Ship Recycling: Severe weather affected India
In the recent overview of ship recycling markets, India witnessed a downturn affected by severe weather, which hampered steel demand; recovery is anticipated after the forthcoming election results. Bangladesh’s market remains stable but is braced for potential shifts due to possible hikes in import duties. In Pakistan, the market is subdued, with looming uncertainties about new import taxes in the upcoming national budget, profoundly impacting the steel sector. Turkiye maintains stable market conditions, despite a persistently low supply of ships.
Oil prices have climbed to their highest levels in weeks, driven by escalating geopolitical tensions in the Middle East and expectations that OPEC+ will continue their voluntary reduction of oil production, cutting about 2.2 million barrels per day—a strategy initiated in 2023 to stabilize global prices. With the United States, the world’s top oil consumer, entering its peak demand season and maintaining production cuts, forecasts suggest that this summer’s demand could reach record highs, further supporting the upward trend in oil prices.
The Organization of Petroleum Exporting Countries (OPEC) is optimistic about robust oil demand growth in 2024 and 2025 due to a resilient global economy. It is projected that oil demand will grow by 2.2 million barrels per day (bpd) in 2024, reaching an average of 104.5 million bpd. At an upcoming OPEC+ group meeting, strategies for managing production cuts in the second half of the year will be reviewed. In 2025, the forecast shows further expansion, with demand increasing by 1.8 million bpd year-over-year to an average of 106.3 million bpd.
INDIA
The market anticipates a rebound post-elections amid a weather-related Slowdown.
The market recently experienced a slight downturn. It is anticipated to recover and strengthen following the announcement of the election results.
The current decline has been influenced by exceptionally hot weather, which has negatively impacted construction and infrastructure projects. This slowdown has led to a reduced demand for steel and, subsequently, vessels.
India’s gross domestic product (GDP) grew by 7.8% on an annual basis in the January-March period, exceeding expectations of a 6.7% rise. This robust growth follows an 8.4%
Container Tanker Bulker
increase in the previous quarter. Consequently, for the full fiscal year, India’s GDP expanded by 8.2%, an improvement from the 7% growth observed in the previous fiscal period.
Beaching Dates
03 June to 11 June 2024
19 June to 28 June 2024
02 July to 11 July 2024
BANGLADESH
Market conditions remain steady as expectations of a potential market correction loom.
The market conditions have persisted without significant change compared to last week.
There is an even probability of a rise in import duties, which could lead to reduced booking prices leading to more sales and a possible adjustment in the market. Sales continue to be affected by a combination of factors, including elevated booking prices, market expectations of forthcoming adjustments, and a decline in demand from steel mills.
Fitch Ratings lowered Bangladesh’s Long-Term Foreign-Currency Issuer Default Rating from ‘BB-‘ to ‘B+’ on Monday. The downgrade reflects the significant reduction in the country’s foreign exchange reserves, which have decreased by 15% since January 2024 to $18.4 billion. This decline is attributed to ongoing foreign exchange interventions, capital outflows, and the frequent use of unofficial remittance channels.
Beaching Dates
05 June to 08 June 2024
22 June to 25 June 2024
05 July to 08 July 2024
PAKISTAN
Market plummets due to anticipation of new budget taxes; several steel factories shut down.
The market is currently subdued, with investor sentiment dampened by anticipation of the national budget, which is expected to potentially introduce additional taxes on imported goods.
The challenging market environment has prompted the shutdown of several large steel manufacturing units, underscoring the significant impact on the industrial sector.
Pakistan will present its annual budget for the fiscal year 2024/25 on June 10. The announcement was initially scheduled for June 7 but was delayed. The presentation of the budget is particularly significant as the country prepares to negotiate a new loan with the International Monetary Fund (IMF).
Beaching Dates
Throughout the month
TURKIYE
Market stagnation persists with unchanged conditions and low tonnage supply.
This week, market conditions have remained stable with no notable changes observed.
Concurrently, the supply of tonnage continues to be low. In the first quarter of 2024, Turkey’s GDP experienced a significant increase of 5.7% compared to the same period the previous year. This growth, documented in recent official data, marks a notable acceleration from the figures reported at the end of 2023. This economic expansion has occurred despite the implementation of tight monetary policies designed to curb high inflation rates.
Beaching Dates Throughout the month
