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GMS, the world’s leading buyer of ships for recycling, concludes its first-ever Hong Kong Convention compliant recycling deal with a Korean shipowner
 

The 149,322–dwt bulk carrier Keoyang Orient (built 1997) has been sold by its owner H-Line Shipping Co. Ltd on the condition the vessel was recycled according to the standards set out in IMO’s Hong Kong Convention. A spokesperson for H-Line Shipping said, “It was not an easy decision to consider green recycling for the first time as Korean shipowner but this is the only right way since shipping needs to become greener as part of ESG/CSR to support sustainable shipping.” 

Commenting on the deal, GMS trader Gyungbae Gil says, "GMS is delighted to help H-line Shipping recycle their vessel Keoyang Orient in a safe, clean and sustainable way. We believe H-Line is the first Korean owner to have opted for Hong Kong Convention (HKC) compliance and both welcome and anticipate more transactions of this nature in the months and years to follow.”

The move by H-Line Shipping is being seen in the wider context of a shift towards raising recycling standards across the whole of South Asia.  At India’s recycling hub of Alang, 95 recycling yards are now  HKC compliant and a further 10 Bangladesh yards are in the process of application. A call for even more green recycling yards has been made recently by the Asian Shipowners Association in anticipation of scrap volumes almost doubling next year to around 45.5m dwt, according to figures from leading brokers.

“This sale represents another important milestone in the transition to cleaner, safer ship recycling,” says Mr Gil. “We applaud H-Line Shipping for embracing the HKC and are honoured to have played a role.”

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[Podcast]  “Be patient” - container ship recycling will return

 

The container ship market will not see any significant recycling until rates fall to levels seen in 2016, according to Xeneta Chief Analyst Peter Sand talking on the GMS Podcast.

Mr. Sand said he believed strongly that a “sustained level of appallingly low freight rates” is needed for owners to opt for recycling, despite the current record levels for scrap steel.

Container ship owners, he says, are “loaded” after two years of making US100bn each year for the last two years and so not even remotely tempted by the record high scrap prices.

Pointing to an active second-hand market for box ships, Mr. Sand explains that owners are now “trading ships they have bought at record high prices for quite old skins” and that “everything that is capable of carrying boxes is sailing right now and making pocket loads of money.”

Mr. Sand expects the container market to remain firm for another couple of years and urges recyclers to “be patient” as “some of the old skins will find their way” to the recyclers’ yards.

In a wide-ranging discussion, Mr. Sand offers insight into the moves of German high street retailers Lidl into shipowning and the impact of Shanghai’s Covid lockdown on intra-Asian business.

Listen to the complete discussion on Apple Podcasts, Google PodcastsSpotify, and Amazon Music.

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The Process of Hong Kong Convention Statement of Compliance issuance

Demystifying Ship Recycling - Issue 21

Hong Kong International Convention for Safe and Environmentally Sound Recycling of Ships (HKC) was adopted in 2009. For the HKC to come into force, three criteria were mentioned. Out of the three, only the first has been fulfilled as of today. Shipping industry stakeholders expect the last criterion to be fulfilled by 2023. But during this decade-long journey, recycling facility owners in India, Bangladesh, Turkey, and China came forward to comply with HKC Recycling Standards voluntarily. A Classification Society issues a Statement of Compliance (SOC) after technically verifying that a recycling yard is in line with the HKC-2009. Presently, ClassNK, IRS, RINA, LR, and BV are the leading classification societies that have developed the guidelines to issue a SOC to recycling facilities.

Did we ever wonder, what is the procedure to get SOC? How much time does it take to issue SOC?

Any recycling facility that develops the infrastructure and demonstrates the recycling process as per HKC regulations is eligible for a SOC by a Classification Societies. The verification process by classification society is stringent and involves multiple stages.

Stage 1: A recycling yard that wishes to get SOC must develop infrastructure within its premises. The infrastructure includes the construction of impermeable floors and drainage systems to wash oily blocks, cutting zones, training facilities, SOPs, segregation, and temporary storage of hazardous wastes recovered from the vessels, etc. 

Stage 2: The recycling facility should prepare a Ship Recycling Facility Plan (SRFP) and submit an application to the Classification society.

 

Stage 3: The classification society reviews the application and SRFP to verify that operations and procedures followed by the recycling yard comply with IMO Resolution MPEC. 210(63). As per the review, the required amendments are directed to the recycling yards. The time taken to complete this stage is between 2 to 12 months.

Stage 4:  The classification society carries the site inspection to examine the operations and procedures described in the SRFP are followed in actual practice. Major Non-Conformities (MNC) and Non-Conformities (NC) are raised during the inspection. Supplementary audits are carried to check the corrective actions are being taken. It takes 3 to 12 months to conduct site inspections and implement corrective measures.

Stage 5: After completing site inspection, document review, and closure of MNCs & NCs, a SOC is issued. Like any other class certificate, SOC has an expiry date and is subject to annual and renewal audits. 

