Ship Recycling Market Sees Steady Flow of Ships

The ship recycling market has seen a steady flow of vessels over the course of the past week, mainly from the container and dry bulk segments.

In its latest market report, Best Oasis (www.best-oasis.com), one of leading cash buyers of ships worldwide, said that “the recycling market across various regions exhibits varying trends and challenges. In India, the market is experiencing a robust upward trajectory, driven by strong local demand and a consistently healthy demand for steel, which bolsters the market’s overall health and maintains its growth. Conversely, in Bangladesh, market demand remains tepid and unchanged, displaying a lack of aggressiveness. Additionally, the Central Bank of Bangladesh’s adjustment of the Taka’s value complicates financial transactions, affecting the recyclers’ ability to arrange LC at a favorable rate. Pakistan’s recycling market is facing a period of stagnation, with no significant activity or momentum, making it difficult to predict when the market might pick up again”.

Similarly, according to Best Oasis, “Türkiye’s market also shows no significant changes from the previous week, maintaining a steady state in market activities. China’s steel industry is currently facing significant challenges due to overcapacity, signaling a potential end to its era of dominance. Despite an increase in steel production, a downturn in the property market and a slowdown in infrastructure spending have led to a steep plunge in prices.

These factors collectively contribute to heightened concerns that the sector may be on the brink of a severe downturn. Moreover, international reactions have intensified, with Washington calling for higher tariffs on Chinese steel imports, Chile making moves to curb shipments, and Vietnam considering a probe into the imports. The situation poses substantial risks not only domestically but also in terms of international trade tensions, underscoring the need for strategic adjustments in the industry”, Best Oasis concluded.

Meanwhile, in a separate note, shipbroker Banchero Costa added that ‘with a steady flow of container Vessels and the occasional bulk carrier in the mix, the sub-continent demolition market continues show encouraging signs despite a major correction of the Bangladeshi currency (Taka) to the US Dollar, which lost about 6%. While this was not unexpected due to terms of an IMF loan agreed at the start of the year it will make Vessels more expensive for end Buyers raising a Letter of Credit in US Dollars. However the impact seems to be minimal with Cash Buyers still bullish in taking positions on favoured tonnage. The local market in Alang, India continues to firm as elections continue but with growing confidence that Prime Mister Modi will continue his successful reign. And with that a renewed focus on growing the economy and infrastructure. Again this week, the Pakistan market seems to remain dormant”, the shipbroker concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide