GMS Weekly Market Commentary – Week 37,2023

Credit : trust company

Market commentary

Food for thought! 

Bullish Buyers in both, the Indian and Pakistani markets, continue to push on for another week as they manage to secure some of the recently recorded, high-priced sales from both – the dry bulk and container sectors.

Some of the recent container sales (in particular) have caught the eyes of many in the industry, especially as levels gradually edge back up into the high USD 500s/LDT (approaching USD 600/LDT), thereby providing prospective Owners of vintage units, food for thought about the potential future of their aging beauties.

India certainly has been the chief driver behind much of the recent activity, as domestic steel plate prices once again posted decent gains of about USD 13/LDT towards the end of the week.

Moreover, following the conclusion of a successful G20 summit – in addition to a reported firming of international steel rates to the tune of about 2% – the overall business outlook across the country remains good – at least for the domestic Ship Recycling sector.

Pakistan is also not too far behind, with decent levels being displayed on available dry bulk units and even as L/C approvals once again start to gain some traction, especially after almost a year of being on the sidelines.

Bangladesh remains completely out of the buying, with levels down and L/C & bank approvals once again hard to come by. A decent number of well-priced Chinese-owned vessels have also been delivered and beached over the summer / monsoon months, but there seems little chance of any further deals being done below USD 500/LDT, as competing markets inch on higher.

Finally, Turkey seems to have entered into an over-extended holiday with virtually no activity being reported, and other than negative fundamentals (Lira and steel plate prices), the market has had virtually no movements being recorded for months on end.

Overall, the supply of tonnage remains decent going into sub-continent markets during Q4 of the year, with predominantly aging handy / Panamax sized dry bulk units & Feeder containers heading to the various recycling locations, in what will hopefully be a busy end to the year.



Following another week of minimal sales and activity accompanied by nonsensical local offerings being tabled on any available units on offer, Bangladesh has largely turned into a disappearing market, especially under the current circumstances.

Local Buyers remain convinced they can secure even geographically positioned vessels- below the USD 500/LDT mark, when that is clearly not the case, especially as vessels are being diverted to much stronger competing markets and at levels that are in the upper spectrum of what Chattogram Buyers are currently putting forward.

Realistically, fundamentals are certainly there to blame for the depreciating state of local affairs, especially as local steel plate prices have started flatlining once again, all while the Bangladeshi Taka continues to gradually approach a record BDT 110 against the U.S. Dollar, as it ended the week at levels just in excess of BDT 109.5X.

As such and unexpectedly, it has remained another quiet week on the sales front for the Chattogram market, especially as it stays rooted at the foot of the sub-continent rankings table and with little hope of a recovery any time soon, given how poor local fundamentals and L/C availability currently remains



India remains the best placed recycling destination for another week, with all of the recent show-stopping, high-priced fixtures heading towards Alang shores for redelivery –particularly, favoured container vessels that were committed into the high USD 500s/LDT.Indeed, it was a successful recent G20 summit in which, most of the world’s foremost leaders attended the forum and offered India, additional economic and political boosts for international trade in the coming years, as numerous business and infrastructure project discussions are reported to have taken place, some even reportedly headed for fruition.

Steel plate prices certainly seemed to be the chief beneficiary of these discussions (in addition to global steel prices that firmed about 2% in value during the week) causing domestic plates to gain about USD 13/LDT as the week ended, in addition to the Indian Rupee that is now back down towards the Rs. 83 mark against the U.S. Dollar, leaving the domestic recycling industry on a positive footing as it firmly enters Q4 of the year.


Able deputy! 

Pakistan remains an able and willing deputy to the leading Indian ship recycling market, as several recently concluded units have reportedly been able to head towards Gadani shores, especially as L/C restrictions & limits have seemingly eased of late.

Indeed, a majority of the recently concluded high-priced dry bulk fixtures seem destined towards a handful of Pakistani Buyers, who have managed to obtain their L/C / bank approvals in order to import vessels once again – and this has certainly not gone unnoticed.

Local port position has reported several, decent LDT vessels arrive Gadani’s waterfront since August, and we certainly hope this trend does not slowdown (or even come to a grinding halt) anytime soon.

Fundamentals too showed signs of recovery this week as the Pakistani Rupee reported a decent improvement from PKR 301 to mid PKR 296s against the U.S. Dollar (especially after recording over a year of economically merciless declines), while local steel plate prices remain suspended and unchanged once again.

Overall, it has been a long year for the Pakistani market as Gadani Recyclers watched on from the sidelines whilst competing markets in India and Bangladesh secured most of the tonnage. Notwithstanding, it is finally good to see a hungry and competitive Gadani market back in the saddle once again and hopefully load-balancing the tonnage distribution in the subcontinent markets.


Long holiday!

With the ongoing state of (ship-recycling) affairs in Turkey, there seems little this market can do to get more traction with tonnage anymore.Local steel plate prices remain weak & unchanged, as the Turkish Lira is once again on theverge of breaching TRY 27 against U.S. Dollar – as it ends the week at RY 26.97.

Given the current state of EUSRR regulations & a severe lack of available tonnage that is doing the most damage to the Turkey’s domestic ship recycling economy, coupled with local offerings that still leave much to be desired (especially in the face of a firming India / Pakistani market), it maybe that the variance in prices will likely give prospective Owners,pause in considering recycling levels into Turkey.

Did you subscribe to our daily newsletter?

It’s Free! Click here to Subscribe

Source : capital link