After many long hard weeks of subsequent falls, chinks of light started to appear in the Indian recycling industry this week, to give shattered end buyer confidence something of a boost.
Crashing prices for ships have resulted in cash buyers and end buyers losing millions on the back of frivolous renegotiations and ensuing problems at the time of physical delivery of prospective units.
It was after weeks of a gradually (and painfully) declining Indian Rupee (against the US Dollar) hitting an all time low, which resulted in the Indian Government finally intervening to relieve the beleaguered currency that had seen as much as 20 per cent of its value lost over the past six months.
The scope of the Governments intended changes has yet to be announced, but its immediate impact has seen the Rupee gain some ground against the Dollar and confidence too started to pick up. Coupled with the Euro bailout resolution for EU banks, many are speculating that the bottom has likely been readied - in terms of levels - and it may once again be a good time to buy.
As a result, increasing enquiries were forthcoming and more end buyers started to discuss numbers for units on offer.
But, as India continues trading at similar numbers to China (and still as the lowest placed Indian sub continent market despite stiff competition from Pakistan), it was difficult to commit any units locally, especially with many owners and cash buyers still understandably nervous about delivering vessels there.
Source: Steel Guru. 5 July 2012http://www.steelguru.com/indian_news/GMS_report_on_India_ship_breaking_industry_for_WEEK_26_2012/271845.html