The international ship recycling markets have witnessed another roller coaster week and year, however, the industry concluded 2016 on an overall stable to positive note, according to a report from GMS, a cash buyer of ships for recycling.
During the first quarter of 2016 the prices slid down from their mid-2014 peak above USD 500/LT LDT, down to the very low USD 200s/LDT, representing a drop of over 50% in asset values.
Just declines into the USD 100s/LDT were feared, the markets made a recovery to storm almost USD 100/LDT higher and rise above USD 300/LDT levels again.
The next three quarters saw varying degrees of ups and downs, according to GMS, “but the year ends on a comparatively positive note as steel prices have overall rebounded across the globe and currencies have stabilized after a tumultuous 2016.”
Following a number of price corrections since 2014, many yards suffered foreclosures and bankruptcies, however, this year has finally seen plots get back on their feet.
“It will therefore be interesting to see just how 2017 begins, but it does seem like the worst is over as the industry wraps up 2016 on an overall stable to positive note, with scope for further optimism and improved performance in the year ahead,” GMS said.
The cash buyer added that, over the last couple of weeks, the markets remained relatively quiet and no market sales were noted in most major recycling destinations in the final week of December 2016.