Since the Chinese have been exporting most of their steel, it was no surprise to see rates fall further to the low USD 200s per LT. These numbers are frankly unworkable for most international/market vessels and it is only the rather generous state subsidies that have helped local yards stay in business.
With the two largest ship owners in the world COSCO and China Shipping – scrapping vast numbers of their fleet this year in China (even some younger units, considered trading candidates due to the fantastic subsidies on offer), it has basically become a domestic ship recycling market in China.
It is during times of crisis like this that a competitive China market is needed to take some of the slack from the Indian sub-continent, so it is extremely frustrating to see such low rates prevalent there at present.
Source: steel guru. 19 November 2014