News / Safer shipbreaking a reality after Bangladesh signs up to HK convention

The Hong Kong Convention on shipbreaking has entered into force, following its ratification by the world’s joint-largest shipbreaker, Bangladesh.

Good news for workers, the convention (HKC) includes specifications for how scrapyards are to dismantle vessels, including inventories of potential harmful substances onboard, including asbestos, heavy metals and volatile organic compounds, as well as ensuring prompt emergency medical care.

The history of practices at facilities in Bangladesh, India and Pakistan has not been a proud one, with vessels being run onto beaches and dismantled from underneath, with no regard for the safety of workers, many of whom have been killed.

An industry source told The Loadstar: “The HKC will drive standards forward for all ship recycling, which is long overdue – although it must be acknowledged that a lot of progress has been made over the 14 years since this journey began.

“Bangladesh, India and Pakistan, along with Turkey, account for the majority of ship recycling. More than 90% of the yards in India are already compliant with the HKC, as are a handful of yards in Bangladesh. As more there get certified it will have a real impact as this will bring significant green recycling capacity online.

“Sadly Pakistan has no yards that are compliant, but hopefully ratification of the convention will give yard operators enough of a business case to push ahead with certification.”

In recent years, the high spread between how much cash buyers are willing to pay for scrap vessels and the cheap labour costs of scrapping have meant shipowners have chosen to scrap vessels early and replace them with newbuilds that meet environmental regulations. A recent driver was the IMO’s  fuel sulphur content cap, which prompted some owners to scrap vessels rather than have them retrofitted with a scrubber.

But a higher cost of scrapping might lead to a rethink. Peter Sand, Xeneta chief analyst, said he expected it would extend the life of ships in the long term.

“Containerships are some of those that can trade for the longest time. If you need to pay a high cost or you do not receive money from the sale of the ship, then you will probably choose to postpone recycling the ship.”