24 September 2015

China's shipbreakers take a hammering:

Falling steel price and lower cost South Asia rivals make many businesses unsustainable

IT WAS quiet at the Seventh Ship Recycling & SNP Summit held in Shanghai last week. Participants, less than half the expected number, milled about in subdued, even downcast, manner. Elaborate placement of scattered seats in the large hall made the conference look even more underattended.

“This year’s meeting is particularly sluggish,” admits a staff member from organiser Enmore Group.
So is the shipbreaking market in China.

The business, which thrived on China’s fast growth after the earlier 1980s’ opening-up reform, has now gradually turned into a dying industry — facing depressed steel prices and overwhelming challenges from the Indian subcontinent.

The number of active players has diminished significantly: from about 30 between 2009 and 2010 during when the market was puffed up by Beijing’s Yuan4trn ($628.4bn) stimulus package, to fewer than 10 now, according to shipbroker Far East Horizon Shipping Consulting.

The survivors are hardly better off, vexed by a trail of red ink. Qian Haiping, general manager of Jingjiang Xinmin Shipbreaking based in southeast China, says not only has his company yet to make any profit since the domestic steel market began to collapse in 2012, but also it has lost almost all cash reserves from earnings banked in the earlier good days. “We are very pessimistic,” he says.

With the fall in steel price outpacing the cost of demolishing the retired vessels, each ship dismantled adds to a loss to the yards, said China National Shipbreaking Association in its 2015 interim report. The industry’s total losses during the period have exceeded Yuan300m ($47.1m).

Lower revenue, higher cost
Cheap as cabbage — that’s how traders mock the value of Chinese steel. The average price for local steel scrap has declined by almost two-thirds from its peak four years ago to around Yuan1,200 ($188) per tonne in August, according to data from industry consultancy Mysteel.

A quick recovery is unlikely, however. Analysts suggest that the country’s slowing economy will continue to weigh on steel consumption, and trimming excess capacity can take time due to employment concerns.

While revenues have shrunk, costs are climbing. Workers at major Chinese ship-recycling yards are making about Yuan4,000 a month — twice the wage in India. Yet in China, few young people are interested in the job, says Liu Yanhui, deputy general manager of Jiangmen Zhongxin Shipbreaking & Steel Co, another major Chinese shipbreaker based in Guangdong province.

Meanwhile, tightening government rules in environmental protection have also translated into higher costs, including  required facility investment and added interest on loans as a result of a longer scrapping process.

“But India, Bangladesh and other south Asian countries still use the traditional beaching, [which directly puts China’s ship-recycling industry at a competitive disadvantage]."

As a result, the price today that Chinese shipbreakers can at best offer for old tonnage is only half the rate offered by their Indian peers. Prices for a handysize bulker, for example, stood at around $150 per ldt in China, while the India yards could bid more than $320, brokers said.

“With that price spread, we won’t be able to acquire any ships from abroad,” Mr Qian says.

Government subsidies
However, there are still vessels available, supported by the scrap-and-build subsidy that Beijing launched last year and later granted a two-year extension till end-2017.

The incentive scheme, although providing no direct handouts to shipbreakers, stipulates that all Chinese shipowners that seek the handouts must dispose of their vessels at compatriot yards. 

As of end-July, 95 out of the 100 vessels dismantled in the country this year are Beijing’s subsidised tonnages, according to FEHSC.

However, the Chinese shipbreakers stand to lose this life preserver should there be no further extension of the subsidy in about two years’ time.

“They could face a dead end where there is no vessel to scrap,” said Ji Miao, FEHSC’s senior manager, who previously served as operation director at Taizhou Weiye Shipbreaking.

Mr Qian says his yard is deeply concerned about the future and might be forced to change business.

Hopes for green recycling
The predicament has made some yards pin hope on the ship-recycling regulation of the European Union, which offers Chinese players operating at a higher technical standard than their Indian and Bangladeshi colleagues a chance to gain an edge in green recycling.

According to the regulation, ship-recycling facilities will have to be included in the “EU List” — naming those yards that comply with a string of environmental requirements — in order to recycle EU-flagged ships from December 31, 2018 at the latest. Mr Liu says his yard, Zhongxin, gained the certificate from ClassNK in 2012 to carry out environmental ship recycling based on the Hong Kong Convention, having invested hugely in improving yard facilities. That includes construction of an asbestos second treatment centre and a 5,000-tonne floating dock that obviates the need to beach ships.

Now the company is working with the Japanese institution again on a recycling model that aims to meet the EU requirements.

“I think the green recycling has a future,” he says, “But before that, we need more government support, especially tax rebates, in order to survive.”

China imposed a 17% VAT and 3% tariff on every old ship imported, and the yards demand a reduction of such taxes in compensation for the extra spending on conducting green scrapping, partly also requested by the government. 

But the likelihood of Beijing budging seems low, as the role of the shipbreaking industry played in China’s economy has largely weakened today.

Steel scrap produced by the industry accounts for merely 0.2% of the country’s total output, data from CNSA and China Iron and Steel Association shows.

Zhongxin has dismantled about 150,000 ldt of retired vessels in the first half of this year, a good result in tonnage terms. But Mr Liu says the yard has decided to largely reduce the volume in the second half.
“We need to narrow the losses as the market seems to get bleaker,” says Mr Liu.

Source: lloyds list. 22 September 2015

http://www.lloydslist.com/ll/sector/ship-operations/article468957.ece 

US ship holder agrees to stop sending its old ships to South Asia beaches:

Horizon Trader being towed out of Brownsville (Foto: © Basel Action Network)

Seattle, USA — Shipping company Matson, Inc. has agreed to prohibit scrapping its vessels on the beaches of India, Bangladesh and Pakistan in the future. While the decision does not address the „Horizon Trader“,– an old Matson vessel now on its way to India, it is significant, as 23 vessels in the Matson fleet will require scrapping in the next few years. Meanwhile, Basel Action Network and the NGO Shipbreaking Platform in Brussels, call on All Star Metals of Brownsville, Texas, the last holder of Horizon Trader, to return the ship to the U.S. for proper recycling in their Brownsville ship recycling yard.

„While we regret that one more US ship is likely to end up on the killing beaches of South Asia, we recognize the important commitment Matson has made for future recycling contracts“, says Colby Self from Basel Action Network (BAN). „Ship owners today can no longer claim ignorance. They know very well the environmental and human health impacts of their ship recycling decisions, which for too long have been ignored to maximize profits. Matson’s off-the-beach commitment reflects a level of corporate leadership which we hope will be echoed by other U.S. shipping companies.“

In the Caribean Sea instead of Texas

The Horizon Trader, a 42 year-old US flagged container ship was acquired by Matson when they purchased Horizon Lines late last year. A decision was then made to scrap the vessel and it was delivered to the All Star Metals ship recycling facility in Brownsville, Texas in January 2015.

However, instead of being recycled in accordance with U.S. environmental health and safety laws, creating local jobs, the Horizon Trader was photographed on September 2nd being towed out of the Port of Brownsville with fresh paint on the ship’s hull masking the true identity of the vessel. The U.S. Maritime Administration and the U.S. Environmental Protection Agency confirmed to BAN that the Horizon Trader was authorized for export to the shipbreaking yards in India. The ship is now in the Caribbean Sea. BAN obtained the original Horizon Lines Memorandum of Agreement for the sale of the Horizon Trader, which stipulated that the buyer would responsibly recycle the vessel in the U.S.

BAN then notified Matson and asked the company to recall the ship, and while they claimed they no longer had the authority to recall the ship, they released the following statement: „Because of concerns with recycling practices in South Asia, Matson has decided to expressly prohibit recycling of its vessels in this region going forward.“

Growing consensus of US ship owners

The statement is reflective of a growing consensus of ship owners. Already in Europe the Norwegian Shipowners’ Association and its 160 members recently voted to prohibit Norwegian-owned ships to be scrapped on South Asian beaches. This move follows other large foreign ship owners that have also adopted „off-the-beach“ ship recycling policies, including Norwegian ship owners Grieg, Wilhelmsen and Høegh, along with German Hapag-Lloyd, Danish Maersk Lines, Royal Dutch Boskalis, Canadian CSL Group, and Singaporean China Navigation Company.

The U.S. government has likewise maintained a long-standing policy that requires its own ships to be recycled domestically and off the beaches. Ironically this stands in stark contrast to the fact that the U.S. government allows private ship-owners to legally reflag their vessels for disposal on foreign shipbreaking beaches. „While the export may be legal according to U.S. law, it outsources pollution and U.S. jobs to Asia,“ said Self Colby. „It is highly irresponsible. We ask All Star Metals as a U.S. ship recycling company purporting to be a green ship recycler, to turn the Horizon Trader back to Texas for proper recycling.“

Source: recycling portal. 23 September 2015

http://recyclingportal.eu/Archive/17485 

Matson Shipping Agrees to Stop Sending its Old U.S. Ships to the “Killing Beaches” of South Asia:

Following an alarm raised by the environmental justice organization Basel Action Network (BAN), the shipping company, Matson, Inc. (MATX) agreed to prohibit scrapping its vessels on the beaches of India, Bangladesh and Pakistan in the future. While the decision does not address the HORIZON TRADER – an old Matson vessel now on its way to India, it is significant, as 23 vessels in the Matson fleet will require scrapping in the next few years.

