Scarce tonnage creates two-speed ship recycling market, says Wirana
A widening gap between ship recycling markets across the Indian subcontinent is showing that local yard appetite, financing conditions and available capacity are increasingly influencing vessel values independently of regional steel-price movements, according to Wirana Shipping. In Bangladesh, the shortage of recycling candidates and strong demand from yards are encouraging recyclers to bid above…
Wirana Shipping has highlighted the emergence of a two-speed ship recycling market in the Indian subcontinent, driven by varying local yard appetite, financing conditions, and available capacity. In Bangladesh, the scarcity of recycling candidates and strong demand from yards have led recyclers to bid above local steel-market fundamentals. Conversely, in Pakistan, weak domestic demand and ample imported ferrous material have resulted in reduced offers and a subsequent drop in local steel plate prices by USD 27/MT.
Rakesh Khetan, CEO of Wirana Shipping, emphasized that ship recycling is no longer a unified regional market. Bangladeshi recyclers are showing strong interest in limited dry bulk candidates, while Pakistani recyclers are facing pressure from weak steel demand and abundant imported materials. He further explained, "For shipowners, destination, timing, and local capacity are becoming as crucial as steel prices."
Indian recyclers have maintained relatively stable offers despite a decline in local steel plate prices by USD 18/MT and finished-steel prices falling between USD 10/MT and USD 14/MT during the festive season. This stability is attributed to their continued search for suitable vessels. LNG and tanker candidates were circulated, although their locations and price differences make Chittagong the most likely destination for sales.
Tighter liquidity in India is increasing borrowing costs, adding another factor for recyclers to consider. Wirana Shipping anticipates a slow recycling supply in the near term but expects steam-turbine LNG vessels and smaller dry bulk ships to become potential sources as charter-market conditions evolve. The disparities between Bangladesh, Pakistan, and India underscore the importance of considering factors beyond regional steel-price movements when evaluating end-of-life sales.
Yard demand, access to finance, available capacity, vessel location, and delivery costs can significantly impact the final outcome for shipowners.
Written by urgent.news from Hellenic Shipping News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
