23 August 2011

GDSA Weekly Demolition Market Report for WEEK 33 of 2011:

Week Ending: 19th August 2011 (Week 33, Report No: 33/11)

The week closed with sharp falls of activity in the secondhand, newbuilding and demolition market, while it is considered to be one of the most silent weeks since the beginning of the year. Newbuilding investments are still under second thought in the traditionally bulk carrier and tanker segment on the back of ample available list of tonnage. 

Overall, the newbuilding business is up by 42% in comparison with the buying momentum in the secondhand market, while the demolition activity is at similar levels with the volume of S&P activity. The week closed with 14 transactions reported worldwide in the secondhand and demolition market, posting a 56% decline from a similar week in 2010 when 32 transactions had been reported and secondhand ship purchasing activity was standing 21% lower than the ordering business. The highest activity has been recorded once more in the newbuilding market with 12 fresh orders reported worldwide.

Demolition Market:

Bangladesh’s market operation extension has not influenced yet the shipbreaking activity in terms of volume of transactions and scrap prices.

India showing signs of softness as the levels have started to fall below $500/ldt after the high levels seen before few days.

The Ramadan month in Pakistan and Bangladesh is underway and the activity is still subdued by the scrap buyers who may wait to see further falls in scrap prices.

In the meantime, Bangladeshi ship recyclers have officially received the certified copy of the court order that allows them to import vessels until October 12th.

Total sale:
The week ended with 7 vessels reported to have been headed to the scrap yards of total deadweight 194,364 tons.

In terms of the reported number of transactions, the demolition activity has been marked with 37% decline from previous week’s activity, while there has been a 71% decrease of the total deadweight sent for scrap.

Highest scrap rate offered:
In terms of scrap rates, this week the market witnessed a demo deal secured by Chittagong scrap buyers, the 1st since the official extension of the market, for a bulk carrier of 89,618 dwt with 17,195 ldt beached for $465/ldt, including 300 tons bunkers remaining on board.

Market leader:
India still attracts the lion share of the activity as it holds 57% of this week’s total demolition activity, while also some activity has been recorded also in China in the dry sector at region mid $450/ldt.

Same week in 2010:
At a similar week in 2010, demolition activity was standing at same levels, in terms of the reported number of transactions, 13 vessels had been reported for scrap of total deadweight 166,450 tons with no activity in the bulk carriers segment and tankers with liners holding 85% of the total activity. Pakistan was in the forefront by offering $395/ldt for dry/general cargo and $435/ldt for wet cargo.

Source: Golden Destiny SA. 19 August 2011 

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