“If you look at the demolition market, last year I think the youngest tanker that was sold on the VLCC side was 12 years old and while this didn’t shock everyone, it certainly surprised some people in the market who hadn’t been around that long, to see a 12-year-old VLCC get scrapped,” said Sebastian Davenport-Thomas, managing director of Braemar Seascope.
“Ships may be much younger than 20 or 25 years old before going to scrap nowadays,” he added.
Denis Petropoulos, Braemar Seascope’s executive director and regional group director (Singapore), noted that 12 is quite a rare age for a vessel to be scrapped in the current market, particularly compared to shipping’s struggles 30 years ago.
“Though 12 is unusual now, that was the average age of tankers being scrapped in the 1980s, during the worse point in shipping – the average! That number has stuck with me,” Petropoulos recalled.
Braemar Seascope pointed out that demolition is increasing with 44m tonnes sold for scrap globally in 2012, up 80% from the previous year.
James Kidwell, chief executive of Braemar Seascope, said: “I think if you look at demolition trends, relative to the last big newbuilding boom in the early 1980s, the tanker fleet halved back then, so you might argue that the level of demolition now is relatively small compared with 30 years ago. But we are living in a credit crunch and one of the major drivers is that tankers approaching their special survey are being sent for scrap.”
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