The Middle East and global ship recycling markets are facing significant challenges, according to cash buyer GMS. Recent events, including security threats in the Middle East, the resignation of Bangladesh’s Prime Minister, and a decline in Indian steel prices, have created a volatile environment for the ship recycling industry. Other recycling yards in Asia are also reporting no new arrivals at its waterfront, highlighting the current struggles faced by the industry.
GMS emphasizes the need for a pause in order to restore stability to the ship recycling market. The recent decline in Indian steel prices has led to lower offers for ship recycling, with prices for dry bulk units falling below USD 500/LDT. The addition of four Hong Kong Convention compliant yards in Bangladesh has further complicated the situation, potentially diverting HKC units away from Indian yards.
Despite a positive budget in India, the ship recycling industry continues to face challenges, with Indian yards remaining dormant. GMS warns that the industry needs a break in order to regain confidence and offer competitive prices for fresh tonnage. The current state of ship recycling in 2024 is marked by uncertainty and a lack of stability, requiring a concerted effort to address the underlying issues affecting the market.
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