Japanese conglomerate Sojitz Corporation is funding a Dutch startup that aims to revolutionize the ship-breaking process, it announced.

Circular Maritime Technologies International (CMT) is collaborating with metals recycling firm Jansen Recycling Group to develop new technology that aims to automate, accelerate and reduce labor needs in the shipbreaking process.

"By increasing the number of shipbreaking yards that comply with Europe’s strict environmental regulations and efficiently recovering high-quality scrap steel, Sojitz, CMT, and Jansen aim to contribute to the steel industry’s ongoing transition to the use of large-scale electric arc furnaces to achieve low-carbon manufacturing of steel products," the Japanese giant wrote.

Many large-scale cargo vessels built during the economic boom of the early 2000s are expected to reach the end of their working life in the coming years, but Sojitz notes there is a lack of international shipyards that meet environmental standards for ship recycling globally.

This has raised concerns of severe bottlenecks in ship-breaking developing over the next decade, with the majority of ship-breaking yards in India and Bangladesh not meeting EU environmental and labor requirements.

The global steel industry has also set a target of achieving carbon neutrality by 2050 and is working towards decarbonization of the steel manufacturing process, which will mean much greater dependence on scrap steel. 

CMT itself was created in 2022 with the goal of resolving both issues, Sojitz said.

"Co-funded by the European Union, CMT is developing a technology that aims to facilitate the efficient recovery of high-quality, low-impurity scrap steel in line with the strict European recycling standards," the conglomerate added.