The Jiangsu Yangzijiang Shipbuilding company in China has branched off from building to destroying ships in response to the saturation of its shipbuilding business, according to a report on Lloyd’s List today.

But according to the report, the Chinese Government is still to grant it a licence for scrapping ships.

The company plans to be one of the top three ship demolition companies in China, Yangzijian Shipbuilding Holding chairman Ren Yuanlin told local media, including Lloyd’s.

In the last six months, China’s ship scrapping industry demolished 1.5 million dwt of vessels – the same amount seen in the last four years in the local industry.

Old vessels are not needed during the shipping downturn, and in China many ships planned for demolition make their way to Jiangsu – a major ship demolition hub.

Yuanlin said that Yanzijian plans to have its demolition business operational by the end of next year, and that following this it believes revenues could rise to CNY10bn.