GMS weekly report on Bangladesh ship breaking industry for WEEK 30 of 2014:

With Eid holidays concluding and government offices, banks, and end-buyers all back to work, it was expected that levels in Bangladesh would pick up once again. It has however, been a slow start so far without any marked improvement.

As such, few vessels are likely to end up in Bangladesh in the face of rampant interest from Pakistan (in particular) and comparatively more interest in India.

At present, prices are almost USD 20 per LT LDT from their sub-continent neighbors, and for such a difference in price, many owners would rather position their vessels to India Pakistan, something that could well see Bangladesh buyers continue to miss out on their share of market tonnage.

One small vessel was concluded for the week at what appears to be a speculative price, with the general cargo / tween unit SEA WORKER (1,991 LDT) fixed at USD 445 per LT LDT from Russian owners.

Source: steel guru. 5 August 2014

http://www.steelguru.com/indian_news/GMS_weekly_report_on_Bangladesh_ship_breaking_industry_for_WEEK_30/345817.html

GMS weekly report on Pakistan ship breaking industry for WEEK 30 of 2014:

A busy last few weeks continued in Pakistan with India underperforming again due to concerns over local steel plate prices and the currency hampering offers and activity there.

The VLCC SAMHO CROWN (42,515 LDT) had been committed (most likely under tow) last week for USD 490 perLT LDT, along with several handymax to Panamax sized bulkers in and around USD 475 to USD 480 per LT LDT.

That trend continued this week with the sale of the next Polsteam controlled panamax bulker LEGIONY POLSKIE (13,361 LDT) for a phenomenal USD 486 per LT LDT. The decent condition (owing to the Danish country of build) has contributed to the excellent price on show.

As the market of the moment, many will be hoping that Pakistan can continues this hot streak for the next few weeks, and many vessels with India Pakistan options are being positioned accordingly, in order to enjoy the premiums on offer there.

Source: steel guru. 5 August 2014
http://www.steelguru.com/international_news/GMS_weekly_report_on_Pakistan_ship_breaking_industry_for_WEEK_30/345884.html

GMS weekly report on Turkey ship breaking industry for WEEK 30 of 2014:

It was another slow week in Aliaga with Turkish breakers having most of the week off due to the Eid holidays.

Only a couple of small units were reportedly delivered locally and the supply for tonnage continues to remain low. At the same time, demand from end buyers continues to firm in the absence of available tonnage and subsequent local fixtures. As a result, current local activity is doing little to satisfy the needs of the local market.

In addition to the demand for tonnage, other factors, which are influencing the pricing for tonnage, include the currency and local steel prices, which remained on the positive side. Consequently, the market remained firm the last week of July, with a reported improvement of about USD 5 per lt.

Although August has traditionally been a quite month, it is yet expected to become busy post-Ramadan and it remains to be seen how Turkish buyers are going to react and what prices will be offered for the units offered for recycling in the coming weeks.

Source: steel guru. 5 August 2014

http://www.steelguru.com/international_news/GMS_weekly_report_on_Turkey_ship_breaking_industry_for_WEEK_30/345888.html

Carrier Constellation set to bid Bremerton farewell:

BREMERTON — One tugboat will tow the mammoth USS Constellation 16,000 miles from Bremerton to Texas.

The 140-foot seagoing tug Corbin Foss, though larger than its harbor cousins, is dwarfed by the 11,000-foot, 61,000-ton aircraft carrier. It’ll coax the old warship away from its home of 11 years, Puget Sound Naval Shipyard’s Inactive Ships Maintenance Facility, on Thursday and chug around the tip of South America to the Brownsville, Texas. There, at International Shipbreaking, the 54-year-old Connie will be scrapped.

The trip, at six knots, is expected to take more than four months and require six diesel fill-ups, said Drew Arenth, Foss Maritime’s manager of business development, planning and analysis. It’d be much quicker if the carrier could fit through the Panama Canal.

The Seattle-based company would like to get fuel delivered to the tug, but might have to leave the Constellation with assist boats while it goes ashore. The Corbin Foss’ eight-person crew will be switched out at Punta Arenas, Chile.

“I’m sure it will be very exciting,” Arenth said. “It’s a phenomenal job for Foss. It means a lot to our guys, anything that’s got the Navy involved. Everybody on the boat has an admiration for the sea and people at sea.”

In February, Foss brought the aircraft carrier USS Forrestal from Philadelphia to Brownsville to be dismantled by All Star Metals. That journey took just 16 days. A third carrier, the USS Sarasota, is awaiting a tow from Newport, R.I., to a third Brownsville dismantler, ESCO Marine, but is being delayed by peregrine falcons nesting onboard. The fledglings are expected to be ready to leave by mid-August.

Dismantling the Constellation will be the largest ship recycling job in United States history. It will take about two years and yield about 60,000 tons of materials, said Bob Berry, International Shipbreaking vice president.

The other two dismantling companies paid 1 cent for the ships and get the proceeds from the metal. Because of the long haul, the Navy is paying International Shipbreaking $3 million.

Now that recycling contracts have been awarded to each of the three companies, the Navy car award more contracts for scrapping non-nuclear-powered carriers over a five-year period with All Star, ESCO and International Shipbreaking competing for the work.

There are four left. The Kitty Hawk, Independence and Ranger in Bremerton, and the John F. Kennedy in Philadelphia. The Kitty Hawk is being kept in reserve and the John F. Kennedy is available for donation as a memorial or museum. The Independence and Ranger are designated for scrapping.

Source: kitsap sun. 2 August 2014

http://www.kitsapsun.com/news/local-news/what-a-long-slow-trip-itll-be_94425219

Shipbreaking industry shifted from Steel to Shipping Ministry:

The shipbreaking industry, so far under the Steel Ministry, has now come under the control of the Shipping Ministry. This will help the sector attract more ships to Indian yards, including the world’s largest — Alang in Gujarat — and get marketed well at international shipping forums, according to sources in the Shipping Ministry.

Logically, the shipbreaking industry should be with the Steel Ministry, as once the ship beaches there is no role for the Shipping Ministry. However, to bring in the ships, the role of the Shipping Ministry is vital in terms of regulations and sops, according to Nitin Kanakiya, Secretary, Ship Recycling Industries Association (India).

The industry provides direct employment to nearly 40,000 people and earns annual revenues of around ₹2,500 crore. However, it is not in a healthy state due to competition from neighbouring countries and ‘bad press’. “We need good visibility and the shipping fraternity can provide this at international forums,” Kanakiya told BusinessLine.

The first thing that the Shipping Ministry did was to constitute an inter-ministerial shipbreaking scrap committee. It notified it on July 22 to consider all issues related to the industry.

The ministry plans to seek the help of Japan International Cooperation Agency to upgrade the existing infrastructure at Alang. A plan will be prepared to modernise the Darukhana shipbreaking facility in Mumbai port, sources said.

This is one of the 15 major projects taken up under the ministry’s comprehensive action plan.

The ministry’s action plan follows Finance Minister Arun Jaitley’s announcement in the Budget rationalising the duty on shipbreaking scrap and melting scrap of iron or steel by reducing the basic Customs duty on ships imported for breaking, from 5 per cent to 2.5 per cent.

India’s ship-breakers have borne forex losses of over ₹1,000 crore in the past two fiscals. The Budget move to halve Customs duty to 2.5 per cent on scrap-vessel imports and a much more stable rupee in the current fiscal, ‘come as manna,’ said Crisil, an analytical company.

Collectively, they are likely to add over ₹100 crore or well over a percentage point to the industry’s operating profitability. The duty cut also puts shipbreakers on a par with their primary — and nearly three times bigger — competitor, the molten-scrap importers, who have enjoyed 2.5 per cent import duty for a long time.

The duty cut, however, is not expected to significantly increase business volumes for these secondary sources of steel. But for shipbreakers, profitability and competitiveness, which had eroded as a plunging rupee last fiscal helped Bangladeshi, Pakistani and Chinese rivals do better, will improve, said Crisil.

Price differential

Last fiscal also saw fewer scrap vessels being imported, at 298, or 24 per cent less than the 390 in fiscal 2013, as economic slowdown subdued domestic demand for steel. Also, the rupee’s 20 per cent fall meant the average scrap-purchase price differential between Indian and Bangladeshi bidders narrowed to just $10-15 per light displacement tonne (LDT — refers to the weight of a ship without load) in June 2014, and nearly level with the Pakistanis.

The duty cut translates into gross savings of about $15/LDT. Crisil believes this will help ship-breakers add to their bidding price, and help widen the differential versus rivals once again. And, if demand and the rupee stay stable, the number of scrap ships imported could rise to over 320 in the current fiscal, leading to greater activity in the yards of Alang. It will also be a positive for local employment, Crisil said.

Source: the hindu businessline. 3 August 2014

http://www.thehindubusinessline.com/industry-and-economy/logistics/shipbreaking-industry-shifted-from-steel-to-shipping-ministry/article6277505.ece