Ship Breaking: Prices Leveling Off
As we enter the traditionally quieter monsoon season, it is of little surprise to see recycling markets remaining inert and quiet, with rains / flooding hampering production at yards in Chattogram and Alang laborers returning to their hometowns as recycling activities come to a seasonal crawl. This may have inadvertently triggered the recent leveling of sub-continent steel plate prices as steel output diminishes and plate prices stabilize / firm in reaction, according to GMS.
Although vessel prices have cooled off by $100/LDT in the sub-continent markets and about $250/MT in Turkey, global recycling sentiments remain in the doldrums given the rate of the recent declines. As such, there is no surprise to see minimal activity emanating from all markets at present, including the respective waterfronts that are displaying the shoddy state of current affairs.
Notwithstanding, global currency depreciations remain the primary source of heartburn for the ship recycling communities, as the worrying declines on steel prices seem to have comparatively stabilized and we hope it should start to show some signs of positivity in the coming weeks.
While there still remains a degree of caution and a prevailing nervousness to buy in local markets, there are unlikely to be firm/serious offers for owners and cash buyers alike, and this is part of the reason why even the marginal few candidates have started to dry up of late.
Of course, all freight sectors continue to be positively poised as most owners are now passing drydock on their aging vessels, rather than scrapping their older tonnage even when recycling rates are at historically firm numbers.
For week 27 of 2022, GMS demo rankings / pricing for the week are as below.