The Indian market has been reeling for the best part of two weeks, due to the sudden depreciation of the Indian Rupee, coupled with some dramatic falls on the scrap steel prices. Consequently, there is little doubt that a new reality on price, at least USD 20 per LT LDT off the peaks of the past few months, is just around the corner.
Part of the problem has been this import of cheap Chinese steel that has seen many yards undercut on their own inventory. As a result, there has been a complete reversal in the bullish sentiment that had characterized the third quarter and the early part of this year.
A cagey atmosphere has begun to prevail at the waterfront, with renegotiations and needless questions raised on incoming vessels, now becoming a regular occurrence.
Those cash buyers who rely on end user finance can only transfer their issues to the owners, whilst it is the role of the strong cash buyer who can fight frivolous claims and still get vessels smoothly delivered, despite market turmoil.
Whilst there were few market sales to speak of, those cash buyers who have agreed deals to India and have high priced unsold vessels in hand are desperately seeking alternatives to what is the worst placed of all sub continent markets at present.
Source: steel guru. 21 October 2014