Demolition Activity On “Holiday Mode”
In a separate note this week, shipbroker Allied Shipbroking said that “another good week for the ship recycling market, with a fair number of units being concluded for scrap. In the Indian Sub-Continent, Pakistan remained the leading demo destination for yet another week, with offered numbers being on the rise. Whether these new price levels will be sustained remains to be seen. A lot will depend on tonnage availability in the near term, as well as, how the other main competitor destinations react. At this point, Bangladesh is still lagging well behind, seemingly unable to compete during this upward momentum noted in scrap prices. If it is manage a strong comeback, this will most likely take place later in the summer period. In India, the situation seems to be a bit more blurred for the time being, given the problematic situation developing as part of the Covid-19 pandemic. Hopefully, given the improving local steel plate prices, overall sentiment as well as the lack of tonnage availability, we may well see a strong push from the side of breakers take place at some point. Finally, Turkey seems to still be on a recovery path, though here too we are seeing some signs of possible disruptions taking place in the near term as part of the COVID-19 pandemic”, Allied said.
Meanwhile, in its latest weekly report, GMS, the world’s leading cash buyer of ships said that “Pakistan has been and continues to surge ahead of its sub-continent competitors in recent weeks, with some astounding numbers being tabled. This week, it was no different with another couple of rather high-priced bulker sales being confirmed to Gadani Buyers. Despite the prices on show, there has been an ongoing slowdown in the availability of tonnage for sale for recycling and given the closure of the recycling markets for a few months early in the year (which only added to the diminished level of recycling activity), the overall situation may be contributing to some of the desperate speculative numbers being seen from Cash Buyers and various End Buyers alike (especially in Pakistan). As such, India and Bangladesh still remain stranded some ways behind their Pakistanicounterparts and there is the feeling that once some of the more serious demand from the few Gadani Buyers is satisfied, prices may start to rapidly cool down to some more realistic / reasonable levels. Meanwhile, there is growing evidence that prices from India & Bangladesh will start to firm again, with increasing enquiries and some higher overall indications / offers on any of the minimal number of units that may be heading the way of these two markets, such is the current form from Pakistan at present. Overall, following the decline of almost USD 150/LDT seen in the wake of the Coronavirus pandemic, it is therefore expected to be a busier and more bullish fourth quarter of the year. India is of course still struggling with the third highest case count of Covid-19 in the world and it is becoming an increasingly difficult virus to contain with outbreaks at various ‘as is’ take over locations (including Hong Kong), increasing spikes in Europe once again, and the never ending situation in the U.S.”, GMS concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide