Alang-Sosiya Shipyard Sees Increase in Ship Recycling for FY26
MUMBAI: The Alang-Sosiya shipyard in Gujarat’s Bhavnagar district, recognized as the world’s largest ship-breaking facility, has reported a slight increase in ship recycling activities for the fiscal year 2026 (FY26). A total of 119 ships were beached for recycling, marking a modest rise from the previous year’s figures. The total Light Displacement Tonnage (LDT) for these vessels reached 10,874,47.01 tonnes. This increase comes after FY25, which recorded the lowest number of ships beached in a decade, with only 113 vessels and an LDT of 10,061,99 tonnes.
Among the ships recycled in FY26, 24 were classified as sanctioned vessels, commonly referred to as the “dark fleet.” These ships accounted for 31.72% of the total LDT, weighing in at 3,45,021.59 tonnes. The breakdown of the 119 ships included 25 general cargo ships, 46 tankers, 15 bulk carriers, nine reefer vessels, eight container ships, eight LNG vessels, two offshore units, two pipe-laying barges, and one each of tug, LPG, fish factory, and passenger ships.
The increase in ship recycling at Alang-Sosiya is attributed to a shift in market dynamics, with more ship recyclers opting for sanctioned vessels due to a decrease in the availability of regular ships and the price differences between the two categories.
Challenges Facing the Ship Recycling Industry
Despite the uptick in ship recycling, industry experts highlight ongoing challenges that continue to affect operations at Alang-Sosiya. High freight rates have incentivized fleet owners to retain older ships in service rather than selling them for dismantling. Additionally, geopolitical tensions, particularly the ongoing conflict in Iran, have made older and sanctioned vessels more profitable to operate, further reducing the number of ships available for recycling.
Alang-Sosiya Ship Recycling Sees Modest Increase in Activity for FY26
According to a report by Global Marketing Systems Inc (GMS), the world’s largest cash buyer of ships for recycling, the structural challenges at Alang remain significant. The report notes that there is insufficient workable tonnage arriving at the shipyard, leading to underutilization of its facilities. While some smaller regional cargo vessels have recently arrived, the larger units that are crucial for generating revenue remain scarce.
Furthermore, recyclers in India are currently offering the lowest prices in the subcontinent, despite rising local steel and scrap prices. Energy shortages affecting steel mills have dampened local demand, adding pressure to the market. Competitors in Bangladesh and Pakistan are showing stronger pricing signals, which could lead to a shift in ship owners’ preferences away from Indian facilities.
Industry leaders emphasize that while India has the necessary infrastructure and compliant yards for environmentally safe ship recycling, the pricing dynamics must improve to attract more vessels. The ongoing geopolitical pressures, including currency fluctuations and energy disruptions, are complicating the situation further. As the market evolves, recyclers and ship owners must navigate these challenges to ensure a sustainable future for the ship recycling industry in India.
