210 to 390, depending on the destination, and for dry tonnage from 210 to 370. Just a year ago prices ranged from 310 to 500 for the dry tonnage and 325 to 510 for the wet, a difference of more than 100 dollars per ltd. Nevertheless, the situation in the Dry Bulk market for the Capes is so difficult that we have seen a large number of vessels finding their way to recycling yards even at these low price levels. In May alone, 15 Capes have been sold for scrap, while the same number of Capesize vessels went for scrap during the entire first five months of last year. This is something that generally characterizes the market as demo activity across all segments is higher to the one observed last year”.

He concluded that “at this point in time and given the situation in the Dry Bulk market one should expect the increased trend of vintage bulkers heading for demolition to continue up to the point where the freight market reaches a more viable equilibrium regarding supply and demand of tonnage. Having in mind the large volume of the Dry sector orderbook this will definitely take some time and at the same time it will come as no surprise if current demo price levels slide further. Nonetheless, and despite any additional price softening that could be due, the demo market is expected to continue witnessing healthy activity, as long as the situation in the Dry Bulk market remains tricky”.

Intermodal added that in the demolition market “demolition prices in the Indian subcontinent appear to have stabilized for now, following a month of significant discounts that have left the market with a lower new normal in terms of activity volume and price levels matching the year’s lows back in the beginning of March. Whether the summer season will continue in the same mood is too soon to tell. Breakers in Bangladesh and Pakistan will focus on the outcome of their countries’ respective budgets, both due before the end of the week. Should rumors for increased tax on the industry are announce, this will normally affect both prices and breakers’ appetite to acquire tonnage. On the other hand things in India seem to be slightly better, and this is evident in the presence of sales involving Indian breakers, who now seem a bit encouraged by the revival of both local steel prices and the Indian Rupee. Prices this week for wet tonnage were at around 225-385 $/ldt and dry units received about 210-370 $/ldt.”, the shipbroker concluded.

Source: hellenic shipping news. 5 June 2015

http://www.hellenicshippingnews.com/dry-bulk-ship-owners-caught-between-a-rock-and-a-hard-place/

Worker dies in Chittagong ship breaking yard accident:

A worker died after falling from a scrap ship in a ship breaking yard in Sitakunda upazila of Chittagong yesterday.

The deceased was Saddam Hossen, 22, son of Abdul Sattar of Kakoli village in Manda upazila of Noagaon.

He was working at the Crystal Ship Breaking Yard in South Sonaichari area, Sitakunda police quoted his co-workers as saying.

Saddam was declared dead at Chittagong Medical College Hospital.

Source: the daily star. 7 June 2015

http://www.thedailystar.net/city/worker-dies-ctg-ship-breaking-yard-accident-93400

Shipbreaking—the looming signal:

Concerns voiced over safety and environmental hazards associated with ship-breaking in Bangladesh are not new. The latest that has come is perhaps more strong-worded than ever. It has come from the Norwegian Ship Owners’ Association (NSA). At a recent convention held in Singapore, NSA advised its members not to allow recycling of their ships in Bangladesh, unless it is done in keeping with the Hong Kong International Convention for ‘Safe and Environmentally Sound’ recycling of ships. Reports say, NSA has decided not to export their ships for recycling in Bangladesh, as several earlier attempts to raise the ship-recycling standards in the country did not succeed.

The Norwegian stand appears to be further toughened by a reported move of the European Union (EU), which accounts for 20 per cent of the total scrap vessels sold around the world, to ban export of scrap ships to Bangladesh and other neighbouring countries. Twenty-eight countries under the EU are reported to have prepared a guideline banning export of their ships to the subcontinent — Bangladesh, India and Pakistan.

These, no doubt, are grave signals to reckon with, if the country is to see its ship-breaking industry continue, if not thrive, under the difficult circumstances. The concerns are not just expressions of anxiety as they used to be in the past, but are now clearly action-driven meant to cause a drastic cut in the availability of scrap vessels to be dismantled for recycling.

Given the state of things in the country’s ship-breaking yards, including among others the accidents and deaths due to unsafe conditions, one has to admit that the situation, neglected for decades without any meaningful improvement in work conditions, has by now become too heavy a burden to shoulder. There were repeated moves from various quarters including international bodies and rights groups to raise the standard of work culture in the ship-breaking yards. There are also allegations of ship-breaking companies importing highly toxic foreign vessels despite a ban. Besides, the 2009 court order to ensure workers’ safety and implement environmentally sound practices has not been adhered to. The media and the NGOs have been blaming state regulators — including the department of environment and the ministries of shipping and labour — for failing to protect coastal ecosystems and to monitor these companies’ compliance with safety precautions. Occasionally, there were some stern actions on the part of the law enforces as was seen in the eviction of two breaking yards which were set up by destroying coastal forest in Sitakunda, Chittagong in early February last year.

Of late, however, there are some moves to improve upon the prevailing situation. A work plan for improving health facilities and workers’ safety as well as for managing hazardous waste and addressing the problem of oil pollution under the German-funded partnership project is in the process of implementation. The authorities are also planning to set up a central dumping zone. Upgradation of facilities like fire fighting, cylinder storage and drinking water is also in the process. It will surely take time to see the results. Experts are of the opinion that piecemeal moves are not going to produce desired results. As the entire process involves a whole range of arduous activities, there has to be an integrated plan of actions to address each of those in a cohesive manner.

