Tonnage availability has been hard to come by in the ship recycling market. In its latest weekly report, shipbroker Clarkson Platou Hellas said that “the supply of tonnage to the market has slowed considerably with only a handful of units being circulated into the market. The question is whether they will be sold for recycling or if some traders come out of the woodwork whilst charter rates improve. Clients of Evergreen this week circulated two sister container vessels, the ‘Ever Unific’ and the ‘Ever Uberty’, both built 1999 and of about 24,300 ldt. Offers are due to be registered by 7th April, 2023 and reports suggest that there are some potential trading buyers showing interest so time will tell whether they find have a final voyage to a recycling yard. There have been reports that the steel markets in Bangladesh have weakened this week, some parties suggesting the equivalent of about USD 40-50/ldt but as yet, we are not seeing signs of such a drop. With Ramadan now under way and the forthcoming global Easter holidays creeping up, this quiet and inactive period looks set to continue for several weeks”.
In a separate weekly report, shipbroker Allied added that “the feeling of recent weeks where high prices were matched with a modest stream of vessels, has now all but dissipated. Falling steel demand will likely lead to lower steel prices and likely contributed to a drop in offered prices. Lower activity in Bangladesh and Pakistan would be expected as part of the onset of Ramadan, although it appears to have been compounded with improved earnings (relative to a month ago) to result in no activity of note this week; with exceptions being a small research vessel reportedly heading to Denmark and the Chinese-Built Shang Hang 68 sold on an ‘as is’ basis China.
The financial situation across the Indian Sub-continent remains largely unchanged and the limited available tonnage means that Bangladesh and Pakistan are not losing out to Indian breakers as much as they might otherwise be. Despite the perceived ‘rush’ of sales earlier this year, the number of vessels sold is well below the trend of recent years, although low dry bulk earnings have resulted in 22 vessels sent for recycling so far this year – high in comparison to the 54 recycled throughout the entirety of 2022”.
Meanwhile, GMS (www.gmsinc.net), the world’s leading cash buyer of ships added that “as the Holy month of Ramadan descends across much of the sub-continent and Turkey, it has once again been a far quieter week in terms of sales activity, and sentiments do seem to be more muted, with focuses currently shifted elsewhere. With Container & Dry Bulk rates firming once again, the number of firm sales candidates also appears to have dried up and this is leaving keen recyclers empty handed for yet another week. While there have been a plethora of sales at the start of the year, particularly in the Capesize Bulker and Container sectors, the supply has surprisingly slowed so much of late, it nearly seems like it has timed itself in sync with declining sub-continent prices.
Steel plate prices had also found themselves going through a phase of incredible volatility but seem to have stabilized (comparatively) more since, and there is still interest from the Indian and Bangladeshi markets to acquire at the present overall levels, which are hovering close to or even well above USD 600/LDT on choice units. L/Cs remain the chief concern in Bangladesh amidst a chronic lack of liquidity in the country, and several L/Cs are left waiting for Central Bank approval, which is inevitably leading to local delays on boardings, payments, and beachings. Owners are therefore reminded that it is not exactly business as usual (especially in Pakistan and Bangladesh to an extent), despite several sales taking place there recently. Finally, at the far end, Turkey remains unchanged with its weekly (and marginal) fluctuations in import and local steel plate prices, as does the Lira continue on its seemingly unrelenting decline against the U.S. Dollar”, GMS concluded.
Nikos Roussanoglou, Hellenic Shipping News Worldwide