South Asia: Imported ship-breaking market faces tonnage shortage

The South Asian ship-breaking market last week, continued to experience a sluggish phase due to scarcity of available tonnage. Bangladesh's market is eagerly awaiting for the upcoming budget announcement on June 1, 2023 anticipating positive changes. Meanwhile, the Indian market lags behind its Bangladeshi counterpart with sluggish activity.

Pakistan's market continued to remain mute amid ongoing political turmoil and liquidity challenges. In Turkey, market prices remain unchanged for another week, with transactions also remaining low, as per GMS report.

Indian market remains flat

Last week, prices in the Indian market experienced a rise of $10/LDT for both container and tanker vessels. The Bangladeshi market maintained a relatively higher price level of around $65/LDT compared to India. In terms of trade activities, a significant number of vessels from far East Asia opted for delivery at Chattogram due to its comparatively lower delivery cost. Consequently, there has been an increase in vessel arrivals at Chattogram compared to India in recent times.

Vessel Arrival: Enam ( 6,891 LDT), a container and Novo 23 ( 1,885 LDT), fishing vessel had arrived at Alang port last week.

On the domestic front, the Indian Rupee (INR) stood at 82.76 against the dollar during the first half of today's trading, appreciating slightly w-o-w compared to INR 82.89 last week.

The total tonnage at Alang port last week was 54,147 LDT.

Bangladesh less active in terms of trade

The Bangladeshi market experienced a subdued period with a moderate increase of approximately $5/LDT in prices. Trade activities slowed down last week following a series of active tonnage supplies, primarily attributed to the onset of the monsoon, which typically spans from June to October. This period prompts many labourers to return home.

Buyers had resorted to alternative financing methods due to currency challenges helping to gain the much-needed tonnage in the last few weeks. Some potential buyers are choosing to wait until the budget announcement before submitting offers, considering the limited availability of units in the current market.

The Bangladeshi Taka appreciated to BDT 107.25 at the time of publishing this insight compared with BDT 108.27, last week.

The total tonnage reported last week at Chattogram port was 47,172 LDT.

Pakistan mute amid political, economical crises

The ship recycling sector in Pakistan endured another uneventful week, with no sales or activity observed, rendering it distant from the ship recycling markets in the sub-continent. Unlike their counterparts in Bangladesh that have been upgrading facilities to comply with HKC standards, no progress has been made in Pakistan, potentially causing the market to fall behind in the long term.

The country's ongoing political and economical crises has taken precedence, leaving the Gadani market to helplessly witness its neighbouring competitors attract units week after week. Meaningful sales in Gadani have been scarce for quite some time, with port reports and plots nearly empty.

The Pakistani currency appreciated to PKR 282.16 during morning trade today compared to PKR 286.95 last week.

The total tonnage reported at Gadani port last week was 2,200 LDT.

Prices in $/LDT

Source: SteelMint Research