After what has been a rather dour period for the international ship recycling markets, the first glimmers of stability finally started to emerge last week.
After local steel plate prices declined by almost $50 per ldt, currencies battled a firming US dollar and recycled steel from ships imported over the summer months, increasingly failed to shift from domestic yards (resulting in growing stockpiles), the stabilising prices are a welcome breath of fresh air, especially to cash buyers and shipowners who are still looking to offload their prospective units, GMS said in its weekly roundup.
Over several weeks, China has entered into a state of artificial stasis as the Communist Party Conference continues locally. However, with news that President Xi is undertaking another five-year stay at the helm, hopes are high that this will in turn, help boost the domestic economy once again. For the time being however, many industries (including the domestic ship-recycling sector) have been in lockdown whilst all eyes fall on Beijing as the seldom seen Communist Party Conference concludes.
The ship recycling market in China has also endured a near and total shut down as officials attempt to tackle pollution/environmental concerns and bring figures in line with what is expected to be the outcome of this critical conference. The ongoing shut down has now resulted in levels declining by about $30 per ldt, subsequently securing China’s tail-end position in the market rankings. The domestic steel industry has also been sluggish and this has had a knock on effect on some of the competing markets.
As indications from the various markets have slipped over the recent weeks and Pakistan is now the only market where an $+400 per ldt offer can be expected for the right unit, it is safe to presume that the industry overall is now a sub-$400/tonne sector. Given that the supply of tonnage (especially from the drybulk and container sectors) has diminished considerably of late, an overall slowdown of potential candidates may help revive prices in the near future, GMS concluded.
Brokers reported that the 1995-built MR ‘Admiral 1’ had been committed to Bangladesh recyclers at an unknown price level, while Indian recyclers were said to have taken the 1990-built Handysize ‘Champion’ for $395 per ldt.