It is also true that not all the shipbreaking yards are equally lacking in the facilities. There are reports in newspapers that speak of considerable improvements in some of the yards in Sitakunda lately. Some of those were visited by senior foreign diplomats who took a positive note of their standards.

Ship-breaking, no doubt, is highly encouraging for Bangladesh, estimated to be worth around US$2.0 billion. While it offers employment to around three hundred thousand workers, it has the proven capacity for supporting a vast array of heavy and light engineering industries. Iron rods and billets that are recycled from ship scraps, believed to be of high quality, meet a major portion of domestic requirement in the construction sector. Old ships cater for 80 per cent of the demand for raw materials in the rerolling mills. Experts are of the view that Bangladesh is a unique place for ship-breaking and ship-recycling as nearly all the products available from dismantled ships are being used locally. As the advanced countries have given up on ship-breaking in view of the high cost of labour and accompanied compliance issues, ship-breaking has all the prospects to thrive in countries like Bangladesh.

This being the reality, it is indeed a matter of high priority that the stakeholders — mainly the government and the ship-breaking firms – put in their best to ensure that improvement in all critical areas are made visible within the shortest possible time.

Source: hellenic shipping news. 8 June 2015

http://www.hellenicshippingnews.com/ship-breaking-the-looming-signal/

Top 5: Places ships go to die

The top 5 shipbreaking nations have remained the same for almost a decade, with the South Asian nations India, Bangladesh and Pakistan accounting for around 50% of all merchant vessels and cruise ships sold for scrap each year. In these countries, ships are usually run aground at full speed onto heavily polluted beaches where they are stripped of all useable and recyclable parts.

In 2013, the most recent figures available, 1,119 ships were sold for scrap and 92% of them were broken up in these top 5 countries, Arabian Supply Chain.com (the online home of Maritime & Ports Middle East) takes a look at where they went to die.

Source: Arabian supply chain. 9 June 2015

http://www.arabiansupplychain.com/article-11431-top-5-places-ships-go-to-die/

Could Captain John's still live on?

Investors make last-ditch effort to save ship from scrapping

As she sits tied up at a Port Colborne scrapping yard, Captain John’s floating restaurant is yet again drawing a crowd.

A Boston-Miami investor group has offered about $100,000 to save the former Toronto tourist attraction from being cut up into recyclable pieces. And they aren’t alone.

One person has even inquired over what it would take to get the 90-metre ship, the Jadran, a new engine and put it back in business — a $10 million to $15 million proposition.

“I’ve probably talked four or five people out of being interested, just to do them a favour, really,” says veteran ship scrapper Wayne Elliott, who oversaw the towing of the ship from Toronto’s waterfront last month after years of legal battles over its fate.

“We’ve heard from a number of people and with some, it seems to be just emotion and not really well thought-out. Many don’t even have a final plan or a final destination for the ship.”

But some, like Boston-based John Scales, do. And there’s nothing in the contract that Elliott’s Marine Recycling Corporation has with Ports Toronto, Waterfront Toronto and condo developer Cityzen — worth an estimated $500,0000 — that says the ship has to be scrapped.  

Marine Recycling was simply contracted to remove the Jadran from Toronto’s waterfront, where it was a fixture for 40 years.

Scales is part of a three-person group of marine enthusiasts that has been trying to buy the Jadran for more than a year now. It had offered Ports Toronto $3,000 for the rusting ship, largely because of the high costs of moving it to drydock, before adding on the millions needed in restorations.

But now that Elliott’s Marine Recycling Corporation has done the heavy lifting — towing Captain John’s on May 28 to its Port Colborne scrapyard — Scales’ group has upped its price and is more determined than ever to give the ship yet another life, this time as a restaurant or entertainment venue.

The group already had three Ontario waterfront communities and about a dozen in the U.S. express interest in making a home for the ship once it’s restored, says Scales.

The investor group envisions a two-stage restoration — the first to get the three upper decks back in shape as an entertainment venue, the second to find some sort of use for the lower decks, which used to contain sleeping cabins in the days when the Yugoslavian ship was part of a luxury cruise line.

“We already have two good restaurant firms interested in leasing it for five years,” Scales added in a telephone interview after recently driving to Port Colborne from Boston to take yet another look at the ship.

“Captain” John Letnik has already offered to help out, in a bid to save his life’s work from destruction.

“I got as close as I could,” said Scales, of the ship, where crews have had a more challenging time than expected removing all the asbestos. “It’s sitting lower in the water (because of ballast Marine Recycling added to boost its towing stability) and looks longer and leaner.”

Elliott said his office has also had lots of calls from folks looking to buy mementos or artifacts from the ship now that it’s in “the funeral parlour of the shipping industry.”

“Obviously, if something still has good value, it does seem a bit of a shame to scrap it,” said Elliott, who’s been overwhelmed by the unusual outpouring of affection for a ship days away from the end of its life.

“I’m not saying this is a top candidate (for saving from the scrap heap.) My personal belief is likely none of these ideas could work out in time. So we’re carrying on with the next steps in the absence of something that sounds viable.”

Source: the star. 9 June 2015

http://www.thestar.com/business/2015/06/09/could-captain-johns-still-live-on.html