Prices for older tonnage on the rise, with several owners considering decommissioning

The prices offered by scrapyards for older tonnage are reaching new highs with several owners considering decommissioning the older ships in their fleet.

Shipbroker Clarkson Platou Hellas said in its weekly report that various challenges facing India were having an impact. The report makes reference to there being no real appetite from end recyclers at the moment due to the after-effects of the Eid festivities.

Cyclone Tauktae also recently hit the country and it is in the midst of a strong third outbreak of COVID-19.

All of these things have “dramatically halted the dismantling procedures at the yards and may take a few weeks before they are back up and running at full steam, although despite the restrictions in place, vessels are still being allowed to beach and the country is open for recycling deliveries.”

Cash buyers are struggling to navigate in this market with recycling candidates either being offshore units in difficult delivery positions or large LDT vessels that not all buyers have the capabilities to finance, leaving some on the sideliners from what little tonnage is being concluded.

A recent drop in steel prices in the country could also push scrap prices lower as well, something that could curb interest amongst owners of vintage units.

For more information visit www.clarksons.com

1st June 2021