Seatrade Maritime: Ramadan heralds reduced ship recycling volumes

Bangladesh has overtaken Pakistan in the subcontinent demo price league but activity will decline as workers fast until sunset across the subcontinent. 

The recycling market was expected to stay quiet last week as the combination of Chinese New Year and the start of the Holy Month of Ramadan was set to dampen demolition activity. But Bangladesh surprised the pundits, leapfrogging Pakistan to climb to the top of the league table. 

Although recycling yards in Pakistan’s Gadani are ahead on achieving Hong Kong accreditations, facilities in Chattogram are offering ‘some really strong numbers’ on attractive units, according to GMS, the world’s largest cash buyer of end-of-life ships in its weekly update. 

This is partly a result of positive sentiment following the successful election victory of the popular Bangladesh Nationalist Party, with a two-thirds majority. Other positives in Bangladesh include currency gains against the US dollar and a $16 jump in steel plate prices. 

Yards in Chattogram have focused on larger units, taking the second Capesize bulker of the year, delivered last week. Several other large bulkers were delivered too but the star of the show was an LNG carrier, close to 27,000 ldt, that remained idling offshore prior to delivery. More old LNGs are expected in the weeks ahead, as shipowners clear out old loss-making steamers that can’t hold their own in the market today. 

Buyers on the Alang waterfront in India continue to take a few sanctioned arrivals but are also buying a number of specialist vessels and geographically positioned units of various sizes and types, GMS said. Indian yards struggle to compete with Pakistan and Bangladesh breakers on large ldt vessels but its facilities can take specialist non-ferrous units and offshore vessels. Alang still has the most Hong Kong Convention yards of the  highest-standard and much more space. 

Latest indicative pricing from GMS sees Bangladesh in the lead, with $455 for containers, $445 for tankers, and $425 for bulk carriers. Pakistan is next, five dollars down across the board and Indian prices are a further ten dollars down. Indicative prices in Aliaga, Turkey, are $290, $280, and $270 respectively.