.svg)
The recycling market is showing further signs of improvement in prices being offered by the end buyers strongly backed by the acute scarcity of tonnage. Stable freight rates across all segments are giving a boost to the owners to continue trading of ageing assets and the old tanker units which consisted of majority of tonnage in 2021 are now exchanging hands in the second-hand market instead of being retired for recycling.
Oil prices hit seven-year high this week as WTI nearly touched USD 87 per barrel after a fire in a pipeline from Iraq to Turkey briefly stopped flows, increasing concerns about an already tight short-term supply outlook. The growing geopolitical tensions in the Middle East and rise in demand with easing of Omicron concerns have also jostled the rising prices.
Steel demand from China is likely to remain tepid due to the upcoming Chinese New Year holiday from January 31 to February 6, whereas the Winter Olympics will begin from February 4, thereby ensuring strict vigilance from the government over air quality.
Dry bulk freight market has been in correction mode this week mainly due to the increase in availability of vessels after Indonesian coal export ban and high rainfall in Brazil affecting mining operations of iron ore flow. The market is also witnessing downtrend due to limited trading activities in this period leading to Chinese New Year.
Domestic steel demand is witnessing an upward trend and a positive sentiment is prevailing across the region which can be seen from an increase of about USD 20/MT in prices being offered by the recyclers for available tonnage in the market.
The Steel Industry Association of India is requesting Government to include all Iron and steel products in the Remission of Duties and Taxes on Exported Products (RODTEP) scheme on priority basis in the Union Budget for 2022-23 to bring the industry at par with global competitors and boost export competitiveness of the downstream industries which use steel as input raw material.
.svg)
Market is gearing up with increased demand for ferrous scrap pushing the offer prices being quoted by the end buyers. Negotiations for the available tonnage are going on in full swing. The price levels are expected to remain stable as there are very few units available for recycling and the elevated cost of imported containerized scrap ensures high demand for ship scrap.
Mills have kept the offer prices unchanged this week as well, but the market participants are expecting the prices to climb soon as mills do not have sufficient inventory in hand whereas the domestic demand has increased as various government construction activities are at their peak due to the ongoing winter which is the ideal season for construction.
The scarcity of units available for demolition has initiated a competitive run among the end buyers to secure tonnage by placing higher bids thereby increasing the offer price from Gadani by about USD 10/MT despite subdued domestic demand at the moment.
Demand from northern region has slowed down due to heavy smog in the winter season leading to a drop in local steel prices.
The widening gap between import payments and export earnings is causing a surge in the current account deficit, weakening the balance of payments position, and consuming the foreign exchange reserves of Pakistan. PKR is currently trading at 176.24/USD.
One semi-submersible vessel and a ROPAX vessel have arrived in Aliaga this week.
Import scrap prices have increased by USD 5/MT this week and domestic steel scrap has also rebound with higher import costs.
The Central Bank kept its benchmark interest rate unchanged after the meeting on Thursday, pausing a cycle of rate cuts and launching an “open-ended” policy review after the inflation rate hit 36.1%. The currency is currently trading at TL 13.41/USD.
The authorities have warned of a possible cut in energy supplies for factories after neighbouring Iran suspended natural-gas flows for 10 days citing technical failure.
LEADING CASH BUYER OF SHIPS AND
ENERGY ASSETS WORLDWIDE