Meanwhile, BAN and the NGO Shipbreaking Platform in Brussels, call on All Star Metals of Brownsville, Texas, the last holder of HORIZON TRADER, to return the ship to the U.S. for proper recycling in their Brownsville ship recycling yard.

Shipbreaking practices in India, Pakistan, and Bangladesh operate under dangerous and polluting conditions. Workers labor on tidal sands to cut ships by hand, breathe in toxic fumes and asbestos, and fall victim to explosions and accidental crushing. According to the International Federation for Human Rights (FIDH), up to 20% of the shipbreaking workforce in Bangladesh are children under the age of 15. Just last week there was an accident on the notorious shipbreaking beach at Chittagong that killed 4 workers. 5 workers were killed in July, adding up to a reported 9 deaths in less than two months, and over 200 deaths documented over the past 5 years.

“While we regret that one more U.S. ship is likely to end up on the killing beaches of South Asia, we recognize the important commitment Matson has made for future recycling contracts,” said Colby Self, the Green Ship Recycling Director at BAN. “Ship owners today can no longer claim ignorance. They know very well the environmental and human health impacts of their ship recycling decisions, which for too long have been ignored to maximize profits. Matson’s off-the-beach commitment reflects a level of corporate leadership which we hope will be echoed by other U.S. shipping companies.”

The HORIZON TRADER, a 42 year-old US flagged container ship was acquired by Matson when they purchased Horizon Lines late last year. A decision was then made to scrap the vessel and it was delivered to the All Star Metals ship recycling facility in Brownsville, Texas in January 2015.

However, instead of being recycled in accordance with U.S. environmental health and safety laws, creating local jobs, the HORIZON TRADER was photographed on September 2nd being towed out of the Port of Brownsville with fresh paint on the ship’s hull masking the true identity of the vessel. The U.S. Maritime Administration (MARAD) and the U.S. Environmental Protection Agency (EPA) confirmed to BAN that the HORIZON TRADER was authorized for export to the shipbreaking yards in India. The ship is now in the Caribbean Sea. BAN obtained the original Horizon Lines Memorandum of Agreement for the sale of the HORIZON TRADER, which stipulated that the buyer would responsibly recycle the vessel in the U.S.

BAN then notified Matson and asked the company to recall the ship, and while they claimed they no longer had the authority to recall the ship, they released the following statement:

“Because of concerns with recycling practices in South Asia, Matson has decided to expressly prohibit recycling of its vessels in this region going forward.”

The statement is reflective of a growing consensus of ship owners. Already in Europe the Norwegian Shipowners’ Association and its 160 members recently voted to prohibit Norwegian-owned ships to be scrapped on South Asian beaches. This move follows other large foreign ship owners that have also adopted “off-the-beach” ship recycling policies, including Norwegian ship owners Grieg, Wilhelmsen and Høegh, along with German Hapag-Lloyd, Danish Maersk Lines, Royal Dutch Boskalis, Canadian CSL Group, and Singaporean China Navigation Company.

The U.S. government has likewise maintained a long-standing policy that requires its own ships to be recycled domestically and off the beaches. Ironically this stands in stark contrast to the fact that the U.S. government allows private ship-owners to legally reflag their vessels for disposal on foreign shipbreaking beaches.

“While the export may be legal according to U.S. law, it outsources pollution and U.S. jobs to Asia,” said Self. “It is highly irresponsible. We ask All Star Metals as a U.S. ship recycling company purporting to be a green ship recycler, to turn the HORIZON TRADER back to Texas for proper recycling.”

Source: hellenic shipping news. 24 September 2015

http://www.hellenicshippingnews.com/matson-shipping-agrees-to-stop-sending-its-old-u-s-ships-to-the-killing-beaches-of-south-asia/   

Press Release - NGOs applaud Matson for clean and safe recycling policy, but regret ship beached in India

Brussels, 23 September 2015 - The NGO Shipbreaking Platform applauds US shipping company Matson, Inc. for committing to recycle its old ships only in responsible yards in the future. This decision is significant, as 23 vessels in the Matson fleet have to be dismantled in the coming years.

This decision comes in the aftermath of the Platform’s US-based member organisation Basel Action Network (BAN) having revealed and strongly criticized the sale of the Matson owned HORIZON TRADER for substandard scrapping in India. The vessel will soon be beached in Alang. The Platform and BAN call on All Star Metals of Brownsville, Texas, the last holder of HORIZON TRADER, to return the ship and ensure the clean and safe recycling of the vessel.

