Alang Ship Recycling Industry Faces Severe Downturn Amid Red Sea Crisis

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  • The ship recycling industry in Alang, Bhavnagar, is experiencing a significant downturn, marked by dwindling ship arrivals and competitive challenges.
  • The ongoing Red Sea crisis, coupled with high freight rates and competitive recycling rates in neighboring countries, has intensified the industry’s struggles.
  • Ship recyclers are calling for government support and exploring adaptation strategies to navigate through this challenging period.

Impact of the Red Sea Crisis

The Red Sea crisis, triggered by Houthi rebels’ missile attacks on container ships, has disrupted shipping routes and led to increased freight charges. As a result, many shipping firms have suspended operations or diverted vessels, significantly reducing the number of ships available for recycling in Alang. The crisis has prolonged journey times and exacerbated the industry’s downturn.

Competitive Recycling Rates and Market Dynamics

Ship recyclers in Alang face stiff competition from counterparts in Bangladesh and Pakistan, which offer higher recycling rates. This disparity in rates, combined with declining prices for melted scrap, has diminished Alang’s capacity to purchase old ships and maintain competitiveness. Moreover, the delivery of new ships has not improved, further constraining the availability of vessels for recycling and impacting the industry’s viability.

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Source: Times of India