TThe ship recycling market has been softer over the past week. In its latest weekly report, the best oasis (www.best-oasis.com“The Indian market registered a modest correction this week; however, this should not be seen as a sign of stronger sentiment but rather an adjustment in the market following an earlier sell-off of expensive vessels,” a leading cash buyer for vessels said. The key development this week was the Recycling Association directing yards to introduce loading charges, while also asking recyclers to restore a stricter payment system, with mills expected to settle on a next-day basis or within a maximum 10-day credit period, after payment cycles eased during the geopolitical While these measures are expected to improve liquidity for ship recyclers, additional loading costs and a tighter payment structure may put pressure on buyers and downstream mills. As a result, the local market may face some short-term weakness in the coming week as participants adjust to the revised trading framework and assess its impact on margins.
Source: Best Oasis
According to Best Oasis, “The Bangladesh market eased slightly this week, with domestic prices declining on a daily basis. Despite the weakness in the domestic market, interest remains evident in medium-sized assets, which continue to represent the preferred tonnage of buyers. Bangladesh remains the highest-grossing recycling destination compared to other major markets, supporting continued buyer interest. The Pakistani market remained steady this week, with buyers actively searching for vessels and overall sentiment remaining strong. Domestic market conditions continue to support prices, particularly due to a lack of available supply,” she concluded. Best Oasis said: “This shortage has added strength to buyer sentiment and kept the market relatively positive compared to other destinations. Finally, the Turkish market remained quiet over the past week, with limited activity and very few transactions reported. Market sentiment remains cautious, while trading levels remain weak. Looking ahead, it remains difficult to predict the market direction due to domestic political uncertainty, regional geopolitical tensions and the continued devaluation of the Turkish lira.”
In a separate report this week, shipbroker Intermodal said that “most ship recycling centers saw sluggish activity in the post-holiday week, affected by the holiday lull. India’s recycling market lost steam last week, with continued weak steel demand in downstream industries limiting buying confidence in Alang. Although recyclers remain interested in securing tonnage, their appetite is price sensitive, while the lack of new offers has kept activity subdued. The domestic steel market also remained subdued. Under pressure, with soft plate levels strengthening Measures to tighten payment discipline and the introduction of loading charges may improve yard liquidity, but may also lead to some short-term friction across the domestic steel chain In Gadani, the market has resumed at a good pace after the Eid al-Fitr slowdown, with buyers showing active interest in viable candidates, the main constraint remains limited tonnage availability, which has kept the market on a steady footing.
Source: Multimedia
The expected addition of more Hong Kong Council approved yards will also enhance Pakistan’s competitiveness in the field of ship recycling. Meanwhile, the domestic steel sector appears to be in a wait-and-see mode, with participants looking forward to the national budget announcement and potential steel-intensive infrastructure projects. The recycling sector in Bangladesh has finally lost some momentum with activity declining as yards gradually resumed operations after Eid. Buying interest is predominantly for medium-sized units, while the market continues to benefit from its competitive position within the Indian subcontinent, making Chattogram an attractive destination for candidates. The domestic steel market also remained sluggish, weighed down by the holiday slowdown. As in Pakistan, attention now turns to the announcement of the national budget and public spending plans. In Turkey, ship breaking activity was limited after Eid, while most shipyards appear to have at least one unit under demolition, reducing the urgency of chasing new candidates. Intermodal concluded that the steel market was flat but lacked a clear direction after the holiday break.
Nikos Rousanoglou, Global Hellenic Shipping News