The HORIZON TRADER, a 42 year-old US flagged container ship was acquired by Matson when they purchased Horizon Lines late last year. A decision was then made to scrap the vessel and it was delivered to the All Star Metals ship recycling facility in Brownsville, Texas in January 2015. BAN obtained the original Horizon Lines Memorandum of Agreement for the sale of the HORIZON TRADER, which stipulated that the buyer would responsibly recycle the vessel in the U.S.

Shipbreaking yards in India operate under dangerous and polluting conditions. Workers labor on tidal sands to dismantle the vessels, breathe in toxic fumes and asbestos, and fall victim to accidents. They live in shacks close to the yards often without basic sanitary facilities or supply with drinking water. Asbestos removed from the vessels is freely traded in the local marketplace. Recent satellite images show oil spills from beached vessels.

“The conditions in the shipbreaking yards are not line with international standards for environmentally sound management, occupational health and safety rules, and fundamental labor rights – if Indian shipbreakers want to be part of a global industry providing services to international shipping companies that are more and more conscious of environmental and social issues, they have to live up to these standards”, says Patrizia Heidegger, Director of the NGO Shipbreaking Platform.

"While the export of the Horizon Trader may be legal according to U.S. law, it outsources pollution and U.S. jobs to Asia and is highly irresponsible. We ask All Star Metals as a U.S. ship recycling company purporting to be a green ship recycler, to turn the HORIZON TRADER back to Texas for proper recycling," said Colby Self, green ship recycling campaigner at the Basel Action Network.

 

The HORIZON TRADER was photographed on September 2nd being towed out of the Port of Brownsville with fresh paint on the ship’s hull masking the true identity of the vessel. BAN then notified Matson and asked the company to recall the ship, and while they claimed they no longer had the authority to recall the ship, they released the following statement:

"Because of concerns with recycling practices in South Asia, Matson has decided to expressly prohibit recycling of its vessels in this region going forward."

The statement is reflective of a growing consensus amongst ship owners. Already in Europe, the Norwegian Shipowners’ Association and its 160 members recently voted to prohibit Norwegian-owned ships to be scrapped on South Asian beaches. This move follows other large foreign ship owners that have also adopted "off-the-beach" ship recycling policies, including Norwegian ship owners Grieg, Wilhelmsen and Høegh, along with German Hapag-Lloyd, Danish Maersk Lines, Royal Dutch Boskalis, Canadian CSL Group, and Singaporean China Navigation Company.

"Matson’s off-the-beach commitment reflects a level of corporate leadership which we hope will be echoed by other U.S. shipping companies,” said Colby Self.

The U.S. government has likewise maintained a long-standing policy that requires its own ships to be recycled domestically and off the beaches. Ironically this stands in stark contrast to the fact that the U.S. government allows private ship-owners to legally reflag their vessels for disposal on foreign shipbreaking beaches.

CONTACT

Patrizia Heidegger
Executive Director
NGO Shipbreaking Platform
patrizia@shipbreakingplatform.org
+32 2 6094 419

Basel Action Network:

Colby Self
colby.self@gmail.com  
+1 (206) 250-5652

Jim Puckett, Executive Director
jpuckett@ban.org
+1 (206) 652-5555


Source: NGO Shipbreaking Platform. 23 September 2015

17 September 2015

Navy consideration of scrapping third ship of Zumwalt-class destroyer doesn't come as a surprise:

destroyer

THE MIL & AERO BLOG, 15 Sept. 2015. I see reports this week that U.S. Navy leaders are ready to pull the plug on plans to build a fleet of large surface warships designed specifically for long-range shore bombardment -- a role filled during World War II by the Navy's battleships and heavy cruisers.

The issue revolves around the Navy's Zumwalt-class destroyer, a 600-foot 14,800-ton maritime behemoth designed around the Advanced Gun System (AGS), a 155-millimeter cannon designed to hurl special shells as far as 83 nautical miles at a rate of 10 rounds per minute.

Navy leaders went forward with the Zumwalt destroyer program on the assumption that they would build 32 of these formidable shore-bombardment warships. Since then the number of planned Zumwalt destroyers dwindled to seven, and now to three.

The third ship of the class, the USS Lyndon B. Johnson, is at the eye of the storm. Navy leaders are considering scrapping the third Zumwalt land-attack destroyer, even though the vessel is already under construction, in efforts to cut the rising costs of the program.

The estimated procurement cost for all three vessels has increased by 37 percent since 2009 to $12.3 billion, according to a Bloomberg Business story by longtime defense reporter Anthony Capaccio, entitled General Dynamics Destroyer Reviewed by U.S. for Cancellation.

If you ask me, the death of the Zumwalt-class destroyer program has been a long time in coming. The big ship dedicated to shore bombardment has a questionable role in this era of cruise missiles, smart munitions, and modern jet fighter-bombers. Even if the ship were to fill an obvious need, how much punch would two or three ships offer?

