The South Asian ship recycling market remained dull this week across markets. In India, the Alang market witnessed a subdued week, marked by a notable absence of buyers attributed to ample tonnage availability, upcoming elections, and recent holidays. Conversely, Pakistan’s market remained quiet amid Ramadan, with fluctuating bids contributing to market uncertainty. Meanwhile, Bangladesh encountered scarcity in high-quality tonnages amidst geopolitical tensions, albeit witnessing a small container sale.
INDIA
The absence or disinterest of Alang buyers in India can be attributed to several factors. Firstly, there is a substantial availability of tonnage in the market, which has reduced the urgency for buyers to make purchases. Additionally, the upcoming elections, recent Holi holidays, and uncertain domestic economic conditions have contributed to a lacklustre week in the market.
Meanwhile, local steel plate prices experienced slight increases but remained volatile on a weekly basis, while the weakening of the currency against the US dollar added to market uncertainties. With Ramadan ongoing and more holidays approaching, local buyers are expected to remain focused on festivities, unless a significant event such as a victory for the Modi government occurs, which could potentially stimulate positive price trends before the monsoon season.
Furthermore, Alang buyers are facing stiff competition from counterparts in Chattogram and Gadani, leading to a reduction in the Indian market’s share of recycling tonnage since the beginning of the year.
The total tonnage received in Alang this week amounted to around 46,146 LDT.
PAKISTAN
This week, the Pakistani market stayed quiet due to Ramadan, leading to a lack of firm bids. Interestingly, two buyers submitted bids for the same vessel and received different offers, causing confusion in the market and dampening interest.
Given the higher prices prevailing in the market, it appeared that buyers at the lower end of the pricing scale were not actively seeking tonnage, perhaps only considering selective units. Additionally, as local recyclers received several units in recent weeks amid Ramadan, Pakistani buyers seemed less motivated to make significant purchases.
Steel plate prices remained unchanged w-o-w at around PKR 205,000-210,000/t. Meanwhile, Pakistani rupee touched 277.89 compared to 1 US dollar.
The total tonnage received in Gadani port was around 32,285 LDT this week.
BANGLADESH
In Bangladesh, buyers are encountering a scarcity of high-quality tonnage, worsened by a slowdown during Ramadan. Additionally, geopolitical tensions arising initially from Ukraine and later from the Red Sea have disrupted shipping lines, impacting global economies and fuelling inflation. These tensions have also hampered ship recyclers, notably at a time when letters of credit (LC) restrictions were starting to ease through International Monetary Fund (IMF) loans to Pakistan and Bangladesh.
However, amidst these challenges, at least one small container sale managed to occur this week. The sale of the HE SHENG (4,833 LDT) was confirmed at $552/LDT, as Chinese owners divested from their share of the world’s aging fleets.
In addition to the above, steel flat prices remained flat at BDT 74,000-75,000/t and the Bangladeshi taka stands at 109.6 against the US dollar.
The total tonnage received at Chattogram Port was around 18,761 LTD this week.
