22 October 2013

GMS weekly report on ship breaking industry for WEEK 42 of 2013:

Another strong showing from die Indian market this week coupled with a lack of sales tipped the power balance from Buyers to Sellers as cash buyers began holding out for prices on the ground, seemingly unthinkable only a week or two ago.

As sales continued to rack up at increasingly speculative numbers and as end buyers refused to budge too far from their given levels on market tonnage initially, there had been some concerns over the wisdom of (seemingly) frittering money away just to secure a unit.

However, the stance from end buyers appears to have softened this week, as a lack of available market tonnage (due to improving freight rates) and increasingly steady local fundamentals encouraged those buyers to come forward to secure desired tonnage, paying above market levels just to get a unit on their plots.

The Indian Rupee spent much of the week trading around 61 (and just below) to the US Dollar, in added signs that the third quarter currency woes have finally been overcome. Indeed, end buyers have taken a lot of heart from these recent showings and have finally come back to the table to offer (seemingly aggressively) on new units having been rather hesitant onlv a month or so before.

Bangladesh and Pakistan were largely absent from the buying and offering this week (despite one high profile VLCC making its way for a prompt delivery to Gadani shores), and the added initiative that these two markets could bring to the proceedings upon conclusion of Eid holidays could pull some further interesting dynamics into play.

The China market had very little to shout about this week after another poor showing on price. For the most part Buyers are losing ground to sub-continent markets with cash buyers choosing to take reasonably sized units in the Far East 'as is' and bring across themselves.

For week 42 of 2013, GMS demo rankings for the week are as below:

Market Sentiment
CARGO Prices
USD 400/lt ldt
USD 430/lt ldt
USD 390/lt ldt
USD 420/lt ldt
USD 385/lt ldt
USD 415/lt ldt
USD 340/lt ldt
USD 350/lt ldt

Source: Steel Guru. 22 October 2013

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