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When a ship or floating/offshore asset reaches the end of its economic or functioning life (generally 20 years and older), the unit is sold for recycling at one of the 5 major destinations in the world: India, Bangladesh, Pakistan, China, or Turkey.

The assets are sold / purchased based on the weight of the steel: This is known as a per / LDT (Light Displacement Tonnage) transaction with most of the constituent parts being melted down for recycling or re-used as follows:

  • The ship’s steel is cut into plates, which are re-used in steel/re-rolling mills.
  • The main engine, generators, and pumps onboard are resold into the second-hand market.
  • Non-ferrous metals from cables and panels are resold intact or extracted for their metals.
  • Lifeboats, furniture, galley items, and various other reusables are sold to local fishermen and other surrounding communities.

In essence, ship recycling truly helps to extend a ship’s “useful” life well beyond its intended design.

In today’s ship recycling business, companies such as GMS are key players / stakeholders, who purchase a vessel for "Cash" from the Owners and redeliver the ship/offshore asset to a recycling yard (Ship Recyclers or 'end users'). Buyers such as GMS are not brokers, they are PRINCIPALS/TRADERS, and they can take delivery of vessels on both “delivered” and “as is where is” terms.

Business functions performed by GMS include

  • Sale and Purchase
  • Financing – taking title of the vessel against full payment
  • Market Research
  • Valuations – forecasting future prices, demand/supply factors, market movements, and other relevant business-specific issues
  • Risk Management – underwriting market, operational, performance, currency, demand/supply, and various other risks associated with the industry

However, as the ship recycling industry continues to mature (especially in the Indian sub-continent markets), GMS continues to expand its portfolio of services to encapsulate “Green recycling” via our GMS Responsible Ship Recycling Program (GMS RSRP) that is executed in accordance with IMO’s “Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships” (HKC). Please visit this link to learn more about our Sustainable Ship and Offshore Recycling Program.

Today, GMS prides itself as an industry leader, having successfully negotiated more than 4,000 ships / offshore assets since its inauguration in 1992. Since 2008, 1 in 3 ships sold into the Indian sub-continent has been delivered by one of our principals.

Please download "GMS FACTS", which highlights our noteworthy accomplishments and how we can best assist you.