The ship recycling market is seeking price stability at present with some experts describing the current status as puzzling and sluggish.
“The recycling market remains in what can only be described as very puzzling state, with brokers and cash buyers on the edge of their seats still waiting for the anticipated surge of new tonnage to kickstart the year,” Clarkson Research noted in its most recent weekly report, observing a large spread of prices being indicated by cash buyers, as no one really knows the true position of the market.
Clarkson predicted however that price levels are set to remain stable.
Allied Shipbroking, meanwhile, stated in its most recent weekly report that the recycling market remains “sluggish” yet prices remain firmly entrenched in $420+ territory per ldt.
“All-in-all, given the periodical softening in tanker’s rates, as well as, the current disappointing freight market of the dry bulk market, we may well expect a sort of gear up in activity the following weeks,” Allied stated, before concluding: “The interesting part though, will be as to how demo prices will react if we start to see a relative excess of tonnage being pushed towards this direction.”
For its part, GMS, the world’s largest cash buyer of ships for scrapping, headlined its latest weekly report, Seeking Stability! Like Allied, GMS is expecting the number of ships heading for scrap to pick up.
“With tanker rates dropping this week and dry bulk rates stuck in the doldrums, the supply of ships is potentially expected to pick up in the weeks / months ahead,” GMS stated. The company observed that cash buyers remain focused on offloading their expensive unsold units that were purchased towards the end of last year at ever decreasing levels.