South Asia: Ship recycling market witnesses mixed activity across countries

• Alang faces pressure from weak INR, soft steel prices
• Gadani sees renewed sales buoyed by low tariffs

South Asia’s ship-breaking markets showed mixed activity this week, with Bangladesh and India remaining subdued due to weak fundamentals, while Pakistan’s Gadani market gained momentum supported by steady steel prices and lower tariffs.

Fresh tonnage arrivals offer rare boost to Alang

Alang remains under pressure from economic headwinds, with the Rupee weakening and steel prices falling by $15/t to $409/t. While some cash buyers see increased tonnage inflows as a recovery sign, market sentiment remains weak, making conditions challenging for vessel owners.

Negotiations slowed this week, with some vessels potentially diverted to Pakistan. Only a few sales occurred, including the 1997-built NIIGATA TRADER (4,810 LDT) at $480/LDT-well above market fundamentals. Despite the gloom, fresh tonnage, including another Capesize, arrived at Alang, offering a rare boost amid high tariffs and sanctions.

Gadani shows signs of renewed activity

Gadani saw renewed activity this week after a month of quiet, with bulkers like RISING HARRIER (8,600 LDT) at $445/LDT and PUTERI KIRANA (8,082 LDT) at $390/LDT sold to local recyclers, including one arriving from Indonesia. Even a small sub-3,000 LDT handy vessel was recycled, highlighting rising DASR certification costs and pressure on local yards.

Steel plate prices remain steady, and the PKR strengthened on low 20% tariffs. However, delayed HKC compliance and infrastructure upgrades continue creating a tonnage backlog, with few recyclers negotiating most offerings.

Bangladesh market remains quiet 

Ship recycling remains quiet, with stagnant steel prices and a weaker Taka limiting activity. Smaller LDT units dominate, while buyers focus on scarce larger Capesize and Panamax vessels, often diverted elsewhere. HKC-compliant yards total 18, with three more expected, yet activity stays slow due to limited support and delayed upgrades.

Tonnage received last week

Gadani Port received 2,894 LDT, compared to empty vessels in the previous week.

Alang Port received 89,540 LDT, compared with 83,952 LDT in the previous week.

Chattogram Port received 14,861 LDT compared with 44,802 LDT in the previous week.