South Asia: Ship recycling markets subdued due to geopolitical uncertainty, Eid slowdown

• Middle East tensions disrupt supply chains, raise costs
• Pakistan market steady amid cautious post-Eid optimism

Ship recycling markets across South Asia remained subdued, impacted by Eid holidays, currency fluctuations, and ongoing geopolitical tensions. While activity slowed across key hubs, underlying sentiment varied, with India facing cost pressures, Pakistan showing cautious optimism, and Bangladesh struggling to convert strong pricing into actual transactions.

Global pressures and domestic weakness weigh

Alang’s ship recycling market remained subdued during Eid, with sentiment weighed down by both global and domestic pressures. Middle East tensions disrupted crude supply flows, while tighter scrutiny on Russian oil raised energy costs, impacting operations.

Domestically, a weaker rupee dampened buyer confidence, with steel plate prices fluctuating between $418-422/t. Despite strong HKC compliance supporting competitiveness, vessel arrivals remained limited as market participants awaited clearer supply amid ongoing global uncertainties.

Stable market with emerging opportunity signals

Pakistan’s ship recycling sector paused for Eid holidays 21-23 March, with reduced activity expected. More importantly, sentiment heading into the break reflected cautious optimism-an improvement from the prolonged weakness seen in Gadani over the past 18 months.

Market participants reported a mixed outlook, with firm demand for bulk carriers but limited deal visibility, including unconfirmed reports of Bangladesh securing cargo near $450/t and India booking OFAC-compliant material.

Steel plate prices held stable at $592-595/t, while a stable rupee supported cost predictability. Middle East tensions may divert tonnage toward Gadani. Progress in HKC compliance is strengthening the market, though ongoing protests continue to pose mild risks.

Eid lull, currency pressure

Bangladesh’s ship recycling market remained quiet during Eid, with no fresh arrivals at Chattogram despite leading regional prices. The Bangladeshi Taka weakened further against USD, increasing cost pressure for recyclers purchasing dollar-denominated tonnage.

Steel plate prices edged up to around $511-515/t, mainly due to supply concerns rather than strong demand. Two sanctioned VLCCs remained idle without clearance, highlighting regulatory risks.

Post-Eid recovery will depend on improved LC approvals and vessel inflows, while ongoing HKC compliance progress may support  sentiment.