GMS: Volatile tariffs shape volatile markets

Global stock markets declined nearly 20% and lost over USD 11.2 trillion, only to appreciate by about 10% in the days following the announcement of a 90-day suspension on all tariffs to nearly all countries worldwide. While most of the world watched in silence, the EU and China responded in kind, placing counter-tariffs against the United States. This resulted in stock markets continuing their decline, despite President Trump reversing course mid-week. His tit-for-tat act with China shows no signs of abating, as China has placed about 125% in duties so far, while the United States has levied counter-tariffs totaling 145%.

Reportedly, Trump’s tariff backtracks erupted following a massive sell-off of U.S. Treasury Bonds—the gold standard of currency for the U.S. Federal Government—from the Japanese market. This caused Team Trump to panic, resulting in the administration’s erratic actions throughout the week.

For the sub-continent ship recycling markets, the key driver will be how hard steel prices and non-ferrous steel trade are hit when it comes time for ship recyclers to sell their product.

Although the 90-day suspension has given recyclers some reprieve for now, the deadline realistically stands just a quarter away. In the interim, oil has volleyed like a beach ball in the wind—declining to USD 56/barrel mid-week (the lowest level since 2020), before climbing back up to USD 61.50/barrel by week’s end. Future declines are still expected as OPEC+ countries reaffirm their decision to increase output, despite ongoing trade wars raising global economic uncertainty and diminishing energy demand.

Even the U.S. Dollar spiked briefly against all ship recycling nation currencies before settling, surprisingly, with even the Lira making decent gains. Global trade markets also continued to dip into the tariff pool as freight rates cooled, though they evened out toward the end of the week and reported minor gains.

What comes of this dip in rates remains to be seen, as no fresh tonnage has made its way onto bidding tables of late. This has manifested visibly at the anchorages this week—India (technically) reports its first ‘empty’ report, while Pakistan impressively takes in the most tonnage in the sub-continent. Meanwhile, Turkey continues to idle in standby, waiting for the opportune moment to spring into action—assuming there’s any tonnage to feed into the markets at this time.

Finally, for facilities (especially those with incoming deliveries over the next tides) that are due to initiate yard upgrades to HKC standards in Bangladesh but have not yet done so, a possible extension from the March 31st deadline is expected to come through next week. This is pending the nation’s return from the longest Eid Holiday on record and the Ministry of Industries’ handover of the requisite file to the newly formed Ship Recycling Board to coordinate the extension.

With the HKC deadline expected on June 26 this year and the Trump regime likely to revisit tariffs shortly thereafter, 2024 may prove to have been a ripple in a pool that’s now draining rapidly into the rapids of 2025—especially if long-term tariffs come into effect or, worse, if a larger-than-expected number of ship recyclers fail to meet HKC standards and are forced to shut down.

For Week 15 of 2025, GMS Market Rankings / vessel indications are as below: