10 March 2013

GMS weekly report on shipbreaking industry for WEEK 9 of 2013:

It was a week of interesting activity on all fronts with budgets announced, new taxes implemented, and instability undermining fundamentals across the Indian sub-continent. China too faced challenges as local market fluctuations coupled with chronic oversupply left the previously bullish end buyers in a state of flux. There is much to discuss men, as industry plavers convene once again in Dubai for the annual Tradewinds recycling conference and the turbulent events of the year so far are likely to be a hot topic of debate.

Central to sentiment across the sub-continent is the largest recycling destination, India, where this week, the much-anticipated budget was announced. As tends to be the case, there were few overall material changes to affect the recycling industry and it remains business as usual there. This had seen some renewed optimism return to the buying before the currency once again took a turn for the worse and depreciated back towards Rs. 55 to the U.S. Dollar. As it remains, if it's not local steel plate prices causing suffering on the Indian shorefront, the currency is sure to play its role to the despair of local buyers!

It was in Pakistan however, where the biggest shock for the week came with news of a potential 5% tax hike on new vessels to be imported for recycling. This news has come about quite suddenly so Gadani buyers across the board have decided to put a halt on buying activities for the time being until the fine print has been read and all is fully understood regarding the potential new payments / taxes. Bangladesh has been rocked by riots, strikes, and unfortunate deaths after the announcement early in the week that an Islamist party leader was sentenced to death. The whole country has ground to a virtual standstill with police and rioters reportedly clashing.

China experienced some worrying signs of decline as many end buyers chose simply not to offer following the recent binge on units there and sentiment stuttered for the first time this year. Finallv, as Turkev continues its encouraging start to the year, a few more sales come to light as the MPP SAKALA (6,120 LDT) fetched region USD 304/LT LDT. Two approximately 7 KLDT RoRos were also sold on PNC terms into Turkey for region USD 325/LT LDT.

For week 09 of 2013, GMS demo rankings for the week are as below:

Market Sentiment
TANKER Prices 
USD 400/ltldt
USD 425/ltldt
USD 390/ltldt
USD 420/ltldt
USD 385/ltldt
USD 420/ltldt
USD 375/ltldt
USD 400/ltldt

Source: steelguru. 5 March 2013

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