- Seasonal slowdown weighs on recycling prices in Alang
- Regulatory changes boost market sentiment in Pakistan
South Asia’s ship-breaking markets show mixed trends, with Alang leading HKC-compliant recycling despite monsoon pressure on steel market, Pakistan attuning to regulatory shifts, and Bangladesh struggling with low prices, weak demand, and costly HKC compliance slowing down operations at yards.
Alang leads in HKC-compliant recycling
India has taken the lead in HKC-compliant ship recycling, with Alang yards actively absorbing vessels diverted from Bangladesh and Pakistan due to regulatory delays. Despite monsoon-season price pressure-risking levels below $400/LDT activity remains steady.
According to a market participant, “Steel prices have fallen significantly, leaving the market devoid of excitement. Although the Hong Kong Convention has officially come into force, it has not yet impacted market dynamics. Full implementation and enforcement will likely take time. For now, there is little movement, and selling at current levels would only result in losses, given the prevailing instability in the market.”
Another participant said, “The current market conditions as very poor, and recycling prices continue to decline”. He added that demand remains virtually absent, potentially due to the onset of the monsoon season, which is further weighing on sentiment and market activity.
Current offers:
Tanker- 430-440/LDT
Container- 440-450/LDT
Gadani sees limited arrivals despite positive outlook
The market has recently seen a shift in sentiment following budget announcements and fresh guidance from the PSBA. New regulatory requirements under the Hong Kong Convention, including IHM documentation and provisional DASR certifications, have positioned Pakistan as the strongest market in the subcontinent for fresh vessel sales—for the first time in months.
However, uncertainty remains around the timelines for obtaining ministry-level permissions, slowing actual arrivals. In fact, no new vessels have landed at Gadani in recent weeks, with only one idle vessel finally beached.
A source said, “The sentiment in Pakistan’s ship recycling market is turning positive, as the industry gains an edge following the government’s imposition of a 5% customs duty on re-rollable scrap. Ship-breakers are exploring opportunities to buy ships at levels around $400-415/per LDT.”
Deal:
A 6,000 LDT, Japan-origin vessel at $420-425/t
HKC compliance slows operations in Chattogram
Bangladesh’s ship recycling market has tumbled to the bottom, with buyers offering abysmally low levels as demand remains weak. Despite this, desperate sellers have committed ships to Chattogram, where nearly 86,000 LDT has been anchored, reflecting a market in flux even as HKC-compliant yards fill their plots with recent large acquisitions.
Local steel plate prices have dropped by about $8/t, the Bangladeshi Taka has weakened, and offers below $400/t are surfacing. Meanwhile, HKC implementation is slowing cutting operations and raising costs, leaving the market subdued with little activity and poor outlook heading into July.
Last week, Gadani Port received 10,386 LDT, stable compared to the previous week.
Alang Port received 41,961 LDT compared with 66,737 LDT in the previous week.
Chattogram Port received 85,723 LDT compared with 2,985 to previous week.
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