In general, a yard takes around 10 to 12 months to get a SOC after developing an infrastructure; sometimes, it even takes longer.

As of now, 92 yards in India, 1 yard in Bangladesh, 2 yards in China, and 14 yards in Turkey have received SOC.

Getting a SOC for a recycling yard is a rigorous and time-consuming process and requires commitment and considerable investment in infrastructure from recycling facility owners. The efforts and persistence shown by recycling facility owners are simply commendable. The classification societies have come forward to verify technical guidelines to improve the process of ship recycling globally. 
 

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Demystifying Ship Recycling - Issue 20

Pulling of ships towards the recycling yards

In major ship recycling destinations such as Turkey, India, Pakistan, and Bangladesh, ships are recycled at the sea-shore interface. Superannuated ships are delivered to the recycling facilities, where the hull is cut into big slices. These gigantic slices are shifted to the secondary cutting zones for the extraction of steel plates. The ship’s hull needs to be gradually pulled towards the ship recycling yard to cut further slices. Have you ever wondered how the massive hull of a ship is pulled towards the recycling facility?

Ship recyclers who recycle ships at sea-shore interfaces have developed unique techniques to pull the hull towards yards. Strategic windows are cut on the ship’s side shell on the port and starboard side. Through these openings, giant chains are passed. These chains are connected to the steel wires with the help of robust shackles and pulleys. Steel wires are connected to the heavy-duty winches. These heavy chains, shackles, and pulleys are shifted and passed through the hull openings with the help of moving cranes.

The wires used for winching operation are typically 32 mm in diameter.

Usually, any ship recycling facility has two or sets of winches. These winches are powered by diesel engines. Winches are periodically load tested. Routine maintenance is carried out on the winches and their prime movers. Protective guards cover winches to guard the operator in case the wire snaps.

The ship’s hull is pulled towards the recycling yard during high tide because the aft part of the hull gets partially lifted due to buoyancy and significantly lessens the load on the winches. Before pulling operation, adjacent recycling facilities are alerted beforehand. Throughout this critical operation, none of the other tasks are allowed in the yard. 

Following the winching operation, the steel wire ropes are coiled and stored in the trays adjacent to the winches. Qualified inspectors regularly inspect the wires for any kinks, broken strands, corrosion, and any other defects. It helps to assess the real condition of the wires and the need for replacement. 

With the use of heavy-lift capacity cranes with more extended booms, larger slices are cut and lifted from the ship’s hull and kept on the secondary cutting zones, minimizing the use of winches to pull the hull.

The process of pulling the hull is periodic and needs to be conducted with absolute care and precautions. Few recycling facilities use the load cells to monitor the load applied on the wires as they have understood the significance of monitoring load. And they have developed the Standard Operating Process to execute these critical tasks seamlessly without any incident and accident. 
 

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Demystifying Ship Recycling - Issue 19

Used and unused spare parts recovered during ship recycling

Ships run round the clock transporting raw commodities and finished goods across the continents. Even in pandemic times, when the entire world was at a standstill, ships ran and kept global supplies uninterrupted. Did we ever wonder who keeps these ships moving? The answer is simple and straightforward: the machinery installed on ships and the seafarers who operate them.

An oil tanker takes around 18 days to sail from a load port in Arabian Gulf to a Far East discharge port. It simply means the Main Engine and other auxiliary machinery that started operating when the vessel is in Arabian Gulf will continuously run for the remaining 18 days to arrive in the Far East.

Machinery parts are subjected to have wear & tear and breakdowns because of nonstop operation. For the smooth functioning of this machinery, it is critical to carry out regular planned maintenance. Ships are supplied with adequate spare parts throughout her life for conducting planned maintenance and troubleshooting. These spare parts are periodically used to replace old used spares. Used spares are recovered and often reconditioned for reuse.

It is mandatory for ships to maintain an adequate inventory of critical spare parts. When ships complete their useful life, they are sent for recycling. The vessels delivered for recycling often carry used and unused spares. Ship recycling facilities recover these spares and sell them in the secondhand market. There are clusters of at least 700 shops along the road leading to Alang beach, India. These shops buy the recovered spares and stock them at the warehouse. Similar spares clusters are found in Chittagong, Bangladesh. 

spare parts recovered during ship recycling

The secondhand market covers all types of spares for the machinery used onboard vessels. Some vendors stock only specific types of spares. It is usual to find vendors who stock and sell only anchor and anchor chains. Some vendors stock the spare parts for the Main Engine, such as piston crowns, piston rings, liners, etc. 

In fact, some vendors stock critical spares for pneumatic and hydraulic systems. It is common to see a warehouse with only lathe machines and emergency generators storage.

It is easy to discover the spares for machinery at Alang, whose manufacturing is stopped by the original makers. Some of these spares are critical and need to be connected at short notice. 

Recovery, resale, and reuse of the spares from recycled vessels is the true example of the Circular Economy. The spares not only generate value but also serve the ships in critical moments. 
 

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