Ship Recycling May Double in 10 Years? The Future of the Hong Kong Convention and Maritime Industry

Today, let’s explore the slightly technical topic of “end-of-life ships”.

Ships, like any machine, have a lifespan, and ultimately face “scrapping (recycling)”. Reports suggest that the number of ships dismantled could double over the next decade.

This article covers:
Why is ship scrapping increasing?
Where are ships dismantled?
What are the environmental impacts and business opportunities?

Why is ship recycling gaining attention now?

The trigger is the Hong Kong Convention, which takes effect in June 2025.

This treaty requires ship dismantling to be done in a safe and environmentally sound manner.

In other words, we’ve entered an era where even the end of a ship’s life must follow international rules.

BIMCO Forecast: Scrapping May Double or Triple

According to BIMCO (Baltic and International Maritime Council), Ship scrapping in the next 10 years is expected to be about twice the number of ships and three times the tonnage compared to the past decade.

It may even exceed the record high of 2012 (about 1,800 ships and 60 million DWT) on a yearly basis.

1. Retirement Rush of Aging Ships

Ships built during the 2008–2010 shipbuilding boom are nearing their 20-year lifespan.

Especially older bulkers and tankers may soon be headed for scrapping.

2. Stricter Environmental Regulations

With enforcement of EEXI and CII regulations, shipowners are phasing out fuel-inefficient vessels and replacing them with more efficient ones.

3. Recycling Infrastructure is Concentrated

About 86% of ship recycling by weight takes place in Bangladesh, India, and Pakistan.

The market for scrap steel and dismantling yards is heavily concentrated in South Asia.

4. Pressure from Newbuild Replacements

The market is booming, and new fuel-efficient ships are rapidly being introduced, accelerating the retirement of older vessels.

5. Regulations by the EU and IMO

In the EU, dismantling at EU-approved facilities is mandatory.

Globally, investment in certified yards will be inevitable.

A particular challenge is the shortage of yards compliant with the Hong Kong Convention.

Is Ship Recycling Becoming Profitable?

As eco-friendly recycling grows in demand, operating certified yards, scrap steel trading, and reusable materials businesses have significant growth potential.

Conclusion

We’re entering a decade where ship scrapping will double.

With the enforcement of the Hong Kong Convention, ship recycling has moved from being a behind-the-scenes process to a matter of global rules and economic importance.

“Build, Operate, Retire”—we must now consider the full lifecycle of a vessel.
Ship recycling is becoming an essential topic in logistics and maritime discussion.