South Asia: Ship recycling sentiment improves post-Eid, supply constraints persist

• Vessel supply remains limited across region
• Compliance and caution shape buying decisions

South Asia’s ship recycling markets showed improved sentiment this week, supported by post-Eid demand and stable domestic fundamentals. Bangladesh led with strong buying interest, while Pakistan gained from firm steel prices and a stable currency.

India saw slight support from a stronger rupee, though operational challenges persisted. Limited vessel availability continued to restrict overall activity across the region.

INR recovery supports sentiment, but supply constraints persist

India’s ship recycling market showed slightly improved sentiment, supported by a stronger rupee against the US Dollar and a modest rise in plate prices to about INR 38,500/t ($415/t), improving recyclers’ margins.

A market participant said, “Firm price trends are being seen in the ship recycling market. However, gas supply issues continue to affect operations. Ship cutting is still ongoing with PNG supply, though at a slightly slower pace.”

LPG disruptions reduced steel demand, while low vessel supply kept yard activity weak. India still holds an edge with over 115 HKC yards, though low inflows limit utilisation.

Firm steel prices support Gadani recyclers

Pakistan’s ship recycling market entered the week on a stronger footing, supported by firm steel plate prices holding around PKR 175,000/t (about $627/t) and a stable rupee. This improved pricing has strengthened recyclers’ confidence and positioned Gadani competitively within the sub-continent.

Structural progress continues with three HKC-compliant yards operational, improving Pakistan’s position as an alternative to India, supported by proximity to Gulf tonnage. However, activity still depends on vessel supply, and sustained improvement will rely on higher inflows in the coming weeks.

Strong post-Eid demand continues in Bangladesh 

Bangladesh’s ship recycling market stayed strong, with active buying interest as yard space clears and LC approvals improved after Eid. Chattogram remained competitively priced, ahead of India in the sub-continent.

Steel prices saw a slight increase, while the currency stayed stable, offering some support. However, concerns over sanctioned vessels kept buyers cautious.

With the monsoon period approaching, market activity will depend on vessel supply and smoother financing in the coming weeks.