GMS Reports Ship Recycling Industry Frustration

It has been another frustrating week across all of the major ship recycling destinations, with prices marooned / flat and businesses yet to fully resume at pace following the conclusion of Eid holidays, reports GMS in its weekly report for Week 28, 2023.

GMS recalls the good news that Bangladesh has completed its accession to the Hong Kong Convention (HKC) as further progress is made in recycling markets before the convention formally enters into force.

Meanwhile, the lack of tonnage is also starting to ease as prices seem to further correct and stabilize and ship owners and cash buyers begin to accept that current prices are here to stay. Vessel owners with units on the verge of surveys are also making the decision to sell.

Meanwhile, constant rain means sub-continent yards are operating at minimal labor capacity.

Bangladeshi steel mills too are yet to fully resume operating at capacity, adding to the muted demand for vessels. Prices remain below expectation for available tonnage.

Pakistan recently received encouraging news of an IMF loan that will see about $3 billion committed over the next nine months, helping ease the liquidity crisis in the country. The first instalment of $1.2 billion has already been received, bringing some much-needed economic relief and stability. GMS says they may re-enter the ship recycling realm once commercial banks resume issuing letters of credit.

Amidst the ongoing scarcity of tonnage, the Turkish market faced further downfalls in fundamentals this week.

For week 28 of 2023, GMS demo rankings / pricing for the week are: