TThe ship recycling market has remained weak over the past week. In its latest weekly report, the best oasis (www.best-oasis.com), a major cash buyer of ships, said, “The Indian ship recycling market remained weak during the week, with weak domestic demand for finished products continuing to weigh on overall sentiment. Domestic steel prices have shown some stabilization; however, current levels are expected to be temporary as demand for finished products remains weak. Market activity may decline further in the coming weeks as weak domestic demand for finished products is expected to continue to limit market momentum. Two Indian recycling yards have been recommended for inclusion in the EU list. Priya Blue is not included in the Latest recommendations; however, there is optimism that easing may be considered in the next round.”
Source: Best Oasis
Best Oasis added, “The Bangladeshi ship recycling market remained steady during the week, with buyers continuing to show strong interest in acquiring additional vessels. Domestic market activity remained relatively subdued; however, buyers’ appetite for recycling candidates remained healthy. Prices remained steady, supported by sustained buying interest despite limited momentum in the local market. The Pakistani ship recycling market remained buoyant during the week, with buyers actively searching for suitable recycling candidates. Medium-sized vessels in the 7,000 to 7,000 range continue to hold steady.” 10,000 LDT in Action While Pakistani buyers are still unable to match the pricing levels offered by Bangladesh, market confidence remains supported by limited steel availability, with lower supplies from Iran expected to provide support to the local recycling market. However, concerns are rising over the broader economic outlook, as a sharp increase in fuel prices over the past eight to 10 days is expected to fuel inflation and could impact market sentiment in the near term. Domestic steel prices rose by around US$4-5 per tonne, despite rising values. Steel, ship prices remained unchanged as buyers continue to maintain a generally cautious approach, although the increase in steel prices has not yet translated into stronger ship prices.
Meanwhile, in a separate report this week, shipbroker Intermodal commented: “At Alang, the market was muted last week amid tepid demand, while rising energy prices and the weakness of the Indian rupee against the US dollar weighed on sentiment. However, the backdrop in the steel market is supportive, with steel plate prices rising, mainly driven by tightening supply, as steel processing operations shrink due to the monsoon. Finally, on the policy front, the proposed listing of two facilities at Alang is a positive signal towards the opening of the first approved channel For EU flagged recycling candidates to be directed to the Indian market Bangladesh is emerging from a period of deadly monsoon floods that affected economic activity, with the ship recycling sector recovering in parallel, with operations at yards and steel mills resuming.
Source: Intermodal Shipbrokers
Despite limited activity, buying interest remains good, particularly for bulk carriers, although the recent case of a tanker being approved after clearance but before beaching has made buyers more hesitant and increased demand for payload compliance. Overall sentiment is positive, supported by expectations that candidates who delayed during the monsoon period will be offered to the post-monsoon market. Conditions at Gadani Center remained broadly unchanged, characterized by a limited pool of candidates and a healthy buying appetite. The steel market is supported, with prices rising on the back of supply constraints, as bad weather associated with the monsoon continues to disrupt factory operations. There is optimism that easing government taxes on real estate transactions and supporting affordable housing will boost construction activity, and hence steel demand, once the monsoon ends. Meanwhile, news of an upgrade in the country’s credit rating, on the back of foreign capital inflows, added to the positive sentiment. In Türkiye, despite improving conditions in the steel market, activity remains steady as buyers maintain a wait-and-see stance amid a limited number of candidates and further weakness in the local currency.
Nikos Rousanoglou, Global Hellenic Shipping News
