Global Ship Recycling Market Update: India Faces Setback as Demand for Recycled Steel Falls: BEST OASIS
October 5, 2025 — By Shipping News Desk
World’s leading cash buyer for ships sending for recycling, BEST OASIS in their weekly ship recycling market report, opined that the global ship recycling market witnessed mixed trends this week, as local market conditions diverged sharply across the key recycling destinations of India, Bangladesh, Pakistan, and Türkiye. Weaker sentiment in South Asia, particularly in India, has raised concerns among industry stakeholders who fear that ongoing regulatory and demand issues could hurt the momentum of the green recycling movement.
India: Local Market Weakens Amid Policy Stalemate
India’s ship recycling sector, centred around Alang, saw a sharp drop in local steel plate prices this week, with very limited buying interest from mills and stockists. The market, which had shown signs of stability in previous months, has now entered a cautious phase, as recyclers face growing difficulties in selling ship-recycled steel.
The core issue remains the lack of government approval for ship-recycled steel under the Bureau of Indian Standards (ISI). Without this formal recognition, re-rollers and construction industries are unable to use ship-recycled plates in certified infrastructure projects. As a result, much of the recovered steel is being diverted into scrap form, fetching lower prices and reducing recyclers’ profit margins.
The difference between steel plate and scrap prices has narrowed significantly, reflecting very low demand. This narrowing gap has led many recyclers to hold back purchases of new vessels, with yards operating at reduced capacity.
Industry observers warn that India’s current stance could undermine its position as a leader in green recycling. While Europe and other developed regions are actively promoting the use of refurbished and low-carbon steel, India’s delay in recognising ship-recycled steel is seen as counterproductive. “We are losing a valuable opportunity to promote circular economy practices,” a senior Alang yard operator said. “Without ISI approval, the material we recover cannot contribute to India’s sustainability goals.”
Bangladesh: Steel Prices Fall but Buying Interest Persists
In Bangladesh, the situation remains mixed. Local steel prices have continued to fall, reflecting weak demand from re-rolling mills. However, buyers have shown selective interest in mid-sized vessels above 10,000 light displacement tons (LDT), which remain economically viable under current market conditions.
The price gap between steel plates and heavy melting scrap (HMS) remains wide — unlike in India. This gives Bangladeshi recyclers a price advantage, allowing them to offer slightly higher bids for vessels. Consequently, Chattogram buyers are still able to attract tonnage that might otherwise have gone to Alang or Gadani.
Unless Bangladesh introduces new standards regulating ship-recycled steel, similar to India’s ISI framework, the country’s yards are expected to maintain this competitive advantage. For now, the market remains soft but is comparatively better positioned than its Indian counterpart.
Pakistan: Market Aligns with Regional Pressure
In Pakistan, sentiment continues to weaken. Local buyers are no longer willing to offer aggressive prices, instead aligning more closely with Indian levels. This adjustment follows regional market pressure, as softer steel prices and muted end-user demand have kept recyclers cautious.
Most Gadani-based buyers have stepped back from making fresh purchases, waiting for clearer price trends before committing. Offers for ships have dropped accordingly, with few deals concluded this week. “We are seeing regional parity return,” said a Karachi-based broker. “Prices are now in sync with India and Bangladesh, but the overall mood remains defensive.”
Türkiye: Stable Market with Slight Import Gains
Türkiye remains the most stable among major ship recycling destinations this week. Import scrap prices rose by around USD 3 per ton, but local steel prices held steady. The Turkish market continues to demonstrate resilience, supported by steady domestic construction demand and balanced inventory levels.
With limited vessel arrivals and stable margins, Turkish recyclers report a steady pace of activity. Analysts note that external factors, including fluctuations in the European steel market and energy costs, remain the primary influencers on Turkish operations. Overall, market stability is expected to persist in the short term.
Exchange Rate Movements
Currency movements showed marginal changes across the recycling nations.
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The Indian Rupee weakened slightly to INR 88.78 per USD, compared to 88.71 last week.
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The Bangladeshi Taka appreciated modestly to 121.70, up from 121.94.
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The Pakistani Rupee also gained slightly to 282.53, compared to 282.78.
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The Turkish Lira weakened marginally to 41.68 from 41.50 last week.
These modest fluctuations reflect general regional currency stability, though continued volatility in global oil prices and freight rates could introduce further uncertainty.
Scrap Price Overview
Prices for HMS 1&2 (80:20) and shredded scrap saw minor week-on-week changes.
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India: HMS at USD 350, shredded at USD 360, down 0.7%.
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Bangladesh: HMS at USD 350, shredded at USD 358, down 0.4%.
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Pakistan: HMS at USD 350, shredded at USD 360, down 0.7%.
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Türkiye: HMS at USD 345, shredded at USD 365, up 2.1%.
Ship Recycling Prices
Recycling rates softened slightly in South Asia but remained firm in Türkiye.
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India: USD 417 (Container), USD 403 (Tanker), USD 388 (Bulker), down 2.4%.
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Bangladesh: USD 421 (Container), USD 411 (Tanker), USD 387 (Bulker), down 2.4%.
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Pakistan: USD 415 (Container), USD 400 (Tanker), USD 395 (Bulker), steady.
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Türkiye: USD 270 (Container), USD 260 (Tanker), USD 250 (Bulker), unchanged.
Recent Vessel Sales
A few notable transactions took place this week despite subdued sentiment:
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FU RONG YUAN (LPG, 2,351 LDT) delivered in China for internal recycling at USD 390/LDT.
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IMPALA (Bulker, 4,427.9 LDT) delivered at Alang, India for USD 465/LDT.
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INTERIM (Oil Tanker, 7,841 LDT) delivered in the Asian Subcontinent for USD 470/LDT.
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LADY L (Reefer, 5,827 LDT) delivered at Alang for USD 458/LDT.
Outlook
As the last quarter of 2025 begins, global ship recyclers are facing a period of adjustment. India’s policy gridlock over ISI certification remains a key concern, threatening to slow the country’s progress toward sustainable ship recycling. Meanwhile, Bangladesh and Pakistan are balancing between weak domestic demand and opportunities created by India’s slowdown.
With steel markets soft and ship supply steady, the coming weeks will likely test the resilience of South Asia’s recycling hubs — and determine whether India can reclaim its competitive edge in the global green recycling race.
Author: shipping inbox
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