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Tankers and offshore units retain appeal for hungry recyclers

Photo: Leela Modernized ship recycling facility - Leela yard.png
Leela Ship Recycling yard
Strong demolition prices well into the $500 per ldt mark continue to prevail across the world’s principal recycling markets in India, Bangladesh and Pakistan.

For the moment, buyers are focusing on tankers and various offshore-related assets, where markets remain in the doldrums.

Recent budgets across the Indian subcontinent have left recycling facilities unaffected by any new duties or taxes, according to the most recent market report from GMS. The world’s largest cash buyer of end-of-life ships said that this had left the sector “positively positioned moving into the summer / monsoon months”.

Price levels look set to stay strong for the foreseeable future. Steel plate are prices relatively firm across the board and there is continuing healthy demand for tonnage that becomes available. A small decline in Turkish steel imports was reported this week, GMS said, but price levels and demand remain firm, nonetheless. 

For the moment, the focus is on tankers and offshore tonnage. Owners of container ships and bulk carriers are holding on to older vessels as volatile charter markets hit new peaks. Clarkson Research’s containership index rose to an all-time high last week while the Baltic Dry Index closed the week at 3218, up by almost 33% in the space of eight trading days.

Indicative demo prices from GMS show Pakistan ahead of its competitors, with container ships typically fetching $570 per light displacement ton (ldt), with ten dollars less for tankers and a further ten for bulk carriers.

Next comes Bangladesh with indicative prices ten dollars less across the board; then India, a further ten dollars behind. Typical prices prevailing in Turkey are $300 for container tonnage, $290 for tankers and $280 for bulkers, GMS said.

 

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