Ship Recycling Markets in Pakistan and Bangladesh Stabilize
Over the past five weeks, the ship recycling markets in Pakistan and Bangladesh have shown signs of stability and increased activity during bidding. However, according to cash buyer GMS, the start of 2024 has been surprisingly quiet for the ship recycling industry, defying the expectations of many observers.
One contributing factor to this subdued start is the impact of Houthi attacks, which have led to firmer trading markets, delaying the usual surge in activity that typically follows the New Year in the sub-continent ship recycling markets.
Despite the efforts of Bangladeshi and Pakistani markets to maintain recycling prices and demand, there are few viable options available for recycling. This has resulted in a delay in the anticipated first-quarter surge in recycling activity, which may not materialize until later in the year.
India has been the most active player in the ship recycling industry in 2024 so far, particularly due to the conclusion of contracts for MSC containers at certain yards compliant with the Hong Kong Convention (HKC). However, fluctuating local steel plate prices and the instability of the Indian Rupee have led to cautious sentiment among buyers in Alang, resulting in the lowest sub-continent levels of activity.
In summary, while the Pakistani and Bangladeshi markets have stabilized and shown increased aggression in bidding, the overall ship recycling industry has experienced a quieter start to 2024 than expected, with challenges such as geopolitical tensions and volatile local economic factors contributing to the subdued activity levels.