The high profits and exogenous factors show a reduction in ship recycling in maritime transport; According to a report by VesselsValue on behalf of ShippingWatch, current good finances in containers, dry bulk and tankers have seen shipping companies scrap far fewer older vessels this year, ShippingWatch.com reports.
The scrapping or recycling of older ships at the end of their useful life is down markedly in the first half of the year compared to the same period last year, according to a report by VesselsValue on behalf of ShippingWatch.
While 323 ships were sent to scrap in the first half of 2021, only 187 end-of-life ships were sold for scrap in places like Bangladesh, India and Pakistan during the first six months of this year.
Likewise, according to Marine Link, as we enter the monsoon season: a prevailing seasonal wind in South and Southeast Asia, blowing from the southwest between May and September and bringing rain (the wet monsoon), or from the northeast between October and April (the dry monsoon), traditionally quieter, it is not surprising to see recycling markets remain inert and quiet, with rains and floods hampering production in Chattogram yards and Alang workers returning to their jobs. places of origin as recycling activities come to a seasonal end. This may have inadvertently triggered the recent leveling off of subcontinent steel plate prices as steel production declines and plate prices stabilise/firm in reaction, according to GMS.
Although vessel prices are down by $100/LDT in subcontinent markets and around $250/MT in Turkey, global recycling sentiments remain depressed given the rate of recent declines. As such, it is not surprising to see minimal activity emanating from all markets at present, including the respective waterfronts showing the shoddy state of affairs at present.
Nonetheless, global currency depreciation remains the main source of distress for the ship recycling communities, as the worrying declines in steel prices seem to have leveled off comparatively and we expect them to start showing some positive signs in the coming years. weeks.
While there is still a degree of caution and a prevailing nervousness to buy in local markets, there are unlikely to be any firm/serious deals for both homeowners and cash buyers, and this is part of the reason why even the few fringe candidates have started to dry up of late.
Of course, all freight shipping sectors remain in a positive position, as most owners are now dry-docking their aging ships, rather than disposing of their older tonnage, even as recycling rates are in historically firm numbers.
For week 27, 2022, the GMS demo pricing/rankings for the week are as follows:
Source: ShippingWatch – Marine Link