The global ship recycling market is facing challenges due to rising costs, increasing steel prices, and energy shortages. According to Wirana Shipping’s latest report, Bangladesh and Pakistan are currently offering better prices for recycling candidates than India. While steel and scrap indicators are improving, the disparity between market sentiment and actual prices is growing, leading to higher offers for shipowners despite a slower supply of recycling candidates.
In India, recyclers are still providing the lowest prices in the subcontinent, even as local steel prices rise. Energy shortages affecting steel mills have dampened local demand, creating additional pressure. Although there are signs of a potential improvement in LPG supply to steel sectors, the outcome for Alang will depend on evolving supply conditions.
Bangladesh and Pakistan show stronger pricing signals, with recyclers in a competitive position despite cautious sentiments among steel mills. Rakesh Khetan, CEO of Wirana Shipping, noted that while India has the necessary infrastructure, the pricing gap is prompting shipowners to seek alternatives. The geopolitical landscape, including currency fluctuations and energy pressures, is also impacting demolition values.
As the second quarter begins, the ship recycling market presents more options on paper but is increasingly complex in practice. The coming weeks will be crucial in determining if India can regain pricing momentum and whether activity in Bangladesh and Pakistan will sustain its recent strength.
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