GMS: The world is in need of a serious break

This week, the world has seen increasing security bulletins surrounding an imminent Iranian/Hezbollah threat against Israel. The U.S. has repositioned two aircraft carrier/destroyer fleets off the Gulf of Oman and Eastern Mediterranean, leaving the entire region on high alert.

PM Sheikh Hasina abruptly resigned as Prime Minister of Bangladesh and fled to India in a government helicopter. Indian steel prices have nosedived, and all ship recycling nation currencies have devalued in unison against the U.S. dollar. Finally, the top ship recycling destination in the world, Pakistan, reported no fresh arrivals at its waterfront and has nothing to show for their firmer levels. This is the tragic reality of ship recycling in 2024.

It’s safe to say the world is in need of a serious break before a modicum of stability can return. This is important not only for global peace but also for ship recycling, so our industry has a chance to revive its confidence and offer meaningful levels on fresh tonnage once again. This need for stability is especially evident as India and Bangladesh surprisingly report noteworthy arrivals at their respective waterfronts this week.

Ever since the unexpected results of India’s recently concluded General Elections, local steel plate prices have collapsed by nearly USD 60/ton and reported further declines this week, leaving most Alang offers on dry bulk units firmly below USD 500/LDT and only slightly above USD 500/LDT on containers. Indeed, demand and pricing from Alang have been on an entirely new level of disappointment for over six weeks now, despite an overall positive (for the nation) budget that has done little to disperse India’s gloomy ship recycling clouds.

Making matters worse, with an additional four HKC-compliant yards now recognized in Bangladesh, any of the slim pickings of HKC units that may become available could also be diverted away from Alang, despite an increasing number of Indian yards lying dormant this summer and monsoon.

As such, despite tonnage offerings that remain abysmal, the resignation and departure of PM Hasina has seen jubilant scenes erupt across Bangladesh, in the face of recent violence and anger that became a staple through much of July. Now that the demands of the majority are being discussed and the domestically unpopular PM has abdicated her role, a greater degree of stability and eagerness to buy should be forthcoming from Chattogram, despite the ever-looming fears of a lack of U.S. dollars in the country that could affect Bangladesh once again.

Pakistan remains a dark horse; firm yet passively unaggressive in fully capturing the gravity of their position in today’s market, ostensively having the firmest prices on show even for units geographically suited for India. Turkey at the far end screams “reset” amidst its devastating silence and levels that finally fell USD 15/ton.

For week 32 of 2024, GMS demo rankings/pricing for the week are as below:

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