Scrapping over ship recycling

SHIP scrapping, or "recycling" as it has come to be more politely called over the past couple of decades, is a hot topic right now.

In a nutshell, there is an international agreement on environmental standards and certification for ship demolition yards which has not come into force because not enough countries have signed up to it yet. This agreement, the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships, 2009 (HKC), is now at risk because the EU has drawn up a regulation that goes further than the HKC.

The guidance issued with the EU Ship Recycling Regulation effectively rules out running a vessel up a beach at high tide and gradually pulling it ashore and breaking it up. That, more or less, is the way ships have been broken up for generations and is the way most of today's time expired vessels are recycled. The EU regulation implies that ships should be broken up in dry docks, a practice in very limited use and largely confined to Europe.

The vast majority of ships are broken up in Asia and many of those end up at Alang, India.

Incidentally using ship-sourced scrap is an environmentally friendly way of producing steel. At a recent seminar, Simon Bennett, general manager of sustainable development at The China Navigation Co noted: "It takes 60 per cent less energy to produce steel from sustainably recycling a ship compared to from iron ore. We strongly believe in sustainable ship recycling."

While the HKC is not yet binding, classification societies are already certifying demolition yards as complying with its standards. Japanese classification society ClassNK recently certified four yards at Alang while just this week, Italy-based RINA also announced that it had certified an Alang yard.

The European Community Shipowners' Associations (ECSA) says that it has recently returned from a study trip to Alang "to witness first-hand the important investments made in a number of ship recycling yards to ensure compliance" with the HKC. It says: "Heavy investments have been made to place concrete flooring, effective drainage systems, appropriate downstream management and more decent housing."

ECSA president Niels Smedgaard admits that Alang and other places in South Asia have for years been criticised for poor standards, "and rightly so", but he argues that a positive development has begun and this should be "supported not undermined".

However, some environmental groups are determined that the EU's effective band remains in place. They are now very cross that shipping giant Maersk has announced that it would continue to send ships for scrapping at yards on beaches, where they comply with Maersk's environmental standards.

The Clean Shipping Coalition (CSC), which brings together several environmental groups, said: "The Maersk Group's plan to avoid European environmental law on ship recycling by flagging ships to non-EU flags seriously undermines its credibility as a responsible ship operator."

John Maggs, senior policy adviser at Seas At Risk and CSC president, said: "Maersk is a European company and should abide by European laws. Suggesting that it might use a flag of convenience to escape EU ship breaking rules designed to protect the environment and worker safety is scandalous, and will seriously undermine its credibility as a responsible shipowner and operator."

CSC said that recent technical guidelines for ship recycling facilities issued by the European Commission make it clear that a beach is not an appropriate place for a high-risk heavy industry involving hazardous waste management. It added: "While only vessels sailing under an EU flag will be legally obliged to use an EU approved facility, the (Indian non-governmental organisations) have called for all shipping companies around the world with a responsible policy to use EU-approved facilities to show that they are recycling vessels responsibly."

So the call is for shipowners everywhere to forget about the HKC and do what the EU says.

CSC's attack has drawn a crisp response from the Danish shipowner. "The Maersk Group has had its responsible ship recycling policy since 2009 - and we have not lowered our standard or changed our policy following our engagement in Alang. The development in recent years in Alang have seen a number of certified yards capable of recycling to our standards. In our view, it is essential to support this development - and we do that most effectively by bringing our ships to be recycled responsibly in Alang. We consider our engagement an opportunity to change the industry for the better."

Maersk makes its view on the EU legislation crystal clear by saying: "The aim of the EU legislation should be to raise the standards where the vast majority of the world fleet is recycled. This is by no means accomplished by the suggested legislation as it fails to support the development and improvement we have witnessed in Alang. We strongly encourage the EU Commission to reconsider its position as an unfortunate consequence of the suggested legislation is the exclusion of the yards where more than 70 per cent of the world's fleet are recycled."

The Asian Shipowners' Association has called for the ratification of the HKC and is worried about an EU proposal to impose a levy on all ships entering EU ports to incentivise shipowners to recycle their ships according to EU standards.

With the EU once again imposing its own standards, the obvious impact is that countries outside the EU will see little point in ratifying the HKC. That would be a great pity as there would be less pressure on yards to improve standards. In fact, if the HKC does not become universally accepted, yards with low standards will be at an economic advantage. How can that be in anybody's best interests?