Indian subcontinent’s shipbreaking tonnages in 2020 rose to 4.69mn ldt, up by 16pc from a year ago with Bangladesh leading the pack, despite a 23pc drop in volumes bought by Chittagong-based ship recycler, according to GMS. Shipbreaking activities continued in the subcontinental despite the disruption caused by the COVID-19 pandemic.
Shipbreaking activities were briefly halted slowed due to COVID-19 restrictions in March and April, while it remained slow when the lockdowns were eased amid a shortage of skilled workers and industrial oxygen. Post lockdown, higher iron ore prices and robust steel demand encouraged ship recyclers to increase vessel bookings.
Shiprecyclers in Alang brought 29pc more tonnage at 1.861mn ldt in 2020 compared to 2019 amid robust demand from re-rolling mills, while yards in Gadani returned to the shipbreaking market with a bang, competing fiercely with Indian and Bangladesh buyers to secure larger vessels with more tonnage.
Much of the 23pc reduction in tonnages reaching Chittagong can be attributed to the higher bids placed by Pakistani buyer, which made Gadani the preferred destination in the second half of the year. Also, a cartel of ship recyclers in Bangladesh, which was active for two months (Sep-Nov), stopped buyers from raising bids despite firm offers. Lower steel demand and subdued steel prices also kept buyers from booking more tonnages.
|Indian subcontinental shipbreaking tonnage in 2020|
|Tonnage (ldt)||2020||2019||Change %||Dec-20||Dec-19||Change %|
In December, ship recyclers actively booked tonnages amid higher ferrous scrap prices and stable steel prices in the subcontinental markets. After the dissolution of the cartel, Bangladeshi yards raised bids and restocked yards before the sellers head for New Year holidays.
A total of 194 ships headed to India’s Alang port in 2020, while 149 and 114 ships reached Bangladesh and Pakistan, respectively. Ship beaching at Alang was 7pc higher than the prior year, while 35pc lesser number of ships reached Chittagong, which beached 231 ships in 2019. In December, Alang port received 25 ships, up from 17 in 2019; Chittagong beached 18 ships, double from the prior year; while Gadani received 20 ships compared to 11 in 2019.