A Russian icebreaking anchor-handling tug supply (AHTS) ship has achieved a big premium to current elevated recycling prices.
Brokers have reported Femco’s very large, 16,800-bhp Kigoriak (built 1979) has been sold for scrap at $745 per ldt, or $3.6m.
This is well above cash buyers’ estimates of a top price of $610 per ldt for container ships heading to Bangladesh.
VesselsValue assessed the AHTS as being worth $2.87m for recycling.
Demolition broker Ed McIlvaney called the Canada-built ship an “interesting” case, explaining that the quality of equipment on board drove the price up.
The vessel also has strengthened steel content and four spare propeller blades of 1.8 tonnes each.
The ship will likely be delivered to an Indian sub-continent breaking yard.
Price forced up
McIlvaney said first offers of $640 per ldt received multiple acceptances, so the bidding rose to $680, which again drew a number of cash buyers, forcing the final deal up to its “massive” level of $745.
Femco has six other AHTS units. The company has been contacted for comment.
GMS — the world’s biggest cash buyer — said in general the scrap market is looking for tonnage.
“It has been an increasingly static week in the Indian subcontinent ship-recycling markets, especially after some early 2022 optimism displayed by a resurgent India in particular,” the company said.
Demand for scrap candidates is described as “ripe” in the region.
“There are still a few vessels needed in the market to satisfy the recent onset of demand, and subcontinent recyclers usually find themselves competing at above-market prices on any of the select units that do become available,” GMS said.
McIlvaney said the flow of vessels is slowing, making end receivers more desperate.
“The latest sales reported are generally not what is considered the mainstream type of vessel for sale, albeit most are achieving excellent levels courtesy of their quality equipment and high non-ferrous content,” he said.
