Global Ship Recycling Markets Navigate Volatile Currency Trends: Liquidity Pressures and Shifting Buyer Sentiment: BEST OASIS
The global ship recycling industry continued to face a complex mix of currency volatility, tightening liquidity and uneven buyer sentiment across major markets this week, according to leading cash buyer BEST OASIS in its latest weekly report. While some regions showed signs of stability and long-term improvement, others struggled with operational slowdowns, widening price gaps and muted demand—underscoring the fragile balance shaping today’s recycling landscape.
India: Buyers Stay Cautious as Dollar Fluctuations Cloud Market Direction
India, traditionally the most active ship-recycling destination, remained cautious this week as unpredictable dollar movements weighed heavily on domestic sentiment. The Indian rupee, which strengthened slightly from 89.69 to 89.46 per USD, did little to boost confidence as recyclers continued to find negotiations difficult under ongoing currency instability.
Purchasing enthusiasm for new tonnage—especially larger vessels—remained limited. According to the report, only two new sales were believed to have concluded, but most of the ships currently circulating for recycling were classified as sanctioned or part of the so-called “dark fleet,” reducing viable options for mainstream buyers.
With buyers reluctant to overcommit amid uncertain forex trends, the Indian market largely adopted a wait-and-watch approach. Recyclers are seeking greater clarity on the currency outlook before taking on substantial fresh volumes.
Scrap price indicators also reflect the mild slowdown. HMS 1&2 (80:20) prices stood at $350 per tonne, while shredded material averaged $355, marking a slight dip of 0.70% week-on-week. In terms of vessel prices, India remained firm but reported a decrease across categories: containers at $410/LDT, tankers at $397/LDT and bulkers at $381/LDT, down by 1.25%.
Bangladesh: Weak Market Conditions, Liquidity Crunch Hit Recycling Yards
Bangladesh experienced the sharpest downturn among major recycling markets this week, driven by tightening liquidity conditions and muted domestic demand. Local financing challenges continue to restrict buyer activity, with banks maintaining strict lending and LC issuance protocols.
The Bangladeshi taka strengthened modestly from 122.42 to 122.21 per USD, but this improvement failed to stimulate sentiment in Chittagong’s recycling yards. BEST OASIS observed that many newly built green-recycling facilities—established to comply with international environmental standards—have temporarily halted operations due to a lack of incoming tonnage. Several compliant yards already in operation remain either shut or fully occupied, leaving little room for immediate recovery.
A persistent and notable price gap between melting scrap and re-rollable steel plate continues to limit the competitiveness of domestic yards. This disconnect prevents recyclers from offering higher levels to shipowners, despite competitive pressure from India and Pakistan.
Nonetheless, Bangladesh still attracts owners of mid- and large-sized vessels, especially those seeking higher price points compared to the Indian market. Bulk carriers, tankers and large general-cargo ships continue to draw selective interest.
HMS 1&2 prices remained at $355, with shredded scrap at $360, reflecting a 0.69% weekly decline. Vessel prices softened significantly: containers at $430/LDT, tankers at $420/LDT and bulkers at $385/LDT, marking a 2.38% week-on-week reduction.
Pakistan: Stability with a Breakthrough in HKC Compliance
Pakistan continued to exhibit steady but subdued activity this week. While dollar-related challenges persist, the Pakistani rupee showed minimal movement, inching from PKR 282.04 to 282.03 per USD, essentially flat.
A major milestone, however, stood out: Prime Green Recyclers became the first yard in Pakistan to achieve full compliance with the Hong Kong Convention (HKC), verified by Bureau Veritas. This certification marks a historic achievement for Pakistan’s ship-recycling sector, long overshadowed by environmental and safety concerns. The development boosts long-term investor confidence and strengthens Pakistan’s position among globally recognized green recycling destinations.
Despite this positive progress, market momentum remained limited. Payment delays—commonly around three to four days—continue to constrain buyer confidence. While recyclers acknowledge the structural improvements, short-term activity remains quiet.
Scrap prices held steady at $355 for HMS 1&2 and $360 for shredded. Vessel prices also remained unchanged, reflecting a flat market: $415/LDT for containers, $400/LDT for tankers and $390/LDT for bulkers.
Türkiye: Stable but Muted Market with No Visible Shifts
Türkiye’s ship recycling market mirrored the previous weeks’ calm, with no significant changes in pricing or buyer interest. The Turkish lira weakened slightly from 42.37 to 42.47 per USD, but this movement did not materially impact domestic demand.
The Aliaga region maintained its stable but subdued pace, with recyclers adopting a conservative purchasing approach. Scrap prices reflected marginal week-on-week improvement: HMS 1&2 at $360 and shredded scrap at $380, marking a 1.24% gain. Vessel prices remained soft and unchanged: $280/LDT for containers, $270/LDT for tankers and $260/LDT for bulkers.
Crude and Exchange Rate Overview
Oil benchmarks remained volatile. Brent and WTI figures indicate fluctuations that continue to influence regional steel and recycling sentiment. In addition to the key USD exchange movements noted above, the broader forex environment continues to play an outsized role in recycler behavior, particularly in South Asia.
Vessels Sold This Week
Three vessels were confirmed sold for recycling this week, all for delivery in Bangladesh:
| Vessel Name | Type | LDT | Delivery Location | Price (USD/LDT) |
|---|---|---|---|---|
| LEO | Motor Tanker | 1,788 | Chittagong | Undisclosed |
| ZI YU LAN | RoRo/Container | 7,542 | Chittagong | Undisclosed |
| BOLD MARINER | Bulker | 7,507 | Chittagong | $430 |
The sale of the Bold Mariner at $430/LDT underscores Bangladesh’s continued appeal for large vessels, despite challenging market conditions.
Outlook: Cautious Sentiment Likely to Persist
BEST OASIS expects the cautionary tone across major recycling hubs to persist in the near term. Currency movements, oil price volatility and domestic liquidity constraints remain the key factors shaping market behavior. While Pakistan’s HKC-compliant milestone provides a positive narrative for the industry, sustained momentum will depend on broader economic stabilization and improved buying appetite.
As global shipping yields increasing numbers of end-of-life vessels, recyclers across South Asia and Türkiye continue to align operations with market reality—balancing regulatory compliance, financial constraints and shifting global steel dynamics.
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