After a bumper week of (speculative) sales last week around, it was a rather quieter week in terms of new deals, as demand and prices continued to heat up across the sub continent markets.
India has seen its currency stabilize of late something that has led to far more end buyers keen to return to the bidding table to acquire tonnage once again. Local steel plate prices remain volatile as ever and cash buyers will have to decide whether to offload their inventory if (they feel) the market has peaked, or hold for a little while longer in the hope of further gains.
Pakistani end buyers began to realize that their prices would have to improve if they were improve despite to stand any chance of competing with their Indian and Bangladeshi competitors. Numbers Rupee alarms. have indeed improved accordingly and several units have been sold locally despite, at least two cash buyer VLCCs remaining unsold at present.
The major concern for the week surrounded the failings of the Pakistan Rupee. For some time the currency had been stranded at a less than impressive 107 to the US Dollar before this week, alarmingly depreciating to PKR 108 and finally PKR 109 to the USD. A certain sense of panic is beginning to take hold in Pakistan and it may be that we see numbers tail off in the coming weeks, unless the local government can intervene, to stabilize the currency (as was the case in India).
Meantime, elections have been announced in Bangladesh for January 5 th of 2014, as a result of which, a select group of end buyers has been gambling on the fact that the continued political instability, strikes, and blockades, might contribute to a rise in steel prices and are stockpiling their yards accordingly.
Finally, China continued to underwhelm for another week, despite the seemingly constant flow of tonnage from local owners to yards, as part of the government incentive to keep shipbuilding and ship recycling active.
Source: steel guru. 3 December 2013