Global Ship Recycling Drifts into September on Silent Seas as Steel Weakness Weighs
STAR ASIA cash buyers of ships sending for recycling in their weekly ship recycling market report opined that the global ship recycling sector entered the first week of September 2025 with an unusually quiet tone, as muted activity across the major recycling destinations reflected weak steel fundamentals and hesitant buyer sentiment. From Alang in India to Chattogram in Bangladesh, Gadani in Pakistan, and Aliaga in Turkey, the trend was the same: a cautious wait-and-watch approach dominating the yards, influenced by sluggish domestic demand for steel, price adjustments, and economic uncertainties in the broader construction and manufacturing industries.
At Alang, India’s sprawling ship recycling hub, the week passed without the conclusion of any new vessel sales. Market participants attributed this lull primarily to a softening in domestic steel demand, which has been evident through marginal reductions in the price of local plate and scrap. Though the cuts were not dramatic, they were enough to create an air of caution among buyers who are closely monitoring demand patterns before committing to fresh tonnage. Yard operators suggested that the lack of urgency among recyclers stemmed from the absence of strong end-user demand, with downstream industries adopting conservative procurement strategies amid fears of a broader slowdown.
On the anchorage front, the beaching positions in Alang reflected a subdued scene. The tanker MAHAR, with a light displacement tonnage of 18,264, arrived earlier in the month and remains awaiting beaching. The larger tanker CONICO ATLAS, carrying 20,001 LDT, has been under arrest since its arrival in June and shows little sign of progress. Another tanker, NIRVANA, with 9,623 LDT, has also remained in arrested status since May, underlining the protracted delays some vessels are facing due to legal and regulatory complications. Among the smaller vessels, the general cargo ship ABDULLAH F, with 2,766 LDT, successfully completed its beaching on September 2 after arriving in mid-August. However, this isolated activity does little to change the prevailing perception that Alang is in a wait-and-watch phase, with stakeholders hesitant to accelerate purchases until steel market indicators become clearer.
Across the Bay of Bengal in Chattogram, Bangladesh’s ship recycling market mirrored the caution evident in India but faced its own unique set of challenges. A prolonged slowdown in the domestic steel industry continues to weigh heavily on sentiment. The most telling indicator of this downturn was a sharp drop of US$11 per metric ton in local scrap prices this week, a fall that recyclers acknowledged as reflective of weakening demand for finished steel. Despite recyclers maintaining their purchase price levels for vessels, the reality of end-user demand has created a discouraging environment, particularly for smaller tonnage. Price indications from local buyers are now noticeably lower, as the market struggles to balance vessel supply with deteriorating downstream conditions.
Yet, amid these headwinds, Bangladesh marked an important milestone in its effort to modernize and reposition its ship recycling industry on the global stage. The Bangladesh Ship Recycling Board (BSRB) officially launched its suite of digital platforms, signaling a commitment to greater transparency, accountability, and global integration. The initiative, spearheaded by Md. Obaidur Rahman, Secretary of the Ministry of Industries and Chairman of BSRB, includes the unveiling of a comprehensive website and official channels on X, LinkedIn, Facebook, and YouTube. These platforms are designed to serve as the central repository for industry news, compliance updates, and international engagement. Industry stakeholders widely welcomed the move, noting that it provides a credible avenue to showcase progress, build investor confidence, and align more closely with international conventions.
This digital transformation aligns with Bangladesh’s ratification of the Hong Kong Convention in 2023, a framework that aims to enhance worker safety, environmental protection, and governance standards in global ship recycling. By embedding these practices into its digital ecosystem, Bangladesh hopes to address long-standing concerns about workplace safety and ecological sustainability while positioning itself as a responsible and reliable hub in the global recycling chain. Market watchers see this as a significant step that could eventually help attract more international shipping companies to choose Bangladesh as their recycling destination, particularly those under pressure to comply with global environmental and labor standards. Despite the market’s immediate struggles with steel demand, this strategic shift underscores Bangladesh’s long-term vision for the industry.
On the operational side, vessel movements in Chattogram were minimal, with only the bulker DK 03, carrying 7,809 LDT, remaining at anchorage since its arrival in early August, still awaiting beaching. The absence of new arrivals this week further underscored the quietness of the market.
Meanwhile, Pakistan’s Gadani market displayed a slightly different dynamic. Prices for ship recycling have held firm despite the weakening local steel sector. The downturn in steel demand here is linked not to industrial cycles but to natural disasters. Severe flooding across Punjab, one of the country’s most critical regions for construction and infrastructure activity, has dampened steel consumption as supply chains and project timelines face significant disruptions. Despite this, recyclers in Gadani continue to show interest in acquiring tonnage, though with a noticeably cautious approach to pricing. While there is underlying demand from local buyers, the prevailing market conditions have made them hesitant to commit at higher levels. This cautious optimism reflects an industry trying to balance the need to maintain yard activity with the reality of subdued demand.
The vessel roster at Gadani showed the general cargo ship FORTUNE OCEAN, with 2,261 LDT, still at anchorage since mid-August, awaiting its turn to be beached. This delay, while not uncommon, again highlighted the broader pattern of slow vessel turnover across South Asia during this period.
Turkey’s ship recycling market, centered in Aliaga, showed no new signs of life during the week. Activity levels remained unchanged from the previous reporting period, and recyclers there had little to report in terms of new arrivals or transactions. What did capture attention, however, was the continued fluctuation in exchange rates, with the Turkish lira slipping another 0.3 percent against the US dollar. For Turkish recyclers, currency depreciation remains a persistent challenge, adding layers of complexity to vessel acquisition decisions in a market already facing lukewarm steel demand.
In summary, the first week of September underscored the fragile balance in global ship recycling markets. While the sector has seen cycles of activity and lull before, the combination of weak domestic steel demand across South Asia, localized disruptions such as flooding in Pakistan, and external economic pressures in Turkey has created a synchronized slowdown. Yet, within this cautious environment, Bangladesh’s digital leap forward stood out as a beacon of forward-looking reform, suggesting that even in difficult times, the industry is evolving to meet the demands of modern governance and global scrutiny.
The coming weeks will be crucial in determining whether these markets can shake off the inertia and find renewed momentum. Much will depend on the trajectory of steel demand, government interventions in infrastructure and construction, and the willingness of recyclers to adjust pricing strategies to stimulate activity. For now, however, the global ship recycling sector remains anchored in uncertainty, navigating a delicate course through volatile currents.
Author: shipping inbox
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