The ship recycling market has maintained a passive tempo
The current market exhibits a notable lack of activity and a dearth of optimism regarding any potential alterations in its prevailing pattern. Contrary to expectations, the Indian market experienced a rather unexpected outcome following the Diwali festivities, as opposed to the projected surge, with a rather concerning decline observed in the domestic steel markets upon its reopening. The local steel market experienced a brief upswing followed by a subsequent downturn. Bangladesh is experiencing the negative consequences of declining foreign exchange reserves, and there is a noticeable absence of buying interest.
EU-flagged ship owners may now legally send their boats for recycling to demolition yards located in countries outside the Organization for Economic Cooperation and Development (OECD), as long as they comply with the conditions set by the European Union Ship Recycling Regulation (EU SRR). The European Union (EU) and the European Council have reached an agreement on a new definition of ‘waste’. However, this is subject to the condition that the receiving facilities can provide evidence of sustainable handling and disposal of the waste, in accordance with the regulations set by the European Union. This agreement is part of a proposed amendment to the EU Waste Shipment Regulation (WSR), which is anticipated to be officially approved by the end of this year.
Pakistan’s recent declaration of its accession to the Hong Kong International Convention for the Safe and Environmentally Sound Recycling of Ships (HKC) indicates that all of the major ship recycling nations are now members of the International Maritime Organization’s HKC. Now would be a significant step for Pakistani ship recycling yard owners to eventually modernize their facilities to match the substantially better Alang and Chittagong yards.
The market exhibits a state of softness, characterized by a lack of upward momentum. This market has not witnessed a surge in activity and the market went down here, primarily attributed to the presence of conflicting indicators within the steel market, thereby instilling a sense of caution among potential buyers. Economic activity has persisted at a subdued pace, characterized by a modest level of engagement. Steel demand in India is anticipated to increase at a 7% Compound Annual Growth Rate (CAGR) and reach 190 Million Tonnes (MT) by 2030. The construction and infrastructure sectors, are expected to be the primary drivers of this growth.
Preliminary government data indicates that during the initial seven months of the fiscal year started in April 2023, India’s imports of finished steel from China reached a level not seen in four years.
01 December to 02 December 2023
11 December to 19 December 2023
The local market saw a decline, as concerns over foreign reserves intensified. The local market is seeing a significant decline in activity and demand.
The buyers have exhibited a dearth of interest. This is due to the current scarcity of USD and the impending government election. Until the issue of depleted reserves is resolved, we will not see any progress in this market. According to the latest foreign exchange report published by Bangladesh Bank (BB) on November 23rd, the nation’s reserves amounted to 19.52 billion USD, as reported in the government’s suppression of opposition threaten to trigger further political unrest and economically disruptive demonstrations in Bangladesh prior to and possibly following the January 7 elections.
12 December to 15 December 2023
26 December to 29 December 2023
The prevailing market conditions lack activity and transactions; Ratification of the HKC appears to be a silver lining.
This week seemed quite tranquil for this market. One vessel was purchased by a local recycler, while the others are delayed due to the downturn in local markets. Twelve recyclers are collaborating with the shipbreaker association in an effort to transform their yard into a green yard. Initial surveys have been completed.
The price of local steel decreased this week. Despite the stock market reaching its greatest level in history, the economy is expanding slowly. The dollar is gradually gaining ground in opposition to the PKR and the dollar outflow increased significantly this month.
The UAE is poised to allocate a substantial financial investment, ranging from $20 to $25 billion, towards Pakistan through a series of meticulously crafted agreements.
Throughout the month
The current market has experienced a surge, characterized by a noteworthy upturn in positive trends. The market has seen a 15 USD increase in import prices and an 8 USD increase in local prices. Turkey’s economy grew by 5.9% in the third quarter, surpassing expectations. This growth was mostly fueled by household spending. However, due to the implementation of strict monetary policies aimed at reducing domestic demand and combating excessive inflation, economic activity is projected to decelerate in the future.
S&P Global upgraded its outlook on Türkiye from stable to positive on Thursday, while maintaining the nation rating at “B”.
Beaching Dates Throughout the month