The uncertainty surrounding the viability of the Bangladeshi market as a competitive demo destination, showed few signs of abating this week. Almost all the local buyers displayed hesitancy and a reticence in offering, a sentiment that has characterized the performance of the last couple of weeks.
This may be understandable given that the potential 5% import tax continues to loom over local ship recyclers - something that could well see prices fall by a further USD 25/LT LDT (once imposed).
As a result very few end buyers were interested in offering on new units, tmless at mild numbers, well below the market.
As the BSBA squabbles with the government to resolve the issue (and lower the import tax rate), very few deals are being done to end buyers and NO vessels have yet beached despite the market officially being open for business once again.
Furthermore, with banks reluctant to loan money for fresh purchases and credit facilities stretched to the limit, there is no doubt that it will be a challenging few months ahead for the Chittagong
One optimistic cash buyer was willing to take a chance on the Bangladeshi market as they committed the BLT Kherson built tanker ANGRAINNI (10,830 LDT) for USD 510/LT LDT (at the same time as sending two suezmax tankers from the same owners to Pakistan).
Source: Steel Guru (Sourced from GMS Weekly). 24 January 2011
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