It is becoming more
and more difficult to predict the manner in which shipbreaking markets will
behave.
At a time when
caution could have been expected to be the watchword, there was rampant buying
at rates that can only be considered unsustainable.
In India,
uncertainty over the direction of the general elections, a steady slide in
prices of steelplate, to the extent of $10-15 per ldt during the month of
April, and the imminent start of the monsoon season were factors that should
have adversely affected buying, but did not.
In Pakistan and
Bangladesh, there would have been worry over the possibility of unfavourable
policies being introduced in the national budgets, scheduled to be announced in
the first week of June.
Ship recyclers were
razor-keen to stock their yards with pre-budget vessels, particularly after the
market was abuzz with news that a number of VLCCs were being earmarked for the
ship cemeteries.
Pakistani operators
tried putting their hands into this segment, but with their counterparts from
Chittagong with deeper pockets being vigilant in keeping their fingers on the
market pulse, the Gadani breakers had to be content with a slew of aframax
tankers they have successfully negotiated in recent weeks.
“The overall –
pre-budget, elections and monsoon – buying ramped into overdrive, particularly
in India, as some truly speculative and bullish prices beset the market,”
remarked Dubai-based cash buyers GMS.
“There were even
whispers of one or two VLCCs being concluded on ‘as is Singapore’ basis at some
big numbers approaching $20m, with bunkers for the onward voyage, although
gas-free status at this moment remains unclear, so a Pakistan or Bangladesh
delivery is uncertain.”
Bullish Indian cash
buyers were bidding as high as $480 per ldt for clean tankers and $450 per ldt
for general cargo vessels, remaining at least $5 per ldt ahead of corresponding
offers from Bangladesh, and a minimum of $10 per ldt ahead of Pakistan in both
segments.
The pick of this
week’s sales was that of the Danaos controlled 23,366 ldt Mytilini for an
astounding $509 per ldt. It was the fourth vessel sold to Alang this year by
the Hamburg based shipowner.
Singapore’s Pacific
International Lines got rid of their 6,811 ldt container vessel Kota Wirawan
for a mind-boggling $513 per ldt. Market men felt that the decent age,
ownership and size of the ship had attracted many end- buyers, and was
responsible for the massive price.
The Polish
controlled 1991-built, 13,575 ldt Danish panamax bulk carrier Armia Krajowa
sold at an impressive $480 per ldt, with 280 tonnes of bunkers on board.
Italian owners
committed both their ro-ro sister ships (both 13,696 ldt) Jolly Verde and Jolly
Rosso on ‘as is Jebel Ali’ basis, for a very firm $500 per ldt en bloc, with
extra payment for bunkers.
Despite these
bumper sales in the last week of April, there is an overall concern locally
that the market has peaked in anticipation of the impending monsoon season and
the announcement of the election outcome.
It appears highly
unlikely that the current high levels can be sustained, as prices generally dip
during the monsoon due to unfavourable beaching tides, along with the seasonal
migration of workers away from yards and back to their home towns.
Source: sea trade
global. 2 May 2014
http://www.seatrade-global.com/news/asia/bumper-demolition-sales-despite-uncertainty.html
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