Ship Recycling: Market showed no sign of improvement in India: BEST OASIS
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World’s leading cash buyers for ship sending for recycling, BEST OASIS in their weekly ship recycling market report opined that “This week was marked by stagnation and challenges across the four ship recycling destinations. In India, the market showed no signs of improvement due to a persistent shortage of tonnages, worsened by the ongoing monsoon season expected to last until late August or early September. Bangladesh faced similar difficulties, with declining demand exacerbated by the seasonal impact. Pakistan’s market remained on a downward trend with minimal activity despite recent tax adjustments. Turkiye saw subdued import demand and a shortage of vessels available for recycling, reflecting a quiet period in the industry.”
The global steel rebar market saw a slight 0.4% price drop by June end, reflecting ongoing supply and demand imbalances. Germany faced significant declines in steel sales and production due to slowdowns in construction and manufacturing, while China’s market struggled with high inventory levels, weak construction demand, and a significant 4% decline in home prices in May. Despite a robust manufacturing sector, Chinese mills were forced to offload excess inventory at reduced prices. Despite these challenges, potential price increases of steel rebars are expected in the US, Germany, and China, driven by robust demand, low inventories, and rising freight charges. Overall, while current challenges persist, anticipated demand and geopolitical factors suggest potential price recoveries, urging industry stakeholders to stay vigilant and adaptable.
Global oil demand is expected to peak in 2025, with both BP and OPEC forecasting positive growth. BP anticipates stable consumption until the end of the decade before a gradual decline. OPEC predicts robust demand through 2024 and 2025, driven by economic growth and increased air travel. Meanwhile, the IEA projects slower growth, with an increase of just under a million barrels per day (bpd) this year and next, mainly due to temporary economic issues in China. Overall, BP and OPEC’s positive forecasts indicate a healthy, near-term energy market. It will be interesting to see how these projections unfold.
India
The market remains soft and unchanged amid softness, lack of tonnages, and monsoon impact.
The market remains unchanged, continuing to exhibit softness and lack of positive development, with no significant improvements observed in recent weeks. Additionally, the market is experiencing a lack of tonnages, further contributing to the sluggish performance.
The current monsoon season, with heavy rains impacting various sectors, is contributing to the industry’s slowdown, a trend expected to persist over the next 1-2 months until late August or early September.
Cheap Chinese steel imports have disrupted India’s ship recycling market, causing a 25 USD-per-tonne drop in rerolled steel prices, alongside the increased availability of competitively priced steel from other global sources, as highlighted in our reports previously.
Beaching Dates
19 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 slump driven by low demand and monsoon impact; clarity expected in coming days.
The market in Bangladesh is grim, similar to the Indian market, with a further decline due to a notable lack of demand and the impact of the monsoon season.
The extent of this downturn will become clearer in the coming week.
The opening and settlement of LCs fell slightly in June, with banks opening 5.17 billion USD in LCs compared to 6.83 billion USD in May, though this was a 6% increase from the previous year. In FY ’24, 68.19 billion USD in import LCs were opened, a 1.85% rise from 66.95 billion USD in FY ’23. Policymakers cited Eid vacations as the main reason for the June decrease.
Beaching Dates
21 July to 24 July 2024
04 August to 07 August 2024
19 August to 22 August 2024
Pakistan
The price for Recycling Ships in the Pakistan Market is stagnant and downward, largely on the sidelines with no significant developments.
The market remains unchanged and sentiments are downward, with no significant developments, staying largely on the sidelines.
As reported in the previous week, the unforeseen tax projected to increase costs by Rs. 3000 per ton (approximately 10 USD per ton) has not affected the prices of finished goods or vessels. Very few inquiries and limited buyer interest, resulting in minimal market impact.
The government’s current push to finalize a new bailout package with the IMF this month underscores progress in negotiations with the global lender. Concurrently, the
IMF’s requirement to abolish the Pakistan Sovereign Wealth Fund due to governance concerns poses a significant obstacle to the country’s initiative for a state-owned investment entity.
Beaching Dates
Throughout the month
Türkiye
Price for Recycling Ships in Türkiye Market faces weak import demand and low vessel recycling supply, with no recent activity.
The market continues to experience weak demand for imports, while simultaneously facing a low supply of vessels available for recycling. There has been no activity in this market lately.
The lira hit a new record low against the U.S. dollar, falling to 32.9945, despite months of relative stability following years of decline. In 2024, the lira has depreciated by over 11% 0
against the dollar and more than 70% since the beginning of 2023. The Turkish Central Bank recently decided to hold interest rates steady at 50% for the second consecutive month.
Beaching Dates Throughout the month
