The ship recycling industry is facing a decisive year as EU's so-called whitelist of approved recycling facilities is being established at this moment. The list will come into force at the turn of the year. The composition of the list will be one of the focal points for the debates at the TradeWinds Ship Recycling Forum, which takes place in Hamburg today.
The EU must promote safe and sound recycling globally
The EU's whitelist of approved recycling facilities will be in focus in the coming period, as the European Commission has announced two new versions of the list in March and in the autumn, respectively. The current list does not provide the sufficient recycling capacity and should include the best Indian yards to support the positive development in Alang, says Danish Shipping.
"It is crucial to maintain the positive development in a country like India, where a substantial part of the world fleet is recycled every year. In this context, the EU's whitelist can be a great tool and act as a positive incentive. In addition to this, the current list has the practical problem that the capacity is insufficient, says Maria Skipper Schwenn, Executive Director at Danish Shipping.
EU does not have sufficient recycling capacity
Approximately 800 ships are being recycled worldwide every year. Nothing suggests that this development is about to change, therefore there is a need for recycling facilities that can handle the large number of ships in a safe and environmentally manner.
The EU's preliminary whitelist can handle only 12 pct. of the European flagged vessels being recycled every year. Looking at the size of the ships, the yards on the list can only recycle 9 pct. of the ships that are over 200 meters long.
Over time, the challenge will only increase as the trend is that ships are being recycled at an ever younger age.
Today, EU-flagged ships are recycled 5 years later than the global average of 33 years. It is expected that EU flagged ships will be recycled at a younger age. If age falls to the global level, the need for the yearly recycling capacity will increase from 2.5 million tonnes to 2.9 million tonnes. (LDT - Light Displacement Tonnage). This is the result of a calculation made by Danish Shipping.
"It is clear that the EU list is currently completely insufficient and that including yards outside the EU is a necessity. The European - including Danish – recycling facilities will be busy with small ships and in particular with obsolete drilling rigs from the North Sea, so they will not be challenged by this. For the big merchant ships it is crucial that they can be recycled at the best steel price without compromising on environment and safety," says Maria Skipper Schwenn, Executive Director at Danish Shipping.
The yards invest in improvements
22 yards outside the EU have requested to be included on the EU white list. This applies, inter alia, to a number of yards in Alang, and the process of assessing them is in progress, according to the European Commission.
In Alang, India, a number of yards have made important investments to improve the conditions in order to be included on the list. This is among other things due to Maersk's involvement in the area, which has had a positive influence. The outcome of the effort has yielded results that can now be measured, says John Kornerup Bang, Head of Sustainability, Strategy & Shared Value in Maersk.
"We are experiencing an impressive progress at the Alang yards with which we are working. Our external auditors registered between 52 and 82 faults and deficiencies in 2016, which are now remedied. It emphasizes that our involvement has a positive influence which can inspire and spread to other recycling facilities, so they not only compete on the price but also on sound standards," he says.
"The yards have, among other things, invested in cranes that can lift the steel blocks directly from the ship onto an impermeable surface - including the bow and the stern. This means that the steel blocks do not come into contact with water or sand at all," explains John Kornerup Bang.
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