Industry monitor Clarksons Research noted in a recent report that the shipping industry could address the current over supply issue with vessel recycling to bring the market back to healthy levels.
The firm noted that since the start of 2009, a total of 200 million gross tons of shipping capacity has been scrapped for recycling, compared to the 63 million gross tons in the seven years prior to 2009.
Further, this total includes 95 million gross tons of bulk carrier tonnage and 29 million gross tons of container ships, which have helped address the issue of oversupply in shipping markets, Clarksons pointed out.
Additionally, Clarksons said the industry could keep the momentum going, at least in today’s terms, with sustained recycling.
“The statistics tell us that around 75 million gross tons in the fleet is above the current average age of scrapping, 6% of the world fleet. At 2016’s rate of demolition, that’s another 2.4 years’ worth. And given the age profile of the world fleet, after another 2 years an additional 21 million gross tons will have crossed the current average age mark and after 5 years another 77 million gross tons,” Clarksons noted.