South Asia: Imported ship-breaking prices recover, market sluggish w-o-w

South Asia's ship-breaking market witnessed a slightly busier start to 2023 at most of the recycling destinations, the market had become quiet in terms of sales and activity as the Far East is off celebrating Chinese Lunar New Year holidays last week.

However, prices and the demand have begun to recover in Indian subcontinent markets (except Pakistan) and Turkey. L/Cs to import units remains a serious concern in the Pakistan and there is an increasing optimism (particularly in Bangladesh) that talks about an IMF loan may bring some much needed liquidity into the country, allowing end buyers to open L/Cs and import tonnage once more.

Indian buyers enjoy holidays

Following several sales at progressively firm levels over the last week, it had been an entirely quiet week in Alang due to various holidays, including India's 74th Republic Day and the Chinese New Year.

On the domestic front, the Indian Rupee has been trading at much more stable levels in the mid INR 81 range against the USD.

The total tonnage at Alang Port last week was 57,261 LDT.

Bangladesh market finding ways to sustain with L/C issues

Although sentiments and prices have improved in Bangladesh in recent weeks, only a small number of sales were noted in Chattogram due to persistent finance and / or LC issues.

Buyers are still attempting to open Usance L/Cs or obtain financial assistance rather than going through government banks, that are currently refusing to open any non-essential L/Cs.

As a consequence, for the moment, most of the tonnage proposed for sale has been focused on India, HKC green sales and also preferred containers, which are receiving the best deals of any market.

On the domestic fundamentals front, the Bangladeshi Taka appears to have stabilised around BDT 105 against the USD.

The total tonnage reported last week at Chattogram Port was 62,598 LDT.

Pakistan's recyclers struggling with financial crisis

Distressingly for Gadani Recyclers, offering the lowest (sub-continent) prices, combined with their current inability to open up L/Cs, has stranded the Pakistani market at the bottom of the sub-continent rankings, leaving local Buyers unable to import any new vessels.

The Pakistani Rupee has depreciated at an alarming rate (nearly) 9% in a single day, finishing the week at more than PKR 262 against the USD, a historic low for the PKR.

The total tonnage at Gadani Port last week was 23,001 LDT.

Prices in $/LDT
Source: SteelMint Research