Let's face it: cutting the size of an entire class of ships to two or three reduces the vessel to irrelevance. It does have a modern "stealthy" design to reduce its radar signature, but the thing is 12 stories tall and about the same mass as a Virginia-class battleship from generations ago. How stealthy can it be?

Experts argue that the Zumwalt-class destroyer packs an offensive punch found nowhere else in the Navy's fleet, except for the fighter-bomber aircraft aboard the aircraft carriers. That's a good point, and whittling down the Zumwalt program to essentially nothing, that's a capability the Navy will have to do without.

Losing the third ship of the Zumwalt class will save money and barely would be noticed by naval planners. No doubt its offensive capabilities would have been useful had the ship been built in substantial numbers, but not in just a handful.

All this is not to say that the Zumwalt destroyer program has been for nothing. The ship has value as a technology development laboratory -- albeit an expensive one.
The ship is designed with revolutionary power generation. It uses electricity generated by gas turbines to power all of its systems, including weapons. The Zumwalt's power system design potentially could be applied to new ship classes, or perhaps even as backfits to existing ship designs.

The Zumwalt design also offers a broad range of enabling technologies in systems automation to reduce the ship's complement of officers and enlisted personnel to operate the vessel efficiently. The Zumwalt requires only 140 officers and enlisted, while the Navy's much smaller Arleigh Burke-class destroyers destroyer requires 323.

Still, as a design for a ship that can stand on its own in the 21st century, I think the Zumwalt falls short. Despite its shore-bombardment capabilities, the ship isn't designed for anti-submarine warfare and ballistic missile defense, as some of the Navy's Burke-class destroyers are.

As Pentagon budget cutters look for ways to save money, the Zumwalt as a target was an obvious choice.

Source: military aerospace. 15 September 2015

16 September 2015

Cylinder blast hurts 8 at Chittagong ship breaking yard:

- Gas cylinder blasts at Chittagong ship breaking yard

- 8 workers hurt

- Sent to Chittagong Medical College Hospital

At least eight workers of a ship breaking yard were injured in a gas cylinder blast in Sitakunda upazila of Chittagong this morning.

Identities of the victims could not be known immediately.

A gas cylinder of Shital Entreprise ship breaking yard exploded around 8:00am, our correspondent reports quoting Saiful Islam, assistant superintendent of Chittagong police.

Faulty cylinder might be the reason behind the blast, the ASP said.

Source: the daily star. 5 September 2015
http://www.thedailystar.net/country/cylinder-blast-hurts-4-ctg-ship-breaking-yard-138238

Waning demand for commodities sends cargo ships to scrapyard

As China’s slump deepens, it’s off to the scrapyard for a growing number of global cargo ships.

A drop in shipping rates amid the collapse in demand for coal, ore and other commodities has sparked a sharp rise in the number of ships yanked from the service and sold for scrap. Almost 6 per cent of the world’s fleet of ships that carry bulk commodities will be beached and sliced up for scrap metal this year, up from 2 per cent last year and topping the recent high of 2012’s 4.3 per cent, according to Clarksons PLC, a London-based ship broker.

“Business is good,” said Yogesh Rehani, director of operations at Global Marketing Systems Inc. (GMS), a buyer and recycler of ships. “The bulkers are a constant supply.” A closely watched measure of bulk shipping rates, the Baltic Dry Index, has fallen 21 per cent in the past 12 months, but is above a 30-year low touched in February. Prices for iron ore and Chinese imported coking coal have fallen 19 per cent and 50 per cent, respectively, in the past 12 months as factories in the world’s second-biggest economy slow down amid falling demand.

Demand for iron ore and coal is not expected to recover until 2017, London-based Drewry Shipping Consultants Ltd. says. “The depressed state of the dry bulk sector has led to doubts about the future of many ship owners and their ability to withstand prevailing market conditions,” Drewry said in a report on Wednesday.

“In dry bulk [commodities], the market is absolutely terrible,” said Erik Nikolai Stavseth, an analyst with Norway’s Arctic Securities AS.

Shipping companies that are taking deliveries of new vessels purchased many months ago in expectations that Chinese demand for raw materials would remain strong are now getting rid of their older freighters and downsizing their fleets. Scrapping ships gives companies cash, cuts expenses and helps support shipping rates by reducing the available global fleet.

“All the older vessels are not going out so because the rates are so poor it doesn’t make sense to run them,” Mr. Stavseth said in an interview from Oslo.

The net fleet size of dry bulk carriers is expected to grow by 2.5 per cent this year, compared with 2.2 per cent in 2014 and 3.3 per cent in 2013.

