Nearly 2 weeks have passed since the announcement was made that the Bangladeshi market would reopen, and yet the official court order has yet to be signed by the judge. That has left many end buyers understandably nervous as it is still unclear exactly what new guidelines are to be put in place for those 60 approved yards.
Consequently the buying has slowed, and the much anticipated binge on units has yet to fully materialize despite some firm initial numbers coming from Chittagong.
Indeed, early signs indicated that cash buyers had expected to peg prices at region USD 500*510/LT LD for bulkers and USD 530-540/LT LDT on tankers. This was some 20 USD from reality though with decent bulkers at USD 490 and tankers some USD 25 higher. At least for much of the cash buyer as is inventory, these were the levels being talked about the vast majority of buyers were unwilling to commit on tonnage without first seeing the details of the order and exact requirements placed in front of them by the judge.
The current state of uncertainty filtered through to some of the initial deals done at high levels, with one particularly high profile and high priced 28,000 LDT bulker failing into Bangladesh at USD 518/LT LDT.
Fundamentals in both India and Pakistan remain steady though as demand and prices showed signs of improving given the imminent threat of Bangladesh opening and absorbing most of the tonnage. China meanwhile continued to snap up their share of market tonnage usually geographically positioned vessels from Chinese owners nervous of delivering to the Indian sub continent even though the prices remained weaker due to most yards having reached capacity recently.
Source: Steel Guru. 22 March 2011http://www.steelguru.com/international_news/GMS_weekly_report_on_ship_breaking_industry_for_WEEK_11/196785.html
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