Splash Extra

Beijing set to reverse ship recycling ban

Recent high level visit to the nation’s top demo yard sparks hope of a policy U-turn

China is looking at reopening its ship recycling yards to foreign owners from as early as next year.

Chinese shipbreakers have not been allowed to handle foreign ships since a ban came in place in January 2019 as part of president Xi Jinping’s environmental protection efforts, which have seen a long list of waste products barred from entering the People’s Republic in recent years. However, following extensive lobbying, a U-turn on the policy is deemed likely, giving international owners once again access to some of the greenest demolition facilities in the world, where ships are taken apart alongside rather than beached.

A high level Chinese delegation recently visited Changjiang Shipbreaking yard, China’s best-known demo site, with sources telling Splash Extra that a decision to allow foreign ships back in could come by the middle of next year.

“President Xi has been on a big drive to improve environmental standards across China, so it may take a little more time until any green light is given, especially given the many layers of bureaucracy that exist in China,” commented Jamie Dalzell, a senior trader for cash buyer GMS.

Bernard Veldhoven, secretary general of the International Ship Recycling Association, told Splash Extra it would be useful if Beijing could give a public signal of its intention to reverse the ban soon.

“The impact of that decision will potentially be enormously important as a huge recycling capacity can be added to the present international capacity and the alternative for the beaches in Indian subcontinent,” Veldhoven said, adding that the European Union ought to be able to get both Changjiang Shipbreaking and Zhoushan Changhong International Shipyard quickly certified onto its green list of demo sites.

Xie Dehua, director of the China National Ship Recycling Association, said he was hopeful that the government has had a change of mind on its ship recycling position. Xie’s members have had to focus on just Chinese-flagged ships for the last two years.

Hitesh Vyas, vice president of cash buyer Wirana Shipping, put the chances of a change in China as 50:50 next year, but almost 100% guaranteed by 2022.

Vyas revealed that four Chinese ship recycling yards have submitted applications for EU certifications and more applications are expected to follow.

“These yards will be quickly approved. This will also give EU-flagged shipowners more options to recycle their ships and we would not have a situation as seen with EU-listed yards in Turkey, which have a waiting list to be recycled,” Vyas said.

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