In contrast to the markets of new building and second hand tonnage, where under the influence of low freight market conditions have had a pronounced downward trend, the market of ship scrap in 2012, was flourishing.
Like the freight market, shipbreaking for scrap also has its distinct repetitive cycles, the following, as a rule, collapses the freight market. So, in 1982 and 1986 volumes of dismantling of ships for scrap was $ 25.6-38,0 million dwt. In 1998 and 2003, during the next big surge, these volumes ranged from 25.0 to 30.5 million tons In 2009 and 2011, cutting -40,1 amounted to 25.7 million tons, and in 2012 it can reach almost 60 million dwt. Only 11 months to demolish the left 52.9 million dwt, which is a new record for ship breakers yards. In India alone, in November 2012 for scrap received 55 ships, which was not observed even once over the last thirty years. If you compare the November price level for cutting of bulk carriers in 2009 and 2012, currently they are about $80/LDT lower than a year ago, at $50/LDT lower than 2 years ago and at $60/LDT higher than in 2009 compared to 2011, the average deadweight of bulk carriers, pushed for scrapping in 2012, increased from 57 to 63 thousand tons, while average age decreased from 31 to 28.
The price trend for ship scrap in November 2012, moving as if in two opposite directions. On the one hand, there were lower prices for bulk scrap on the Indian subcontinent to $380/LDT (India) $385/LDT (Bangladesh), and with another upward trend to $360/LDT in China and $310/LDT to Turkey. As a result, the difference between the prices of ship breakers yards Indian subcontinent and China, not so long ago amounting to almost $100/LDT, now down to $20/LDT.
This year is a mirror image of 2008, when the ship breakers yard literally begged the owners to give them at least some the download, by scrapping the older vessels. Now the reverse is the case when the owners are in the queue to the ship breakers yards, trying to get rid of damaging tonnage. At the end of October to November 2012 came from the sale for scrap of the bulk carrier "Makeevka" and the universal dry-cargo ship "Yuri Twin", belonging to LLC "commercial Fleet of Donbass". The first ship went to a breaker in India for $3.3 million, and the second to Turkey for $960 thousand Naturally, the company sold these vessels are not from good life, and due to the fact that for the last time at the current level of freight rates the court has brought some losses. Unfortunately, a similar fate to dramatically improve the freight situation will have many ships. But, this is a positive, since shipbreaking for scrap improves the balance of demand and supply, helping the market's recovery.
Transport business