Renewed calls for change as Asian ship scrapping rises in 2021

More than 30% increase in demolishing oceangoing ships and offshore units at beaching yards in India, Pakistan and Bangladesh last year prompts dismay.

Many more ships were scrapped at beaching yards in India, Pakistan and Bangladesh last year than in 2020, according to latest figures from NGO Shipbreaking Platform.

A more than 30% rise to 583 oceangoing ships and offshore units sold for recycling at the yards, up from 446 in 2020, accounted for 76% of the 763 large vessels demolished worldwide in 2021.

The increase has led to calls for shipowners to raise their recycling game by promoting sustainable practices at South Asian ship-breaking yards.

Ship-breakers in the region handle over two-thirds of the larger vessels dismantled globally, due to capacity constraints elsewhere.

Some Asian scrap yards have improved their standards, but many still have poor safety and pollution records despite growing pressure for safe and green recycling.

In 2021, at least 14 workers died while breaking vessels on the beach of Chattogram, Bangladesh, and another 34 were severely injured. Local sources also reported two deaths in Alang, India, and two deaths in Gadani, Pakistan, NGO Shipbreaking said.

Some of these accidents took place onboard vessels owned by well-known shipping companies, such as Berge Bulk, Nathalin Co, Polaris Shipping and Winson Oil, the NGO added.

“We have been witnessing this environmental and human rights scandal for too long. All shipowners are aware of the dire situation at the beaching yards and the lack of capacity to safely handle the many toxic materials on board vessels. Yet, with the help of scrap dealers, the vast majority choose to scrap their end-of-life fleet in South Asia as that is where they can make the highest profits,” said Ingvild Jenssen, executive director and founder NGO Shipbreaking.

Owners based in the United Arab Emirates sold 60 ships for scrapping in South Asia, most of which were beached in Bangladesh and Pakistan, the lobbying group said, and Singapore, Greece and the US followed with more than 40 ships beached each.

The EU has approved 44 sites around the world for safe and environmentally sound operations, but no South Asian yard has been approved due to the lack of capacity to safely handle and dispose of hazardous materials.

Only 37 vessels were recorded recycled in EU-approved facilities in 2021, NGO Shipbreaking said.

South Korea’s Sinokor was again singled out for criticism by the NGO, having scrapped 12 vessels in Bangladesh and Pakistan.

Singapore-based recycling consultancy Sea Sentinels said the onus is on owners to take responsibility.

“The fact is, while these yards are still largely unregulated, there are few alternatives for shipowners due to a lack of available capacity at EU-compliant facilities,” said Rakesh Bhargava, chief executive of Sea Sentinels.

Shipowners need to actively look for and promote the development of alternatives to comply with regulations for the shipment of hazardous waste, he added.

Danish Shipping executive director for climate, environment and security, Maria Skipper Schwenn, said South Asian yards offer premium steel prices due to lower labour and overhead costs, and can also gain higher prices for steel.

The International Maritime Organization’s Hong Kong Convention (HKC) on the Safe and Environmentally Sound Recycling of Ships sets a global standard for recycling facilities, including the safe handling of hazardous materials, but has not yet entered into force as it needs to be ratified by a minimum of 15 countries representing 40% of gross tonnage.

A Bimco survey revealed many EU-compliant yards were working at near capacity and were not interested in recycling larger vessels due to the workload, costs of transporting steel and relatively low profitability, according to Schwenn.

“The whole capacity issue is really difficult. We are looking at where there is actual capacity at the beaching yards and believe that by focusing on upgrading these facilities and ensuring safe and sustainable practices, this can really make a big difference,” Schwenn said.

Many shipowners have adopted sustainable ship recycling plans, but in some cases this has led to “greenwashing”, Bhargava said, with a gap between policy intentions and implementation.

But he added shipowners and cash buyers can be held liable for incidents caused by irresponsible ship-breaking practices, as shown by recent court cases in Europe.

“It is therefore important that both parties carry out due diligence and have an agreement in place to ensure responsible recycling of the ship,” he said.

More responsible cash buyers are buying into the safe recycling agenda but there remains “a need for greater due diligence”, Schwenn said, as well as on-site supervision to enforce sustainable recycling policies given some owners can “fly under the radar”. (Copyright)

For more information, contact:

Rakesh Bhargava, CEO
Sea Sentinels
Tel: +60 12 215 0137