10 January 2012

GMS weekly report on Shipbreaking industry for week 01 of 2012:

The first week of 2012 bought some interesting developments for the global ship recycling scene as a number of cash buyers started offering once again basis Bangladesh delivery, despite the court hearing for the opening coming next on January 12th 2012.

Indeed several deals were concluded by a handful of buyers seemingly certain of a market reopening. These may be considered risky moves given the often precarious state of the market there. With China starting to cool down and India still in a state of paralysis with the ongoing currency crisis, it would perhaps be perfect timing if the Chittagong market were to return to the fold once again.

The news on levels though emanating from local buyers is not overly encouraging mid 400s on dry and high 400s/LT LDT on wet, generally echoing the sentiments from both, West Coast India and Pakistan at the moment.

In reality, given that yards have been deprived of tonnage for the past three months at least, prices will be expected to push on once news of an official reopening is made. Whether that occurs on or after January 12th 2012 is still a matter of debate as even the simplest of procedures often take weeks in the making in Bangladesh.

As Chinese New Year approaches, the recent buying spree in China looks to have reached its conclusion with many yards now full and demand exhausted. It Bangladesh is to come back once the holidays are over, it will be interesting to see how the Chinese market reacts to having their geographically closest rival as competition once again.

For week 1 of 2012, GMS demo rankings for the week are as below:

Market Sentiment
Gen Cargo Prices
Tanker Prices
USD 455/lt ldt
USD 485/lt ldt
USD 450/lt ldt
USD 480/lt ldt
USD 420/lt ldt
USD 440/lt ldt

Source: Steel Guru (Sourced from GMS Weekly). 10 January 2012

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