South Asia: Ship-breaking market in Alang still holds lead as Gadani, Chattogram race for HKC compliance

• Alang leads in deliveries despite weak bids
• Pakistan’s steel plate prices firm, compliance lags

South Asia’s ship-breaking markets continued to face headwinds as HKC compliance reshaped regional market dynamics. While Bangladesh seems to be in a race to certify yards, Pakistan lags behind in upgrades. India, on the other hand, continues to see weak sentiment despite leading in vessel arrivals amid volatile steel and currency trends.

Alang sentiment subdued

India’s ship recycling market trailed behind Bangladesh and Pakistan, missing key pre-HKC tonnage.

India faced instability due to falling steel plate prices ($428/t) and a weakening rupee making it the region’s weakest currency. However, Alang still led in deliveries last week, receiving five vessels totaling nearly 67,000 LDT.

With the Hong Kong Convention now active, India’s edge as the only HKC-compliant hub is fading. As Bangladesh and Pakistan catch up, India’s dominance may face growing pressure.

According to a market participant, “Despite some visible activity in Alang, sentiment in India’s ship-breaking market remains bleak. Bhavnagar-based recyclers report that overall momentum is weak, with the market continuing to decline. While a few vessels are being offered, most are priced too high, making it difficult for buyers to close deals.”

Current offers:

Tanker

Offered: $440-450/LDT
Workable: $425/LDT

Container

Offered: $450-460/LDT
Workable: $435/LDT

Gadani scrambles for HKC compliance 

Pakistan’s ship recycling hub in Gadani is rushing to align with the Hong Kong Convention (HKC), which comes into effect this week. While some yards have begun upgrades, progress is slow, and full compliance may take well into 2026-putting Gadani behind regional competitors.

Though a few non-HKC vessels have been secured recently, the shift toward compliant tonnage is tightening market access. Domestic steel plate prices remain stable at $611/t, offering recyclers some cushion.

Authorities may issue limited approvals based on yard readiness, but whether this selective approach can divert vessels from India remains uncertain.

A participant commented, “Activity in Gadani last week was primarily driven by regulatory deadlines because of the HKC last date.”

Certification gap narrows options for Chattogram yards

With the Hong Kong Convention set to take effect on 26 June, only 10 Chattogram yards have secured certification, while 25 remain under upgrade. Without HKC approval, these yards cannot obtain NOCs or join fresh bids, forcing large vessels to divert to India.

Market sentiment remains weak amid stagnant steel plate prices at $551/t, ongoing monsoon disruptions, and sluggish downstream demand. The Bangladeshi Taka recovered slightly, but construction and manufacturing remain slow. A $5/t price drop from budget tax revisions adds pressure, though Bangladesh still leads in global scrap prices.

Recycling operations and downstream steel activity continue to face disruptions, while finished steel demand is expected to remain low due to slow construction and manufacturing activity.

Last week, Gadani Port received 10,386 LDT compared with 20,562 LDT in the previous week.

Alang Port received 66,737 LDT compared with 53,521 LDT in the previous week.

Chattogram Port received 2,985 LDT stable compare to previous week.