Indian ship recyclers are back in the buying game thanks to liner giants AP Moller-Maersk and MSC Mediterranean Shipping Company.
Ship recycling reports published by cash buyers and brokers over the weekend listed MSC as selling two container ships for recycling at Alang while Maersk sold one.
Although these deals specified strict HKC-compliant recycling, they came about as Indian recyclers were able to increase the price offerings above the $500 per ldt mark thanks to rising domestic steel plate prices.
MSC, which has been continuously pruning its fleet of older tonnage over the course of 2023, was reported to have sold the 3,720-teu MSC Erminia (built 1993) at $505 per ldt, or $8.9m.
The 1,850-teu MSC Lana II (built 1999) achieved a higher price of $520 per ldt, or $5.38m.
Brokers told TradeWinds that the price differential on the two MSC ships showed the increase in prices being offered out of Alang as steel plate improved by $10 per metric ton over the course of the week and recycling yards bid eagerly for tonnage in anticipation of further improvements.
Maersk, on the other hand, was reported to have obtained $405 per ldt, or $5m, for the 2,890-teu Maersk Patras (built 1998), which was sold on an as-is basis in the United Arab Emirates.
Industry sources said that Maersk sells its ships below the market price due to its very strict recycling protocols. Maersk deploys its own supervision teams at the small number of recycling facilities it is willing to work with.
These teams ensure that the Danish shipping giant’s own recycling plan is strictly adhered to. Recycling ships in the Maersk-stipulated manner is said to take several months longer than the average six months it takes to recycle a ship in an HKC-compliant manner, and therefore the yards offer lower prices to hedge their risks against steel plate price volatility.
Outside of Alang, Singapore’s Liberty Navigation elected to recycle its 1,730-teu SOL Straits (built 1997) in Bangladesh, where it was able to get a significantly higher $592 per ldt, or $4.6m for the ship.
Recyclers at Chattogram were also able to buy a Stam Shipping-controlled panamax bulker. The 74,800-dwt Alba I (built 2001) was sold for an undisclosed price.
