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GMS Market Commentary on Shipbreaking in India in Week 15 - OFTEN UNCERTAIN!

Steel News - Published on Wed, 17 Apr 2019

Image Source: EJAtlas
India continues to quietly go about its business, securing a healthy share of HK SoC green recycling vessels, along with the difficult to beach / cut offshore units (rigs, drill ships, offshore barges, etc.). However, there was one market sale this week, which seemed to catch everybody by surprise and perhaps belie just how firm the market actually may be, despite end Buyer hesitations. The OEL container vessel OEL TRANSWORLD (16,160 LDT) managed to fetch a remarkable USD 480/LT LDT, perhaps for one specific hot and aggressive end Buyer in mind. The younger age (2000 built), decent size of 16K LDT (drawing in many end users) and heavy propellor of about 60 Tons seem to have contributed to the excellent price on show.

The comparatively smaller under-tow PAX vessel AKBAR (4,966 LDT) fetched a surprisingly firm USD 382/LT LDT basis an India delivery option (even though a Pakistan option is open, which it will likely not exercise as Gadani Recyclers generally do not prefer this type) with extra payment for bunkers and a 6% GST being applicable. Given that passenger vessels are discounted due to their heavier drafts, permanent ballast, and unfavorable beachings, it will certainly be interesting to see how this relatively small LDT undertow vessel will ultimately turn out for the Cash Buyer.

Smaller LPG BAROUDA (3,422 LDT) also fetched a sharp USD 360/LT LDT basis an ‘as is’ Algeria delivery. This level is certainly a surprise given that the weight of the Stainless Steel tanks is unknown and no guaranteed minimum bunkers included in the sale. Finally, reefer BALTIC PRINCE (6,023 LDT) managed to snag an equally impressive level, reportedly around USD 430/LT LDT.

These sales comes at a time when the ever-volatile local steel plate prices declined by about USD 5/Ton this week, whilst the INR continues to trade in the Rs. 69.7X against the U.S. Dollar. With the Indian elections just around the corner, until the election results are settled, it may be difficult to see a predicatble pattern / consistency on pricing in the Alang market.

AKBARPassenger Vessel4966USD 382/LT LDT
BAROUDALPG3422USD 360/LT LDT ('as is' Algeria)

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Posted By : Rabi Wangkhem on Wed, 17 Apr 2019
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