China COSCO proceeds with scrapping plan regarding 14 old vessels

By Finance

China COSCO Holding proceeded with its fleet scrapping plan for February-Match regarding the dismantling of one container vessel and another thirteen bulk carriers.

According to an April 14th company stock filling, the vessel scrapping procedures accounted for loses in the rough amount of CNY72 million (USD11 million).
The vessels dismantled in the process were the Da Qing He container feeder (constructed in 1996), along the thirteen bulk carriers mentioned above with tonnages in range of Handymax-Panamax with an age from 25 to 30 years respectively.

The total capacity of the 14 vessels was pinpointed to be 924,700 DWT.

China COSCO proceeds with scrapping plan regarding 14 old vessels

The company has commented the plan by saying that after undergoing the scrapping of the vessels, the average age of its fleet has been reduced and it also contributed a great deal for boosting the fleet’s overall operating competitiveness by increasing fuel savings along with environmental protection levels.

By adding in the ships scrapped in February and March, the total number of dismantled vessels accounted for the first three months now amounts to six container vessels and 16 bulk carrier ships.

Back in January, the company announced plans for scrapping another 23 vessels with a total of 1.1 million DWT, which have been scheduled for 2015.

In 2014, China’s government initiated several policies regarding the provision of subsidies in order to encourage and stimulate Chinese ship owners to scrap their old vessels. According to some stipulations if a ship owner is to order tonnage at China-based shipyards that match the previously scrapped tonnage his subsidies are to be doubled.

Source: COSCO