GLOBAL SHIP RECYCLING MARKET REMAINS UNDER PRESSURE AS SUBDUED SENTIMENT PERSISTS: BEST OASIS
In its weekly ship recycling report, Best Oasis, one of the world’s leading cash buyers of ships for recycling, observed that the global ship recycling market continues to tread water, weighed down by weak fundamentals, sluggish activity, and persistent uncertainty across major recycling destinations in South Asia. Despite minor fluctuations in exchange rates and local scrap values, there is little sign of any substantial recovery in sentiment or pricing.
India: Subdued Sentiment, Stagnant Prices
In India, the market remains trapped in a subdued phase, showing no meaningful improvement in activity or pricing. Buyers and recyclers are cautious, constrained by low demand and persistent cost pressures.
While the Indian rupee gained marginal strength against the U.S. dollar this week—moving from 87.95 to 87.73—this appreciation has not translated into firmer vessel prices. The average rates for ship recycling have continued to stagnate at around USD 412 per LDT for containers, USD 398 for tankers, and USD 383 for bulk carriers, showing no week-on-week movement.
A few recyclers who managed to secure tonnage earlier at lower acquisition levels are now offering steel products at reduced selling prices. This has created additional strain on competitors operating at regular cost structures, further squeezing margins.
Local scrap values have mirrored this weakness. Prices for HMS 1&2 (80:20) stand at USD 350 per tonne, and shredded scrap at USD 360 per tonne, marking a week-on-week decline of 1.39%.
With yard inventories gradually rising and demand from end-users lagging, recyclers are treading carefully, avoiding speculative purchases. The outlook remains flat, with expectations that any meaningful recovery will depend on improved steel demand and stability in foreign exchange rates.
Bangladesh: Weak Market, Selective Buying
The Bangladeshi market continues to soften, with further declines in scrap prices expected to be reflected in the coming week. Despite the weak fundamentals, buyer interest persists, largely driven by the scarcity of tonnage in the global recycling market.
Prices of HMS 1&2 and shredded scrap stand at USD 355 and USD 365 per tonne, respectively, down by 0.82% week-on-week. The exchange rate has weakened slightly, with the taka falling from BDT 121.51 to BDT 122.23 per USD, a marginal loss of 0.72.
Local recyclers are showing selective buying interest, particularly in tankers and bulkers, which continue to attract stronger demand compared to other vessel types. However, overall activity levels remain muted.
Market sentiment in Chattogram is cautious, as yard owners wait for clearer price signals amid falling global steel prices. For now, end buyers remain hesitant, unwilling to commit at prevailing rates given the lack of downstream recovery in the construction and infrastructure sectors.
Despite the gloomy backdrop, Bangladesh maintains the highest average offered prices in the subcontinent—USD 445 per LDT for containers, USD 435 for tankers, and USD 400 for bulkers—though these too have remained unchanged this week.
Pakistan: Limited Demand, Watchful Market
In Pakistan, the ship recycling market remains largely stagnant, with vessel prices under mild downward pressure. The few active buyers in Gadani—estimated at just two or three—are exercising extreme caution amid a tightening financial environment and fluctuating exchange rates.
This week, the Pakistani rupee weakened slightly from PKR 282.48 to PKR 282.63 per USD, reflecting minimal movement. Despite this, buyers are wary of taking on new commitments as steel prices continue to show signs of weakness.
Average offered prices remain stable at USD 415 per LDT for containers, USD 400 for tankers, and USD 390 for bulkers. However, local traders expect some correction in the coming weeks as new tonnage enters the market at lower levels.
The week saw two bulk carriers—AL SAMA (9,484 LDT) and ASMAA (7,070 LDT)—sold and delivered at Gadani at rates of USD 435 and USD 430 per LDT, respectively, highlighting Pakistan’s competitive positioning in this segment.
While the market tone is slightly negative, recyclers are monitoring foreign exchange trends closely, as a stable rupee could potentially revive interest. However, for now, limited liquidity and sluggish steel demand continue to weigh on sentiment.
Turkiye: Gradual Recovery in Sight
The Turkish market showed a slight but notable improvement this week, providing a rare bright spot in an otherwise subdued global recycling environment.
Local scrap prices increased by around USD 3 per tonne, while import prices held steady. Vessel prices also recorded a modest gain, helping lift overall sentiment in Aliaga.
Rates now stand at USD 280 per LDT for containers, USD 270 for tankers, and USD 260 for bulkers, marking a 3.85% week-on-week rise—the only upward movement among major recycling destinations.
This strengthening comes after a prolonged period of quiet activity, as Turkish buyers cautiously return to the market amid more stable economic indicators and modest improvement in local demand.
Among this week’s recorded transactions, the CROATIA, a multipurpose vessel of 1,197 LDT, was delivered to Aliaga at USD 230 per LDT, illustrating the continued recovery of small-tonnage purchases in the region.
Despite the encouraging movement, industry players remain cautious, pointing to limited volumes and external factors such as regional steel price volatility and shipping cost fluctuations as key risks.
Exchange Rates and Oil Prices
The week’s currency trends offered mixed signals across recycling markets.
| Currency Pair | This Week | Previous Week | Change |
|---|---|---|---|
| USD / INR | 87.73 | 87.95 | +0.22 |
| USD / BDT | 122.23 | 121.51 | +0.72 |
| USD / PKR | 282.63 | 282.48 | -0.15 |
| USD / TRY | 42.02 | 41.88 | -0.14 |
Oil benchmarks—Brent and WTI crude—remained volatile during the week but offered limited impact on ship recycling activity, as bunker costs are no longer a major factor with minimal demolition deliveries. However, their broader influence on shipping demand and scrap availability remains relevant for market outlooks heading into the final quarter of 2025.
Summary of Scrap and Vessel Prices
| Location | HMS 1&2 (USD/ton) | Shredded (USD/ton) | W-o-W Change (%) |
|---|---|---|---|
| India | 350 | 360 | -1.39% |
| Bangladesh | 355 | 365 | -0.82% |
| Pakistan | 354 | 364 | -0.82% |
| Turkey | 348 | 368 | -1.08% |
| Location | Market Status | Container (USD/LDT) | Tanker (USD/LDT) | Bulker (USD/LDT) | W-o-W Change (%) |
|---|---|---|---|---|---|
| India | Soft | 412 | 398 | 383 | 0 |
| Bangladesh | Soft | 445 | 435 | 400 | 0 |
| Pakistan | Firm | 415 | 400 | 390 | 0 |
| Turkey | Firm | 280 | 270 | 260 | +3.85 |
Vessels Sold This Week
| Vessel Name | Type | LDT | Delivery | Sale Type | Price (USD/LDT) |
|---|---|---|---|---|---|
| ATHENA | FPSO | 5,642 | Spain | Delivered | Undisclosed |
| PUTERI NILAM | LNG Tanker | 26,915 | Melaka, Malaysia | As-is | Undisclosed |
| PUTERI DELIMA | LNG Tanker | 26,915 | Labuan, Malaysia | As-is | Undisclosed |
| AL SAMA | Bulker | 9,484 | Gadani, Pakistan | Delivered | 435 |
| ASMAA | Bulker | 7,070 | Gadani, Pakistan | Delivered | 430 |
| CROATIA | MPP | 1,197 | Aliaga, Turkiye | Delivered | 230 |
| DALIA | Bulker | 1,368 | Alang, India | Delivered | Undisclosed |
| ARATERE | RoRo/Cargo | 8,100 | Wellington, NZ | As-is | Undisclosed |
| ICON AMARA | PSV | 2,606 | Labuan, Malaysia | As-is | Undisclosed |
| PREMIUM BAHARI | General Cargo | 2,627 | Jakarta, Indonesia | As-is | 275 |
Outlook
Looking ahead, the global ship recycling market faces continued headwinds. South Asian yards are struggling to maintain margins amid declining scrap values and tepid steel demand. While Turkey shows early signs of a rebound, broader market fundamentals remain weak.
With limited tonnage entering the demolition stream and shipowners preferring to hold onto older assets amid fluctuating freight rates, recyclers across Alang, Chattogram, and Gadani are likely to endure another challenging quarter before any meaningful recovery sets in.
Author: shipping inbox
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