06 August 2013

GMS weekly report on Pakistan ship breaking industry for WEEK 31 0f 2013:

The Pakistan market has so far managed to elude the ongoing saga of the Iranian linked VLCCs, with existing international sanctions and banking restrictions keeping them from bidding on the 8 units set to hit the market.

As a result, all of the vessels have had to be cleaned to gas free for hot works standard, in order to qualify for entry into India or Bangladesh. Meanwhile, as the Ramadan period continues in Pakistan and demand and new deals remain at a premium, it may not be until after Eid that we see any aggression to bid on new or existing units in the market.

However, this will of course depend on international sentiments and pricing, with Pakistan unlikely to lead from the front when bidding. Despite a currency depreciation of up to 2% over the last month, Pakistan fundamentals remain perhaps the best placed of all sub continent markets currently.

A lack of favored vessels has yet to be presented to buyers and with prices across all sub continent markets very similar any larger units coming from the Far East are now more likely to end up in Bangladesh (or perhaps even Chinese) hands.

Two Titan managed VLCCs, the TITAN RUCHIRA (32,240 LDT) and TITAN TULSHYAN (39,042 LDT) have recently arrived and beached for around USD 420/LT LDT in the most eve catching deals of recent weeks. Along with capesize bulkers and VLOCs, these are the units of choice for Gadani buyers.

Source: Steel Guru. 6 August 2013

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