Falling steel prices, a depreciating currency, capacity concerns and an impending monsoon season have all combined over the past few* weeks, to bring about a veritable sense of doom into the local Indian market.
Indeed, for the first week in quite some time, an absence of market sales was proof enough of a crisis that has shattered the confidence of cash buyers and end users alike.
Indeed, many deals concluded at high levels some time ago, are facing problems upon arrival at the shorefront. Payments and deliveries are being delayed and local recyclers are looking for any excuse with which to knock money off / renegotiate prices.
One high profile vessel - the converted suezmax to ore carrier ORIENTAL NICETY (ex EXXON VALDEZ) has been stuck outside for several weeks now with relevant permissions not vet in place for the vessel to clear inwards due to concerns regarding cleanliness / hazardous materials on board. Rumor has it, the end buyers of the vessel are trying to find a wav out of the deal themselves.
Meanwhile, many are beginning to speculate on whether the market has vet bottomed out with further calls for the government to step in to stabilize the battered currency. Certainly, a breather on new vessels arriving over the past few months has been welcome given the hectic nature of business there this year.
Source: Steel Guru. 22 May 2012http://www.steelguru.com/indian_news/GMS_weekly_report_on_Indian_ship_breaking_industry_for_WEEK_20_2012/264860.html