The ship recycling market is still seeing sub par levels of activity. In its latest weekly report, Best Oasis (www.best-oasis.com), a leading cash buyer of ships, said that “the Indian market remains cautious this week as persistent and unpredictable dollar fluctuations continue to affect local sentiment, keeping buyers hesitant. Purchasing interest for new units, particularly larger vessels, remains limited, with negotiations becoming increasingly difficult under current currency volatility. Two new sales appear to have been concluded; however, most of the tonnage being circulated still consists of sanctioned or “dark fleet” vessels. Overall, buyers continue to proceed carefully, preferring further clarity on the dollar before committing to additional tonnage”.

Meanwhile, in Bangladesh, “market conditions have weakened sharply, with local buyers remaining extremely cautious amid tightening liquidity in the money market. Several newly built green-recycling yards have halted operations due to the absence of incoming vessels, while many existing compliant facilities remain down or fully occupied. A notable gap persists between melting scrap and plate prices, further limiting yard competitiveness and keeping overall buying activity subdued. Mid- and large-sized vessels still attract some degree of interest, and owners seeking higher price levels—particularly compared to India, are encouraged to consider Bangladesh as a viable recycling option”, Best Oasis said.

Source: Best Oasis

The company added in its report that in Pakistan, “market sentiment remains stable, though buying interest continues at lower levels as dollar-related challenges persist. Pakistan has finally achieved a major milestone with Prime Green Recyclers becoming the first yard in the country to obtain full HKC compliance, verified by Bureau Veritas. Despite this positive development, payment delays of around three to four days remain common, keeping overall activity cautious. While the certification has boosted long-term confidence, near-term momentum remains limited. The Turkish market remains stable and unchanged, with no notable movement in pricing or buying activity. Conditions mirror previous weeks, with sentiment and demand maintaining a steady but muted pace. No new indicators suggest any immediate shift in direction”, Best Oasis concluded.

In a separate report, shipbroker Intermodal said that “the ship recycling sector continues to witness constrained activity, with the robust freight environment leading to the postponing of recycling decisions by shipowners. The Indian recycling market remains subdued as several headwinds converge to dampen activity. Less competitive pricing coupled with adverse currency fluctuations, has created challenging conditions. The weakening rupee poses hurdles not only for the recycling sector but across the broader economy, as it undermines investor confidence. These factors have fostered an uncertain outlook, prompting most market participants to adopt a wait-and-see approach. Meanwhile, the steel market has experienced divergent price movements: local steel plate prices have declined, while scrap prices have firmed. This dynamic reflects buyers’ pivot toward domestic scrap procurement to mitigate the heightened foreign exchange risks. Gadani experienced a quiet week with limited activity.

Source: Intermodal

Despite willing buyers, few vessels were circulated. In the steel market, a modest uptick in Chinese Hot Rolled Coil import prices ($5-6/ mt) offers some indirect relief to recyclers, though low-cost Chinese steel imports continue to erode yards’ buying capacity. On the compliance front, news of Pakistan’s first ship recycling facility achieving HKC certification is uplifting market sentiment and enhancing the country’s international standing as a ship recycling destination. The Chattogram ship recycling market is challenged by declining vessel imports and liquidity constraints, though some transactional activity persists. Purchasing interest centers on mid-sized and larger tonnage, with owners willing to conclude deals at Bangladesh’s attractive pricing. However, sentiment is hindered by a sluggish steel sector, with declining local plate prices. Ongoing political instability, coupled with cheap steel imports, continues to undermine business sentiment. In Turkey, the market remains flat with a sluggish flow of recycling candidates, though this is partly seasonal. On the economic front, high inflation and continued Lira depreciation continue to weigh on economic activity and dampen business confidence”, the shipbroker concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide