India is grappling with COVID-19 crises with close to 400,000 cases registered daily, which is the highest in any country during this pandemic.
Yards in Alang are shut as industrial oxygen supplies are being diverted to hospitals. While global steel prices continue to rally and are expected to trend northwards as China has cancelled export rebate and waived off import tariffs on steel. Higher steel prices are likely to support ship scrap prices in the coming days.
Recyclers from Bangladesh and Pakistan raised bids to secure tonnages amid tight supply, despite a sharp rise in COVID-19 infections.
Turkey has also imposed a lockdown until May 17, with over 38,000 new cases reported daily. But scrap and steel trade in Turkey has remained unaffected by the move, thus far.
The absence of oxygen has created havoc in Alang. Most yards are shut. Also, high infection rates among market participants and workers have impacted the scrap trade. Local steel demand has slowed with a reduction in auto production. Many auto plants are either shut or under maintenance.
Shipowners are avoiding ship deliveries to Indian to ensure the safety of their crew. However, Indian buyers are bidding at around $500/ldt for HKC compliant vessels. No major deals reported this week.
Pakistani buyers are competing with Bangladeshi recyclers amid firm domestic demand. Offers are above $500/ldt. However, Bangladeshis are offering higher prices for large vessels, especially for those arriving from the Far East destinations. COVID-19 infections are also rising rapidly in Pakistan with major hospitals operating at full occupancy. The country may soon witness an acute shortage of oxygen.
Domestic steel prices rose in Bangladesh encouraging recyclers to buy vessels above $500/ldt. Several deals were reported this week.
An FSU EM Vitality with 48,100/ldt sold at $500/ldt, while a tanker Freemont with 16,237/ldt sold at $535/ldt. The ongoing lockdown has been extended until May 5 to control the spread of COVID-19.
The Turkish currency lira and steel imports saw marginal gains this week as a result vessel prices remained unchanged. The Turkish government has imposed a lockdown until May 17. The arrival of vessels could be delayed due to the lockdown as most regions are closed.