As the rupee reached an all vear LOW for the year at INR 56.63 to the US Dollar, there were very real and genuine fears that we may even see a HISTORICAL low of INR 57 (and probably in excess) prompting sheer panic in the market.
As vessels are purchased on a USD per long ton basis from cash buyers and resold locally in Rupees per ton, the value of inventories in India has plummeted significantly over the course of one week as ships continue to become more expensive leaving many end buyers simply unwilling to offer on any new tonnage entering the market.
Of course, this is causing major problems for cash buyers with vessels purchased and sold at the huge numbers earlier this month. Furthermore, there are those with vessels yet to be sold and who may hold off until some sort of recovery is seen.
One vessel that was reported to be sold was the Hapag Llovd container VERACRUZ EXPRESS (16,809 LDT) for a firm LJSD 428/LT LDT 'as is' Fujairah with sufficient fuel for the voyage over to the Indian sub-continent.
Whilst steel prices have remained volatile and unreliable for another week, there are hopes in the market that such a sharp shock to the system may prompt some more realistic buying with all end buyers losing money on vessels purchased this year. A logical adjustment in prices is therefore expected in the coming months.
Source: steel guru. 4 June 2013http://www.steelguru.com/news/index/MzE0MTQw/GMS_weekly_report_on_Indian_ship_breaking_industry_for_WEEK_22%250D%250A.html