More than 80% of box and bulk ships to fall in lowest CII ratings - GMS

“More than 80% of these ships will be in the lowest C, D, and E categories of CII,” he told Seatrade Maritime News, citing the firm orderbook for containers and the large volume of deliveries this year and next as some of the reasons for higher recycling volumes.

He referred to a Far East container ship owner (believed to be Taipei-based Wan Hai Lines) which committed 10 feeder vessels for recycling in December. “In GMS’ 30-plus years of experience, this is the highest number of ships that have ever been simultaneously offered for recycling by a single owner,” he commented.

On the question of recycling capacity, Sharma is cautious. “While there is capacity in all three major ship recycling destinations [India, Bangladesh, Pakistan], the question is whether the existing regulations will create a bottleneck by favouring EU yards,” he said. He was referring to the Basel Convention which classifies ships to be recycled as ‘waste’.

“Regrettably, a ship destined for recycling at an EU port falls under the Waste Shipment Regulation,” he explained. “As a result, EU shipowners are limited to recycling their ships in the EU, where facilities do not exist, or in Turkey, an OECD nation.

“However, there are only six yards in the EU list that are capable of recycling and they have a total annual capacity to recycle a mere 20 ships, as compared with 200 by India. There is no doubt that the recycling capacity in OECD nations is inadequate,” Sharma declared.

In practice, though, India is currently the global leader in green recycling, with 97 yards vetted and approved under the IMO’s Hong Kong Convention by leading classification societies, owners, capital providers, and independent green ship recycling specialists, he pointed out. (However, none are believed yet to have been validated under the EU Ship Recycling Regulation.)

“It should also be noted that the increasing focus on green ship recycling demonstrates the fact that owners are seeking to use yards that are Hong Kong Convention-compliant – which is encouraging since this regulation will level the playing field for a greener maritime future,” Sharma added.