Alang Steel Rates
Alang is situated in Bhavnagar district, Gujarat and is the biggest ship breaking yard in the world. On a yearly basis, Alang shipyard has the capacity to dismantle 450 ships. The ships that are broken down in Alang are often repurposed and used in construction and other industries. The construction sector makes maximum use of the repurposed material from ships scraped at Alang with almost 70% of ships broken down in Alang getting converted in bars and rods and then this steel being used in the construction sector.
Ship Recycling and Steel
Ship recycling produces a tonnes of scrap steel metal. This scrap is then used in the country’s steel production units to develop new goods like rods and bars, heavy equipment and more. The re-rollable steel thus affects the rates of steel trading significantly. The scrap metal industry also acts as an employment venue for thousands of people, those who work in the ship breaking yards as well as those who work in the re-rolling steel mills.
In Alang, the biggest beaching unit of the world exists and this employs close to 66,000 yard workers. The beach at Alang has a natural incline that makes it easier to dock ships so much so that they appear to be directly docked on the sandy beaches during low tide.
The ship breaking yards of Alang are situated in the Gulf of Khambat. This falls about 50 Kms away from Bhavnagar. Large ships, container ships, supertanker ships, ocean liners and car ferries are all docked in the beach during high tide. Once the water recedes, workers start work on beaching the ships. Steel, crockery, furniture, electrical cables, small motors, generators, navigation equipment are some of the resulting products that are then sold to other industries in and around Alang.
Demand for Steel
The demand for steel from the steel industry drives the existence of the steel scrap or other metal scrap markets. India has seen a construction boom since the 90s and the construction industry is the main consumer for re-rollable steel. Power deficiency also makes using re-rollable steel a viable option when compared to new steel. Typically, ship plates are re-rolled in bars, rods and angels without melting thus saving costs significantly.
Scrap steel is fast emerging as an alternative to iron ore and this factor too drives the demand for steel from ships. Ship beaching is a very labour intensive job and cheap labour in India makes it possible for Indian markets to sustain steel activities that are dependent on ship breaking.
Steel trading prices from Alang are quite influential as Alang produces a lot of steel annually. Scrap ships are traded as a commodity with smaller ships selling at a higher price than bigger ships due to the easy nature of dismantling them. India, also typically buys ships which have a higher percentage of steel used in their construction than other metals. Every year, many ships are beached at Alang and later scraped.
In 2011-12, 415 ships were scrapped in Alang. The world’s largest ship, Seawise Giant was also scrapped in Alang in the year 2009. Annually, Alang carries a capacity of producing 4.5 million ton re-rollable steel with a turnover of about 6000 to 7000 crores.
Alang has 167 ship breaking yards spread over a distance of 10 kilometers and due to collaboration between the Japanese and India governments, there are measures being taken to make Alang the largest ship breaking yard in the world that complies with International Maritime Organization’s recycling laws.