Ship Recycling: Strong local demand robust market: BEST OASIS
The recycling market across various regions exhibits varying trends and challenges. In India, the market is experiencing a robust upward trajectory, driven by strong local demand and a consistently healthy demand for steel, which bolsters the market’s overall health and maintains its growth. Conversely, in Bangladesh, market demand remains tepid and unchanged, displaying a lack of aggressiveness. Additionally, the Central Bank of Bangladesh’s adjustment of Taka’s value complicates financial transactions, affecting the recyclers’ ability to arrange LC at a favourable rate. Pakistan’s recycling market is facing a period of stagnation, with no significant activity or momentum, making it difficult to predict when the market might pick up again. Similarly, Türkiye’s market also shows no significant changes from the previous week, maintaining a steady state in market activities.
China’s steel industry is currently facing significant challenges due to overcapacity, signalling a potential end to its era of dominance. Despite an increase in steel production, a downturn in the property market and a slowdown in infrastructure spending have led to a steep plunge in prices. These factors collectively contribute to heightened concerns that the sector may be on the brink of a severe downturn. Moreover, international reactions have intensified, with Washington calling for higher tariffs on Chinese steel imports, Chile making moves to curb shipments, and Vietnam considering a probe into the imports. The situation poses substantial risks not only domestically but also in terms of international trade tensions, underscoring the need for strategic adjustments in the industry.
INDIA
Consistent performance and strong steel demand drive a sustained upward trajectory.
The demand for steel remains strong, significantly bolstering the overall market health and sustaining the upward momentum.
Demand for steel in India is expected to grow by 8-10% in fiscal year 2024/2025, influenced by Chinese steel production levels and export volumes, which will continue to impact global steel prices and costs in India.
Beaching Dates
10 May to 13 May 2024
21 May to 29 May 2024
03 June to 11 June 2024
BANGLADESH
Persistent demand stagnation and currency devaluation forecast Market downturn
The demand remains unchanged, continuing to lack aggressiveness. This has been a consistent trend observed over recent times.
The Central Bank of Bangladesh has adjusted the value of the Taka, increasing it from to approximately 117 against the dollar. This change complicates existing LC issues further, as recyclers had been arranging LCs at a higher rate (120-126 Taka) even when the official rate was at 110. The depreciation of the Taka and complications related to LCs are expected to negatively impact the booking prices shortly. The market appears to be heading towards a downturn.
Beaching Dates
22 May to 25 May 2024
05 June to 08 June 2024
22 June to 25 June 2024
PAKISTAN
The market remains stagnant, making It difficult to predict how long inactivity will last.
The market continues to exhibit a consistent lack of activity and momentum, mirroring trends observed in previous weeks. This stagnation presents challenges in forecasting the duration of this period of inactivity.
Iron and steel prices saw a slight decrease on a month-on-month basis in May 2024, continuing a downward trend. This development comes as the economy shows signs of recovery, despite facing ongoing challenges. Individuals planning to initiate construction projects soon may benefit from the lower costs of these materials.
Pakistan is seeking to renew 12 billion USD in loans to meet budget targets ahead of IMF discussions. The effort aims to address external liabilities before the IMF team’s arrival. Additionally, Pakistan anticipates securing over 1 billion USD in new IMF funding to bolster its insolvent economy.
Beaching Dates
Throughout the month
TURKIYE
The market remains stable with no significant changes from the previous Week.
The market continues to show no significant changes from the previous week. There remains a steady state in market activities.
Türkiye has achieved a 12 per cent year-on-year increase in its exports of steel products. This growth demonstrates a notable enhancement in the steel sector, contributing positively to the national economy. The head of Turkey’s central bank has revised the year-end inflation forecast upward, acknowledging the ongoing surge in consumer prices.
Beaching Dates Throughout the month
