Ship Recycling: India experienced a notable decline

Ship Recycling: India experienced a notable decline

World’s leading cash buyers for ships sending for recycling, BEST OASIS in their weekly ship recycling report opined that “India experienced a notable decline”.

BEST OASIS said “We extend our sincere gratitude to all who attended our cocktail party in Athens, Greece. Your presence contributed to the success of the event, creating an atmosphere of joy and celebration. Thank you for being a part of this memorable occasion.” 

In the global ship recycling market, various destinations are exhibiting distinct trends. In India, the market is experienced a notable decline over the past few days. This downturn is attributed to the recent elections, where the outcomes did not align with the anticipated majority, leading to market instability and a downward trend in steel prices expected to continue in the short term. Meanwhile, Bangladesh’s market has seen no changes from the previous week. The expected increase in import duties did not materialize, leaving prices and duties unchanged. Recyclers had anticipated a rise and acquired vessels in advance, but now future market directions depend on demand fluctuations. Pakistan’s market has been relatively quiet, with a slight increase in steel prices over the past week. Demand for vessels at lower levels remains, as participants await the federal budget announcement on June 12. Market activity is expected to further slow around mid-June due to the Eid holidays. In Turkiye, the steel market is facing weakened demand, yet recycling yards are seeing increased interest due to a limited supply of vessels for scrap. 

Oil prices are declining as bearish sentiment grows. This trend is driven by OPEC+’s announcement, which failed to meet market expectations, to extend voluntary production cuts only until Q3 2024 and maintain base cuts through the end of 2025.

INDIA

Local market prices fall post-elections, expected downward trend continues. 

The local market is experiencing a noticeable decline, with prices dropping by approximately INR 1,000 (equivalent to about 12.27 USD). This downturn has been observed over the past few days and is expected to continue into the upcoming week. The recent elections have played a significant role in influencing market sentiments. The outcomes, which did not align with the anticipated majority seats, have contributed to the current instability and downward price trend in the steel market. 

Given the current trends and market responses to the political climate, the market is expected to maintain its downward trajectory in the short term. 

The unexpected results of India’s elections highlight the volatile nature of its politics, with the ruling Party failing to secure a parliamentary majority, falling short of its 370-seat target. 

Beaching Dates 

07 June to 11 June 2024

19 June to 28 June 2024

02 July to 11 July 2024 

BANGLADESH

Market stagnation continues as import duties and booking prices remain unchanged. 

There has been no change from the previous week. The anticipation of an increase in import duties remained unmet, ultimately leading to no adjustments in the existing rates. Before the budget announcement, recyclers had proactively acquired vessels in expectation of a potential rise in import duties. However, this speculation did not materialize, and the import duties have remained unchanged. 

Additionally, the booking price levels have remained constant. The future direction of the market will largely depend on demand fluctuations. Looking ahead to next week, a clearer and more precise forecast of market conditions is anticipated. 

Bangladesh’s foreign currency reserves climbed to 20.41 billion USD following the addition of 1.09 billion USD in loans from the International Monetary Fund (IMF) and the Asian Development Bank (ADB). 

Beaching Dates 

07 June to 08 June 2024

22 June to 25 June 2024

05 July to 08 July 2024 

PAKISTAN

Market overview reflecting subdued activity as participants await the federal budget and upcoming Eid holidays. 

There has been no significant activity in the market recently. Steel prices have experienced a modest increase over the past week, reflecting slight shifts in market dynamics. 

There is consistent demand for vessels at lower levels, which remains feasible for market players. 

Market participants are cautiously awaiting the federal budget announcement in June. The market is expected to remain quiet around mid-June, especially with the approaching Eid holidays on June 17 and 18, which will likely decelerate market activities further. 

Beaching Dates 

Throughout the month

TURKIYE

 Steel market demand weakens while recycling yard demand rises due to vessel shortages. 

The current state of the steel market is characterized by a noticeable weakening in demand. 

Conversely, there is an increased demand for recycling yards. This increased activity is primarily due to a limited supply of vessels for scrap. In May, Turkey’s annual consumer inflation rate surged to 75.45%, the highest in 18 months, driven by rising costs in education, housing, and restaurants. The Finance Ministry reassured that the “worst is over.” 

Beaching Dates Throughout the month