Ship Recycling Market Remains Stagnant

The ship recycling market has remained stagnant over the past week. In its latest weekly report, Best Oasis (www.best-oasis.com), a leading cash buyer of ships said that “in India, the market remains stable, with the situation expected to persist until early September, aligning with the end of the monsoon season. The availability of various scrap options is putting pressure on the demand for ship steel scrap. In Bangladesh, the market continues to decline due to the monsoon season and low local demand, with recyclers awaiting further stabilization before making offers. Pakistan’s market remains unchanged following the imposition of a new additional import tax on vessels, which has made other imports slightly more competitive. Türkiye sees no change in local market prices, with a slight improvement in import values”.

According to Best Oasis, “despite these challenges, the Indian market remains comparatively strong, free from LC problems and maintaining more favorable rates than its counterparts. The slowdown in China’s real estate and construction sectors has slashed domestic steel demand, compelling Chinese steelmakers to target new markets, especially in Latin America. This shift has resulted in Chinese steel being sold at below-market prices, creating a dumping crisis that jeopardizes local industries. In response, Mexico, Chile, and Brazil have ramped up tariffs on Chinese steel imports, with more countries expected to follow suit.

The Latin American Steel Association has warned that this surge of cheap Chinese steel is stifling local production, leading to halted operations and risking deindustrialization. The influx of low-cost Chinese steel not only undermines quality and environmental standards but also heightens trade tensions, as retaliatory measures from China loom. This situation also poses challenges for the Indian steel sector, amplifying global market disruptions”, the report concluded.

In a separate report, shipbroker Banchero Costa said that “the Summer ‘status quo’ continues across the Subcontinent demolition markets this week. While a hand full of Vessels have been committed in recent weeks these have nearly all been of a very vintage nature and sub 5,000 ldt making it hard to gauge where exactly prices lie. However, there is little doubt that along with steel plate prices, sentiment has become increasing uncertain which has been reflected in less aggressive offering on what limited tonnage there is. Earlier this year, the market had whispered the magical $600 lt/ldt for the right Vessel (container) at the perfect time however those days are long gone. Historically, and it should be noted in a very similar pattern to last year, prices generally do cool over these quieter summer / monsoon months before leading into what is normally a better final quarter of the year”, the shipbroker concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide