Ship Recycling: Industry facing significant challenges: BEST OASIS
Worl’s leading cash buyer for ships sending for recycling BEST OASIS in their weekly ship recycling report opined that “this week, the ship recycling industry faced significant challenges across multiple regions. In India, the market has experienced a consistent decline over recent weeks, intensified by a pronounced lack of local demand and a shortage of available tonnage. Additionally, extensive and persistent rainfall has further hindered market activities. In Bangladesh, recycling activities have remained sluggish since last month, even before the recent emergency. The impact of the riots on the market will become clearer next week, contingent on the government’s response. In Pakistan, the market continues to exhibit lethargy, with demand further diminishing and no signs of revival, prolonging an extended period of inactivity. Similarly, Türkiye’s market struggles with low supply and overall activity, mirroring subcontinent yards’ broader challenges.”
In June 2024, global crude steel production for 71 countries reached 161.4 million tonnes (MT), a 0.5% increase from June 2023. China produced 91.6 MT, up 0.2%, while India produced 12.3 MT, up 6.0%. Japan’s output fell to 7.0 MT, down 4.2%, and the U.S. produced 6.7 MT, down 1.5%. Russia’s production was 6.0 MT, down 4.1%, and South Korea’s fell to 5.1 MT, down 7.2%. Germany produced 3.2 MT, down 8.9%, while Türkiye and Brazil increased production to 3.1 MT and 2.9 MT, up 4.3% and 11.8%, respectively. Iran produced 2.6 MT, down 8.5%.
India
The market downturn was driven by low demand, tonnage shortages, and persistent rainfall.
The market has been experiencing a consistent decline over the past few weeks, with a notable further downturn observed recently.
Contributing factors include a significant lack of local demand and a shortage of available tonnage. Additionally, extensive rainfall has been widespread across the country.
The Union Budget for 2024–25 includes cutting import duties on key raw materials for the steel industry and increasing spending on infrastructure and affordable housing.
Ferronickel imports will no longer face a 2.5% duty, 25 critical minerals will have zero duty, and the exemption for ferrous scrap will extend until March 31, 2026.
Large imports of Chinese steel are impacting Indian steelmakers, who are currently negotiating with the government for fair market conditions. The weakened global steel market and increased imports into India have squeezed local steelmakers’ margins, despite growing domestic demand.
Beaching Dates
26 July to 27 July 2024
31 July to 08 August 2024
17 August to 26 August 2024
Bangladesh
Price for Recycling Ships in Bangladesh Market uncertainty slows recycling activities, clarity expected next week.
Recycling activities have been slow since last month, even before the emergency, and continue to be sluggish. Clarity on the market and the recent impact of the riots will be clearer next week, as it remains to be seen how the government will bounce back.
Dhaka resumed normal activities as the curfew was lifted following a four-day shutdown due to university student protests over government job quotas. Offices reopened, and broadband internet was largely restored, although social media remained suspended.
Beaching Dates
04 August to 07 August 2024
19 August to 22 August 2024
02 September to 05 September
Pakistan
The price for Recycling Ships in Pakistan Market remains sluggish and quiet as demand continues to decline further.
The market continues to exhibit sluggishness, with no signs of improvement. In fact, the demand has decreased even further. This market has been relatively quiet for quite some time now.
Pakistan’s central bank is expected to reduce its key interest rate again in its upcoming policy meeting, the first since a staff-level agreement with the IMF and the new state budget. In June, the central bank cut the rate by 150 bps from a record 22 percent, its first reduction in nearly four years, aiming to boost growth amid declining retail inflation. Inflation has since continued to slow.
Beaching Dates
Throughout the month
Türkiye
The price for Recycling Ships in Türkiye Sluggish market mirrors subcontinent yard challenges with low ship recycling and activity.
The market continues to experience sluggish conditions. Both the supply of ships for recycling and overall market activity are notably low. This situation aligns with the current conditions in subcontinent yards, reflecting similar market challenges.
Türkiye’s Central Bank maintained interest rates at 50%, after recent reports indicated a slowdown in the country’s high inflation for the first time in eight months. The Monetary Policy Committee decided to keep the rate unchanged as June’s year-on-year inflation, although reduced, still exceeded 70%.
Beaching Dates Throughout the month
