The reluctance of the European Union to approve high standard Indian yards in their list is causing limited capacity in the EU approved yards and hence forces the owners of large-sized vessels sailing under an EU flag, to wait longer for getting their vessels recycled. This of course is not the only problem as geographical restriction is also hindering competition in the market which cause losses to the shipowners. Due to low prices being offered by EU approved yards, many shipowners have laid up their vessels,whereas India can offer high prices for them leading to their timely recycling.Hopefully with the Covid restrictions coming to an end, EU will proceed with new approvals that will allow the European shipowners to achieve same prices as their worldwide competitors with the highest standards of ship recycling.
U.N. General Assembly adopted a resolution on Tuesday to ease travel of those people who are working on ships by urging all nations to designate the seafarers as “key workers”. Travel restrictions imposed by countries due to pandemic have created difficulties for crew changes, embarkation and disembarkation which resulted in stranding of almost 400,000 seafarers.
The US Navy is reviving its First Fleet and deploying it in the crossroads between the Indian and Pacific Ocean. This tactical formation is aimed at emphasizing the growing importance of the region and their strategic partnership with India. The move assumes significance due to China’s assertive actions across the Indo-Pacific, especially the South China Sea.
After days of intense discussions, OPEC+ has agreed to increase Oil production by 500,000 barrels per day from January 2021. This will bring the total production cut from 7.7 million bpd to 7.2 million bpd. Even with the optimism in market due to vaccine breakthroughs, the global oil demand remains depressed, which led to widespread expectations that OPEC+ will not be in favor of increasing production.
The prices being offered by end buyers from Bangladesh have shown a steep rise this week. To stay competitive, both India and Pakistan will have to level up to match their prices with those being offered by Bangladesh.
Current market conditions are quite conducive for Cash Buyers with good inventory of fleet as they can command better prices than before.
It is difficult for India to secure imported shredded steel due its inability to offer competitive prices in line with the prices being offered from Turkey, Pakistan, and Bangladesh. Traders are currently meeting their demand from domestic scrap available in the market.
India’s Supply chain is under major risk due to an intense stand-off between the Government and the farmers who are protesting against newly introduced Farm Bills. Farmers’ groups have brought major metropolitan cities like Kolkata and Mumbai to a standstill, with sit-ins organized on key transport routes. The All-India Motor Transport Congress (AIMTC), an umbrella body of truckers, transporters and passenger vehicle has warned that they would shut operations in north India from 8th December if the Central government did not repeal the three farm laws passed in September.
Union Health Ministry made an announcement today, stating that the Covid-19 vaccine will be first given to about one crore health workers including Doctors and nurses from both Public and Private sectors. Thereafter it will be given to about two crore frontline workers such as Police, Armed Forces personnel, and Municipal workers, among others. Prime Minister has assured the nation that India will produce the much awaited Covid-19 vaccine in next few weeks.
There has been a dramatic increase in the prices of Plates and HMS this week. We believe these price levels may continue for a couple of weeks more.
There is a strong demand for tonnage from recyclers. The dissolution of Cartel in the previous week has led to a sharp upward trend in prices being offered for vessels. This is supposedly a good time for Cash Buyers to make higher profits on their available fleet.
Price of imported scrap has shot up due to tightened supply from international market and soaring ocean freight costs. The traders are waiting for the prices to come down but are equally worried that they will soon have to return to the market and buy scrap at higher rates.
Government has announced free distribution of 30 million doses of Oxford-Astra Zeneca COVID-19 vaccine expected to be available for patients from January onwards. The distribution will be done in line with World Health Organization protocols that determine who will get the vaccine first. To ensure smooth financing, the government has already sent letters to donor agencies seeking loan assistance to buy the vaccine.
Price of Ship plates has gone up by USD 13/MT.
Markets are steady and moving up slowly. The price being received for vessels have seen an increasing trend in past two weeks. The high-level activity coming from Bangladesh market is significantly affecting the price levels in Pakistan.
Price of shredded steel has seen an upward trend but finished sale prices are not moving up in line with the increasing raw material prices. This is leading to a wait and watch situation for many traders who are waiting for an equal balance in market before making a purchase, while some traders are buying to meet their current inventory requirements.
The Government has announced that they will provide Covid-19 vaccine free of charge to all citizens of Pakistan when it becomes available in market.The frontline healthcare workers will be at the top of the vaccine priority list. In the second stage, the elderly and at risk-population will get the vaccine and then will come the general population. Government has allocated$150 million grant for the purchase of COVID-19 vaccine to ensure timely access and availability of doses after approval from Prime Minister Imran Khan.
Two small vessels have arrived at Aliaga this week.
Steel Prices have improved in the domestic market by about 5 USD/MT this week.
Turkish yards are running at full capacity, making it difficult for Shipowners to reserve space for their aging vessels.
Import scrap is about USD 10 higher compared to last week. This week has seen active importation of shredded steel.
USD to Turkish Lira is currently trading at 7.79. Government needs to maintain the momentum of economic reform to ensure the stabilization and strengthening of Lira.
Turkey has recorded more than 30,000 cases a day this week. The nation added weekday curfews and expanded weekend restrictions into lockdowns. Health Minister Fahrettin Koca announced on Tuesday that a Chinese vaccine would be delivered first to healthcare workers after 11th December and to millions more in the following months. The Chinese vaccine will be free for everyone, while those from other companies and countries might be sold at pharmacies.
(Source: Daily Sabah)