Ship Recycling Picks Up Pace
In a separate note, shipbroker Allied Shipbroking said that “a very interesting week took place for the ship recycling market, given the plethora of high LDT units being concluded for demo. Going beyond the tanker sector, that has extensively nourished the overall demolition market for several months now, we managed to see a couple of Capesize units being concluded for scrap recently at relatively firm levels around of around mid/high US$ 600/ldt. This, of course, can be seen as coming rather inline with the recent negative pressure that has been noted in terms of freight earnings, although it can bee hardly said to be in a market that has been feeling any sort of “pain” in this regard.
In the Indian Sub-Continent, the competition amongst the different destinations seems to be on the rise, with Pakistani and Bangladeshi breakers ready to heavily compete on any available units that come to market, leading their offered prices to fairly firm levels. India seems to be also back in the game, so to speak, having recently secured a couple of units or so this past week. In terms of other main demo destinations, the Turkish market has been able to uphold a fair stability as of late, attracting a couple of high ldt pax units this past week”.
In its latest weekly report, GMS , the world’s leading cash buyer of ships, noted that “another promising week passed in the sub-continent markets this week, with resurgent Pakistani and Bangladeshi (in particular) markets putting down some show stopping numbers on available units. We have seen several Capes sold for HKC recycling in the mid USD 600s/LDT in recent weeks, especially as chartering rates in this sector have taken a bit of a dip. Tankers keep being introduced into the recycling markets and several deals have reportedly been concluded at levels in excess of USD 650/LT LDT in Bangladesh, as the Chattogram market heats up to some increasingly unprecedented levels.
Steel prices remain firm across all sub-continent locations and even the Indian market has started to come back into the picture, such is the demand emanating from all markets at present. Finally, the Turkish market remains impeccably poised to place some record levels of their own, if only the dearth of tonnage wouldn’t have kept the market so exquisitely stranded. Overall, given some of the numbers on show, it is indeed surprising that not more candidates are being introduced for a recycling sale. Yet, there are likely enough inklings in the wet sector to suggest a turn in sentiments, which may lead even more Owners to hold on to their tonnage for now. With Chinese production set to ramp up again now that Chinese New Year holidays and the winter Olympics are over, perhaps there is scope for further improvements on price as well”, GMS concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide