India’s Ship Recycling Sector Shows Signs of Revival Amid Strengthening Fundamentals: STAR ASIA

India’s Ship Recycling Sector Shows Signs of Revival Amid Strengthening Fundamentals: STAR ASIA

Alang, Gujarat – July 29, 2025

After months of subdued activity, a renewed sense of optimism is returning to India’s ship recycling sector—particularly in the historic hub of Alang. Market sentiment has begun to shift as domestic steel and iron ore prices firm up, prompting a modest but meaningful re-engagement by buyers and recyclers alike.

The improved pricing environment is breathing life into the marketplace after a prolonged quiet spell. While caution remains the prevailing sentiment among many key players, some recyclers are now stepping off the sidelines to pursue fresh opportunities. The activity, still tentative, suggests that India’s shipbreaking yards may be on the cusp of a broader market revival—one driven by both improving domestic fundamentals and a renewed appetite for larger, higher-value vessels.

Cautious Optimism Grips Alang

India’s Alang, home to one of the world’s largest ship recycling hubs, has seen a noticeable increase in buyer interest in recent days. This revival comes on the heels of a modest rally in local steel prices and rising domestic demand for iron ore, both of which underpin the recycling industry’s profitability.

However, the optimism is tempered with realism. “This is not a runaway boom,” one industry insider cautioned. “It’s a cautious reawakening. Players are waiting to see if the improved fundamentals hold before making long-term commitments.”

Despite this guarded outlook, Alang has recently secured several high-value units—a signal that some yards are eager to fill dormant plots. Among them are two LNG carriers, APIA and TECHNO, with light displacement tonnages (LDT) of 34,060 and 34,047 respectively. The arrival of such sizable assets suggests that recyclers are willing to bet on future demand returning in earnest.

July Activity at Alang: Bigger Ships, Stronger Signals

Recent beaching data indicates growing momentum:

Several vessels, including GREEN EGERSUND and CONICO ATLAS, remain at anchor, awaiting beaching. Their arrival underscores recyclers’ growing willingness to re-engage the market after a lull marked by global demo vessel shortages.

Bangladesh Recyclers Regain Momentum—But Cautiously

In Chattogram, Bangladesh, a slow return to market activity is also being observed. Though the recovery here is still nascent, recyclers who have achieved compliance with the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC) are beginning to take the lead.

With 15 yards now certified under HKC, Bangladesh’s capacity for compliant recycling is steadily increasing. However, the industry continues to navigate the complexities of documentation, audit trails, and detailed ship recycling plans that the HKC requires.

This compliance shift is not without its growing pains. “There is a steep learning curve,” said a yard owner in Chattogram. “But those who have made the investment in certification now have a first-mover advantage at the bidding table.”

Beaching reports from July confirm several notable arrivals, including two LNG vessels—SUR and RASI—each with over 30,000 LDT, signaling that even large-scale assets are now being entrusted to HKC-aligned yards.

Chattogram Activity Snapshot

The arrival of larger units is being viewed as a vote of confidence in Bangladesh’s evolving compliance framework and a sign that international sellers are starting to recognize the country’s reform efforts.

Gadani Still Cautious, But Compliance Push Underway

Pakistan’s Gadani remains notably quiet, with minimal new activity reported in July. While the national economy is gradually stabilizing, local recyclers are holding back from new acquisitions.

Yet, behind the scenes, several yards are moving to secure HKC compliance—widely seen as a prerequisite for attracting quality tonnage in the future. The twin forces of economic pragmatism and regulatory pressure are pushing the region toward transformation.

Two bulkers—WINCA and TWIN—remain anchored and awaiting beaching, possibly pending financial closure or final documentation.

Turkey: Stable But Subdued

Meanwhile, in Aliaga, Turkey, recyclers are continuing with a subdued, needs-based purchasing strategy. Despite the lack of urgency, prices have remained stable, reflecting a balanced supply-demand dynamic.

“Yards are only buying what they need now,” said a market observer. “There’s no appetite for speculation, but there’s also no panic.”

Ferrous Scrap Markets: A Mixed Regional Landscape

India’s imported scrap market remains sluggish, but there is optimism building. While UK-origin shredded scrap has been offered at US$360–365/ton CFR, sellers are holding back, drawn by stronger prices in Pakistan, where levels of US$385/ton CFR are reported.

India’s domestic scrap demand, however, is rebounding. As steel mills prepare for increased output, expectations are growing that they will re-enter the global market soon, which could lift import activity and improve price traction.

Pakistan, by contrast, is leading the region in pricing and volume. Despite the monsoon affecting mill operations, local buyers have remained aggressive, keeping the country a preferred destination for international suppliers.

Bangladesh continues to face headwinds. Domestic steel demand is weak, prompting mills to delay raw material purchases. A price gap persists between sellers and buyers, with offers for shredded scrap in the US$375–380/ton range, while bids are coming in closer to US$368–370/ton.

Turkey saw prices soften slightly, but supply remained sufficient, ensuring no sharp corrections.

Currency & Bunker Watch

Exchange Rates (as of July 25):

• USD/INR: 86.50 (down 0.46% WoW)

• USD/BDT: 122.19 (up 0.68%)

• USD/PKR: 283.80 (down 0.35%)

• USD/TRY: 40.55 (up 0.45%)

Bunker Prices (USD/ton):

• Singapore: VLSFO $518 | HSFO $413 | MGO $679

• Fujairah: VLSFO $514 | HSFO $397 | MGO $739

• Rotterdam: VLSFO $510 | HSFO $437 | MGO $710

The softer USD in most South Asian markets could marginally help recycling economies as it eases import costs for fuel and equipment.

Outlook: Competitive Dynamics to Intensify

The weeks ahead are likely to be defined by increasing competition among South Asian yards as more HKC-compliant facilities come online. Alang appears well-positioned to capitalize on its recent momentum, particularly if steel price strength persists.

Bangladesh will need to navigate operational transitions while building confidence among international stakeholders. Pakistan’s fate, meanwhile, hinges on how quickly HKC efforts can be scaled up to meet future compliance requirements.

Turkey remains a stabilizing force, with pricing discipline and operational consistency, but limited growth prospects in the near term.

As global tonnage availability remains low, buyers across the region will be watching for every opportunity—and every shift in fundamentals—with heightened attention.

Author: shipping inbox

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