GMS’s Mr. Rehani would not say how many ships the company has bought and sold for scrap this year, but said the company has never been busier. Industry figures show about 100 of the largest bulk carriers, known as capesize, are expected to be scrapped in 2015, the highest since 2012’s record.
GMS sends ships for recycling at breaking yards in five countries, including Pakistan, China and Bangladesh.

A bulk carrier, which can weigh 35,000 tonnes empty and stretch longer than four hockey rinks, has scrap value of as much as $12-million (U.S.), based on recycled steel prices of $310 to $330 a tonne. GMS takes 3 per cent of that sale, a margin Mr. Rehani said has been falling in recent years amid stiff competition.

“It’s a very high-risk and low-return business,” Mr. Rehani said. “Most of the time the ships are operating and they are run up to the beach. If they are dead ships, then they are towed and pushed up on to the beach.”

Once beached, the vessel is set upon by workers armed with torches and cranes.

Much of steel is sold locally and turned into reinforcement bars used in construction, while the power generators are sold to hotels or companies in remote areas for back-up electricity, said Mr. Rehani, a former freighter captain. It can take as long as four months to cut up a ship. “All of the stuff, the wood, the machinery, the ceramics, is put back into service.”

The type of ship GMS sells for scrap is a handy barometer of the state of the global economy. In 2013, the company saw a flood of container ships as Chinese consumer demand faltered. This year, Mr. Rehani said the company has also seen a lot of petroleum tankers, after crude prices plunged by 50 per cent a year ago.

Source: Hellenic shipping news. 4 September 2015

15 September 2015

Hijacked tanker set for shipbreaking:

THE hijacked Indonesian tanker that has been left on the coastline in Barangay Cabuaya, Mati City, Davao Oriental since February this year is set for shipbreaking, according to the Philippine Coast Guard (PCG) in Southern Mindanao.

Coast Guard commander for Southern Mindanao Commodore Joselito F. dela Cruz, in an interview, said his office has coordinated with the Harbor Star Shipping Services, Inc. (which is located in Lanang, Davao City) to undertake the operation.

The MT Rehobot ship owner Well Titah and its insurer PT Asuransi Umum Bumiputera Muda (Bumida) have failed to retrieve the vessel, according to dela Cruz.

"Pinasa na namin yung bola sa salvage company. The Harbor Star, however, has also requirements before taking the operation. Naghihintay na lang sila ngayon ng go signal or certificate of abandonment from the owner," dela Cruz said.

"Ang mangyayari kasi kung sakali pumayag na yung owner or magbigay na sila ng certificate of abandonment, the Harbor will look for a buyer, ibi-bid yan before it will be broken. There are actually procedures on that," he added.

He said they have coordinated with Indonesian Consul General Eko Hartono on the matter, but the latter has yet to send his response.

The MT Rehobot, an Indonesian tanker, was hijacked off Lembeh Island, North Sulawesi, last January 28, and was abandoned in Cabuaya last February 19.

Dela Cruz said the tanker was carrying 1,100 metric tons of diesel fuel before this was hijacked. The PCG believes that the pirates transferred the fuel to another vessel before the MT Rehobot was abandoned in Mati.

What was left in Cabuaya coastline, dela Cruz said, is the main body of the tanker. He added that the tanker had been looted by some residents nearby.

"Though the vessel is free from oil spill, I will have to talk again with the Indonesian consul and the Harbor Star for the scrapping of the vessel," dela Cruz said.

Source: sun star. 15 September 2015

Greek and Russian companies still sold old vessels to Bangladesh breaking beaches:


Brussels – As of late, several shipping companies have already renounced selling their old ships to the of Bangladesh, as the working and environmental conditions are still unacceptable. Others continue doing so without any remorse. Recently two ships were beached at Shital: the “Arctic”, an LNG tanker whose last beneficial owner was the Russian state-owned tanker-giant Sovcomflot; and the “Aman Trader”, which was sold for breaking by Greek Universal Shipmanagement Corporation and was operated by Greek Enterprises Shipping & Trading S.A. The latter has also sold three ships for breaking to South Asia in 2015 and has been listed by the Platform as a “global dumper” in 2014.

„It is irresponsible of ship owners to continue to ignore what is happening in Bangladesh and to perpetuate a situation of exploitation and unsafe working conditions by choosing these yards to maximize their profits instead of demanding responsible ship recycling yards,“ said Patrizia Heidegger, Executive Director of the NGO Shipbreaking Platform.

