Letter of Credit (LC) opening issues continue to be a major concern for ship owners, with Bangladesh effectively restricting new scrap ship arrivals as the country’s Central Bank has refused to sanction any new financing for ship recycling endeavours.
Imported ship-breaking prices fell by $10-45/LDT in India, Bangladesh and Pakistan. Current offers are at nearly 15-month lows as the previous lowest price levels in these countries were last recorded in July 2021, as per data maintained with SteelMint.
LC issues in Bangladesh
Due to current LC restrictions, buyers are unable to bid for vessels. Additionally, those who do have access to private financing for vessel purchases prefer to wait and see in case the market declines further.
According to reports, getting permission for even the smallest LC of $1 million (and lower) is difficult these days.
Deals
Total tonnage reported last week at Chattogram Port was 47,919 LDT.
Shaky fundamentals in India
The Indian Rupee has been the main cause of concern lately after falling, worryingly, to over INR 82 against the greenback before firming up to INR 80.4 last week.
There have been very few sales to record and getting any sort of even a decently firm offer has become a challenge, especially given the lack of stability in market fundamentals.
Deals
Total tonnage at Alang Port last week was 45,603 LDT.
Pakistani buyers short on confidence
Pakistan’s market currently lacks confidence, as evinced by the absence of firm offers last week. As the Pakistani Rupee hovers around PKR 260 against the USD, fundamentals are still low and unstable.
Total tonnage at Gadani Port last week was nil.
Prices in $/LDT
Source: SteelMint Research
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