Demolition Market Comes Back to “Life”, Albeit in “Slow Motion”

0 comments

Demolition Market Comes Back to “Life”, Albeit in “Slow Motion” | Hellenic Shipping News Worldwide

in Hellenic Shipping News 24/10/2019

Ships’ recycling activity has been the negative “star” of today’s shipping market, with tonnage sold for scrap failing to reach Southeast Asias’ shores. As a result, concerns are bound to be raised on the future balance of supply-demand in the maritime segment. In its latest weekly report, shipbroker Clarkson Platou Hellas said that “with what has been one of the quietest years on record to date, we finally saw a trickle of tonnage filter into the market this week which has started to resemble a functioning market once again. There have even been a small flutter of sales with one large LDT dry unit (see below) in particular catching Owners’ eyes and it remains to be seen whether this is another ‘false dawn’ or that we start to see more units entering the market place over the final couple of months of the year. As we approach the Diwali celebrations towards the end of this month, some buyers may, per the seasonal norm at this time of year, start searching eagerly for fresh tonnage where a ‘pick up’ in price levels usually occur”.

“But buyers may need to be more aggressive than ever in order to lock in tonnage with freight markets still performing strongly, swaying Owners attentions away from the recycling destinations. Whether the latest increase in price levels has an effect on Owners decisions remains to be seen! The problem we do face is that there still seems to be only one dominant market at present, Bangladesh, which leads the way for pricing and demand. Pakistan continues to be a ‘non-existent’ recycling destination, for almost 18 months, and India looks set to continue to concentrate on specialist units rather than being aggressive on large LDT market tonnage”, Clarkson Platou Hellas concluded.

Meanwhile, in a separate note, GMS, the world’s leading cash buyer added that “following a brief few weeks of positivity, subcontinent markets are once again embarking on a dispiriting downwards descent, with End Buyers withdrawing their offers amidst declining levels from India, Bangladesh and Pakistan. There appears to be little stability to cling on to, with Local Recyclers nervous about further declines ahead and prevaricating over an imminent influx of tonnage through the last quarter of 2019 / first quarter of 2020 (that is just over the horizon). Notwithstanding, present-day reality is that there are very few vessels being currently proposed for demolition, with all charter markets (particularly, larger LDT tankers) that are currently flying. Moreover, scrap pricing almost seems to be in a complete contradiction to the trading markets, with worrying fundamentals underpinning an overall larger malaise at play in the subcontinent markets (and Turkey, to a good extent). Currencies, especially in both India and Pakistan, have taken a battering over the course of the year (especially the Indian Rupee, which has depreciated by almost 2% over the past couple of months alone), whilst local steel plate prices have declined alarmingly in all locations over the summer / monsoon months, by about USD 75/LDT. On the one hand, during the peak of the market earlier this year, industry players were frequently witnessing trades into the mid (and higher) USD 400s/LDT; on the other hand, we have (of late) seen several fixtures (admittedly on poorer units) in the low USD 300s/LDT. As such, given the overall performance of the industry, a healthy majority of End Buyers in the subcontinent markets are simply choosing to not offer at all – struggling either with their banking limits, or fearful about the lack of stability that is continually festering in the various subcontinent recycling markets”, GMS concluded.


Nikos Roussanoglou, Hellenic Shipping News Worldwide

Leave a Reply

SSCP   CAS-002   9L0-066   350-050   642-999   220-801   74-678   642-732   400-051   ICGB   c2010-652   70-413   101-400   220-902   350-080   210-260   70-246   1Z0-144   3002   AWS-SYSOPS   70-347   PEGACPBA71V1   220-901   70-534   LX0-104   070-461   HP0-S42   1Z0-061   000-105   70-486   70-177   N10-006   500-260   640-692   70-980   CISM   VCP550   70-532   200-101   000-080   PR000041   2V0-621   70-411   352-001   70-480   70-461   ICBB   000-089   70-410   350-029   1Z0-060   2V0-620   210-065   70-463   70-483   CRISC   MB6-703   1z0-808   220-802   ITILFND   1Z0-804   LX0-103   MB2-704   210-060   101   200-310   640-911   200-120   EX300   300-209   1Z0-803   350-001   400-201   9L0-012   70-488   JN0-102   640-916   70-270   100-101   MB5-705   JK0-022   350-060   300-320   1z0-434   350-018   400-101   350-030   000-106   ADM-201   300-135   300-208   EX200   PMP   NSE4   1Z0-051   c2010-657   C_TFIN52_66   300-115   70-417   9A0-385   70-243   300-075   70-487   NS0-157   MB2-707   70-533   CAP   OG0-093   M70-101   300-070   102-400   JN0-360   SY0-401   000-017   300-206   CCA-500   70-412   2V0-621D   70-178   810-403   70-462   OG0-091   1V0-601   200-355   000-104   700-501   70-346   CISSP   300-101   1Y0-201   200-125  , 200-125  , 100-105  , 100-105  , CISM   NS0-157   350-018  , NS0-157   ICBB  , N10-006 test  , 350-050   70-534   70-178   220-802   102-400   000-106   70-411  , 400-101   100-101  , NS0-157   1Z0-803   200-125  , 210-060   400-201   350-050   C_TFIN52_66  , JN0-102  , 200-355   JN0-360   70-411   350-018  , 70-412   350-030   640-916   000-105   100-105  , 70-270  , 70-462   300-070  , 300-070   642-999   101-400   PR000041   200-101  , 350-030   300-070  , 70-270  , 400-051   200-120   70-178   9L0-012   70-487   LX0-103   100-105  ,