The Safety4Sea editorial team reports that a new analysis from GMS reveals deep stress in the global ship recycling industry. Declines in oil prices, freight rates, and steel plate values — alongside currency devaluation and sanctions — are creating a perfect storm for ship-breaking yards.
Macro Pressures Weigh on Recycling
GMS highlights that oil prices have slipped significantly, trading near USD 57.68 per barrel, which marks a drop of over 6% in a month. At the same time, freight rates have collapsed, recording a nearly 9% decline in 30 days, and are 48% lower than November 2024.
Sanctions are also squeezing the market. The U.S. continues to black-list vessels, and some EU members are discussing stronger flag-state cooperation to curb evasive shipping practices.
Impact on Key Recycling Hubs
These macro shocks are rippling into major recycling markets: GMS notes a drop in deliveries to yards in South Asia, including both supply constraints and lower steel-plate prices in Bangladesh and Pakistan. Local currencies—especially in India—are also under pressure, which further compresses margins.
Regulatory and Certification Dynamics
Amid this turmoil, there’s some movement on environmental compliance: the first Pakistani recycling yard is reportedly gearing up for approval under the Hong Kong Convention (HKC) soon. In Bangladesh, nearly 20 yards are said to be on the path to certification.
Market Rankings from GMS
GMS provided its latest market rankings for ship recycling (Week 47, 2025), showing how different recycling locations are responding to current global pressures.
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Source: Safety4Sea
