Markets - Recycling - Entering a quiet period

May 10 2019


Activity slowed last week as the cut-off date for the budget in Bangladesh and the incoming monsoon season hampered end buyer offers, considerably curtailing demand for later deliveries.

Indeed, the weather had started to worsen as cyclone ‘Fani’ battered the East Indian & Bangladeshi coasts last week.

Moreover, towage jobs will struggle to be approved from a Marine Warranty Surveyor/insurance perspective. So inevitably, there will be the much-expected slowdown in the supply of vessels arriving into the sub-continent, GMS said in its weekly report.

Also, during the seemingly unending rains of the monsoon season, many labourers return to their home towns as production on the yards slows, due to the constant rains hampering cutting/recycling activities, as much of the tonnage imported during the first half of the year gets gradually absorbed into the respective local markets.

There are also the upcoming Indian elections to consider, as many are hoping that the pro-business Mr Modi gets re-elected, which should be good for steel prices, currency and the ship recycling industry in general, but there has been the nagging suspicion that moods are beginning to shift and an unexpected surprise could well be on the cards.

Pakistan also remained firmly on the sidelines for another week and these are indeed troubled times for a once vibrant industry, with virtually no new vessels being imported this year (only smaller LDT general cargo vessels), as the currency too continues to struggle and steel mills close locally.

Brokers reported that the 2001-built Suezmax shuttle tanker ‘Nordic Spirit’ and the 1998-built Aframax shuttle tanker ‘Alexita Spirit’ were sold to Indian ‘green’ recyclers for $430 per ldt each.

They were listed as sold for further trading on some shipbrokers’ lists.

Bangladesh interests were said to have taken the 1996-built Handysize ‘Nelma’ for $440 per ldt.

 



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