At the same time – on 5th September – four workers died following a gas cylinder explosion in a shipbreaking yard in Chittagong, Bangladesh, a yard that was only established in 2011. The condition of four more workers is still critical, after suffering severe burn injuries in the blast. The eight workers were hit by the cylinder blast when they were getting ready for work. Accidents remain common in the shipbreaking yards of Bangladesh. According to information gathered by the NGO Shipbreaking Platform and its member organisations, in 2015 alone 12 shipbreaking workers have died on the job, and 17 more were severely injured. Last year, 17 shipbreaking workers died in Bangladesh, and at least 37 were injured. Explosions of gas cylinders, fires, steel plates crashing down in an uncontrolled manner and falls from heights are all too common risks for the shipbreaking workers of Chittagong.

And Muhammed Ali Shahin, coordinator of the NGO Shipbreaking Platform in Bangladesh, commented: „Continued lack of proper procedures, adequate infrastructure and equipment and sufficient training, are the root causes for such deadly accidents. We demand that all yard owners and the relevant authorities push for drastic change and ensure a safe and sound working environment in the yards. The yard management must be held responsible.“

The Daily Star, the leading English-speaking newspaper in Bangladesh, commented that “it is unacceptable that an industry as huge and risk-prone as ship-breaking should still be in such a primitive state that allows these horrible accidents to occur. The apathy and negligence demonstrated by employers violate basic labour laws that make it mandatory for workplaces to maintain minimum safety standards”.

Source: recycling portal. 15 September 2015

14 September 2015

Former CIA Spy Ship Hughes Glomar Explorer Sold for Scrap

An undated photograph of the Hughes Glomar Explorer. US Navy Photo

The owners of a ship used to execute one of the most world’s most complicated and expense pieces of espionage have sold it for scrap.

GSF Explorer — previously dubbed the Hughes Glomar Explorer — was sold to an unknown buyer by Swiss drilling concern Transocean for scrap, according to a Thursday report in Reuters.

The scrapping of the 51,000 ton GSF Explorer — repurposed in the late 1990s as an offshore oil exploration platform — is a coda of what could arguably be one of the most elaborate intelligence gathering missions in U.S. history.

Built as Glomar Explorer by the CIA, the ship was purpose built to recover the remains of the almost 3,000-ton Soviet Golf II ballistic missile submarine K-129 which was lost at sea in 1968.

Under the cover of belonging to eccentric billionaire Howard Hughes, the CIA undertook the covert operation Project Azorian to recover the the boat’s code books and nuclear missiles.

The mission was only partially successful when the failure of the complex claw mechanism designed to bring the submarine to the surface failed and a section of the boat broke off during the ascent to the ship.

The CIA’s cover was pierced by a 1975 report in the Los Angeles Times that broke the story of the ship’s covert purpose.

Still, few details of what the crew of Glomar Explorer recovered have been disclosed by the CIA.

Following the disclosure the ship was part of the Navy’s mothball fleet until its conversion and use by commercial interests.

Transocean did neither disclose the buyer nor the location of the scrapping but said in an April fleet status report the ship would be held for sale resulting in a $100-120 million write-down for the company.

The sale is a further symptom of offshore oil rig sales by drilling companies as a result of the current trend of low oil prices.

Source: US Naval Institute. 9 September 2015

Containership scrapping slows down to a trickle:

The total capacity of containerships scrapped from January to August this year has fallen to only 95,000 teu, compared to 323,000 teu in the corresponding period of 2014. Only 54 cellular containerships have been scrapped so far this year, with an average size of 1,765 teu and average age of 23 years. By contrast, a total of 130 ships were scrapped in the first eight months of last year, with an average size of 2,505 teu at 22 years.

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Steady demand in the second hand market has saved some of the older ships from the breaking yard. This includes tonnage initially intended to be sold to scrap buyers, but eventually acquired for further trading, taking advantage of the mini-recovery in the charter market earlier this year. In June, one such ship, the 1,055 teu CAPE SOUNION (built 1996), was even resold by a scrap buyer who had purchased her in December last year.

Despite earlier plans to recycle the ship, the vessel was subsequently retained for further trading before she was acquired by MSC. The fall in scrapping figures is also related to tumbling scrap prices, down from a high of $500 per light displacement ton (ldt) last year to only $320/ldt currently, while average charter rates are 30% higher so far this year. Illustrating this trend, of the 16 Hapag-Lloyd containerships (dubbed ‘Old Ladies’) that the company announced it was planning to dispose earlier this year, only five were actually sold for scrap.

The remaining 11 vessels were acquired for further trading. This included nine units aged 20 years or more, reflecting the continued market demand for older tonnage.

Source: Hellenic shipping news. 10 September 2015

Press Release – NGOs Denounce Dangerous Working Conditions After Four Shipbreaking Workers Are Killed

(Pictured: four of the eight workers hospitalised for their burn injuries sustained on 5 September)


Greek and Russian shipping companies had both sold old vessels to the shipbreaking yard


Brussels, 14 September 2015 - The NGO Shipbreaking Platform calls for urgent action to stop dangerous working conditions after four workers died following a gas cylinder explosion in a shipbreaking yard in Chittagong, Bangladesh. The condition of four more workers is still critical, after suffering severe burn injuries in the blast. The accident happened on 5 September 2015 at the Shital Ship Breaking yard, a yard that was only established in 2011 [1].

"This terrible accident and the deaths of the workers are painful reminders of the dangerous working conditions that are prevalent at the shipbreaking yards of Bangladesh," said Muhammed Ali Shahin, coordinator of the NGO Shipbreaking Platform in Bangladesh. "Continued lack of proper procedures, adequate infrastructure and equipment, and sufficient training, are the root causes for such deadly accidents. We demand that all yard owners and the relevant authorities push for drastic change and ensure a safe and sound working environment in the yards. The yard management must be held responsible."

According to the yard management, the eight workers were hit by the cylinder blast when they were getting ready for work, reported local media.

Three of the workers only received only basic care and were sent back home. Later they were admitted to the Chittagong Medical College Hospital when their condition had deteriorated. The five others were already being treated at the hospital; however, Khokon, Moksedul, Alamin and Shajahan succumbed to their injuries and died in hospital. Today, Nadim, Pasha, Abdur Rouf and Mannan are still fighting for their lives.

It was only after local NGOs, trade union affiliates and member organisations of the NGO Shipbreaking Platform, contacted the Bangladesh Shipbreakers Association (BSBA) that the workers received better treatment in the hospital. The Ship Breaking Workers Trade Union Forum and Platform member organisation BILS demanded proper care and treatment and reminded the yard owners about their obligation to provide compensation to the victims and their families. On 10 September, after three of the injured workers had already died in the hospital, activists and citizens formed a human chain in Chittagong to protest against the lack of response from the yard owners.

Even though several shipping companies have already renounced selling their old ships to the breaking beaches of Bangladesh, as the working and environmental conditions are still unacceptable, others continue doing so without any remorse. At the time of the explosion, two ships were beached at Shital: the “Arctic”, an LNG tanker whose last beneficial owner was the Russian state-owned tanker-giant Sovcomflot; and the “Aman Trader”, which was sold for breaking by Greek Universal Shipmanagement Corporation and was operated by Greek Enterprises Shipping & Trading S.A. The latter has also sold three ships for breaking to South Asia in 2015 and has been listed by the Platform as a “global dumper” in 2014 [2].

(Pictured: the human chain that took place on 10 September 2015 in front of the Chittagong press club)

"It is irresponsible of ship owners to continue to ignore what is happening in Bangladesh and to perpetuate a situation of exploitation and unsafe working conditions by choosing these yards to maximize their profits instead of demanding responsible ship recycling yards," said Patrizia Heidegger, Executive Director of the NGO Shipbreaking Platform.

The Daily Star, the leading English-speaking newspaper in Bangladesh, commented that “it is unacceptable that an industry as huge and risk-prone as ship-breaking should still be in such a primitive state that allows these horrible accidents to occur. The apathy and negligence demonstrated by employers violate basic labour laws that make it mandatory for workplaces to maintain minimum safety standards” [3].

Accidents remain common in the shipbreaking yards of Bangladesh. According to information gathered by the NGO Shipbreaking Platform and its member organisations, in 2015 alone 12 shipbreaking workers have died on the job, and 17 more were severely injured. Last year, 17 shipbreaking workers died in Bangladesh, and at least 37 were injured [4]. Explosions of gas cylinders, fires, steel plates crashing down in an uncontrolled manner and falls from heights are all too common risks for the shipbreaking workers of Chittagong.

CONTACT
Patrizia Heidegger
Executive Director
+32 2 609 9419
patrizia@shipbreakingplatform.org

NOTES

[1] See for example The Daily Star, the Dhaka Tribune and World Maritime News

[2] See p28 of our “global dumpers” 2013 list which we published in February 2014

[3] The Daily Star editorial can be read here

[4] These are the deaths the NGO Shipbreaking Platform and its member organisations are aware of.

The names of the workers who died in 2014 are
Babul Das, Md Jashim, Md Faruk, Md Arif Hasan, Gias Uddin, Sultan, Amjad Hossen, Saidur Rahman, Moshin, Md Mohiuddin, Sujon Babu, Uttam Nath, Afzal, Firoz, Asad Mia, Md Rafique, and Md Selim.

The names of the workers who died so far in 2015 are: 
Md. Gafur, Enamul, Saddam Hossen, Nuruddin, Robiul, Borhan, Ali Hossein, Md. Elias, Shahjahan.


Source: NGO Shipbreaking Platform