GMS Week 52 – FACING THE MUSIC!

As 2019 closes and the watershed year of 2020 comes into view with the increased price of low Sulphur fuel (or installation of scrubbers) that is set to affect the bottom lines and OPEX rates of Ship Owners the world over, it is set to be a busy few years ahead for the various ship recycling destinations. That we have yet to see an increase in scrap tonnage, says much about the improved freight rates witnessed across all sectors over the course of this year.

However, as we inch closer towards the end of 2019, it has been evident that an increased flow of tonnage for recycling could start to hit the market, with many owners fearful of what lies beyond January 1st, 2020, particularly for their older vessels that are unlikely to pass drydock or special surveys.

Meanwhile, after the peaks seen well into and above the mid USD 400s/LDT in the first half of the year and a subsequently turbulent mid-year that saw prices drop by about USD 100/LDT, subcontinent recycling markets have maintained an overall positive footing.

The overall supply of tonnage remained low as we witnessed drastic mid-year declines and markets (including a previously non-existent Pakistan) seem positioned to take advantage of the current situation with decent demand and a ship owning community that is finally ready to face the music at the current rates.

This week, even though the INR weakened once again, Indian steel plate prices have been on an upward trajectory for several weeks now and even recorded the most noteworthy jump, resulting in India taking the mantel from Bangladesh in the final stretch of 2019. In the other major markets i.e. Bangladesh, Pakistan and Turkey, the overall market condition remains unchanged since last week, with demand and prices still buoyant as the year winds down.

For week 52 of 2019, GMS demo rankings / pricing for the week are as below.

Source: GMS Weekly