18 Aug 2026
The global ship recycling market entered Week 33 of 2026 with increasingly divergent conditions across the major recycling destinations, as geopolitical uncertainty surrounding the Strait of Hormuz persisted, dry bulk freight markets reversed sharply, and demand for specific vessel types strengthened across South Asia.
The Strait of Hormuz remained a central risk for global shipping markets as negotiations between Washington and Tehran showed little progress. Commercial traffic continues through the region under uncertain operating conditions, while tighter sanctions enforcement and continuing geopolitical tensions are influencing vessel routing, insurance, compliance and trading decisions.
The shipping market is increasingly adapting to prolonged disruption rather than assuming a rapid return to normal conditions. Reports of vessels reducing transponder visibility while navigating the region further underline the operational uncertainty surrounding one of the world’s most important maritime corridors.
Oil markets moved higher during most of the week. Brent crude ended near USD 86.96 per barrel and WTI around USD 81.10, leaving crude prices approximately 5% higher on the week. Energy market fundamentals remained mixed, with the International Energy Agency increasing its estimate of the global oil supply deficit while U.S. crude inventories recorded their largest weekly increase since early 2023.
For ship recycling, one of the most important developments was another sharp reversal in the dry bulk freight market. The Baltic Dry Index declined to approximately 2,844, while the Capesize Index fell around 12% during the week to approximately 4,469. Panamax markets also lost momentum, while Supramax levels touched a nine-week low before stabilizing.
The decline in freight earnings could gradually improve the supply of recycling candidates by reducing the commercial attractiveness of keeping older vessels in operation. However, continued volatility across freight markets means many shipowners remain reluctant to commit tonnage, with trading earnings capable of changing rapidly from week to week.
Bangladesh remains the leading ship recycling destination on pricing, but the most notable development in Chattogram this week was a significant change in buying preference. After several weeks of caution toward tanker tonnage, recyclers became exceptionally aggressive for small and mid-sized tankers, pushing specialist tanker and container recycling indications higher.
Bangladesh tanker indications increased to approximately USD 470-475 per LDT, while container vessel indications reached around USD 480-485 per LDT. Dry bulk recycling indications remained around USD 445-450 per LDT.
The strength in tanker demand is particularly notable because local steel prices did not rise significantly. Bangladesh steel plate briefly strengthened during the week before returning to approximately BDT 64,000 per ton, indicating that higher tanker recycling prices are being driven primarily by buyer competition rather than stronger steel fundamentals.
The Chattogram August 12-15 delivery tide window remained active, with vessel movements continuing normally and the next significant tide window scheduled for August 28-31. Bangladesh’s July inflation reading also improved, easing to 8.32% from 9.16%, the lowest level recorded so far this year.
India’s Alang ship recycling market softened during Week 33 despite stronger local steel prices. Indian steel plate recovered from approximately INR 38,500 earlier in the week to around INR 39,500 per ton, yet recycling buyer appetite remained selective.
India’s July CPI increased to 4.45%, a 19-month high, adding pressure to the domestic economic outlook and raising expectations that monetary policy could become more restrictive later in the year.
Despite softer sentiment, Alang remains one of the most closely watched recycling markets due to the presence of FT Island, a 43,402 LDT oil tanker currently positioned for recycling. FT Island is one of the largest ship recycling candidates seen in the Indian sub-continent in recent months and represents a significant test of buyer appetite and yard capacity.
The Indian market also received an important confirmed transaction benchmark. The Pine Arrow, a 12,574 LDT general cargo vessel, was verified as delivered to Alang at USD 445 per LDT, providing the market with a valuable confirmed pricing reference during a period of limited reported sales.
India continues to retain significant structural advantages within the global ship recycling industry, including more than 115 valid Statements of Compliance, substantial recycling capacity and the ability to handle certain complex or compliance-sensitive vessel histories. Discussions surrounding the potential inclusion of additional Alang facilities on the European Union Ship Recycling List also remain closely monitored.
Pakistan’s Gadani ship recycling market remained one of the most stable destinations during the week. Local steel plate held near PKR 200,000 per ton, while recycling buyers continued to show firm interest in available tonnage.
The main constraint facing Gadani is not buyer appetite but the limited supply of suitable recycling candidates. Several previously secured vessels remain in transit, while new arrivals remain limited.
Pakistan continues to offer owners a relatively straightforward recycling proposition through stable currency conditions, strong domestic steel demand, no tidal delivery restrictions and active recycling yards. USD/PKR remained near 278.20, continuing an extended period of unusual currency stability.
Turkey’s Aliaga recycling market remained largely unchanged, with vessel recycling indications continuing between approximately USD 262 and USD 284 per LDT, depending on vessel type.
The Turkish Lira weakened further to approximately 47.83 against the U.S. Dollar, while inflation and monetary policy remain important domestic considerations. Turkey continues to compete primarily through European regulatory alignment, Basel Convention compliance and specialist vessel recycling capability, rather than through direct price competition with Bangladesh, India or Pakistan.
The Week 33 global ship recycling market presents an increasingly selective and vessel-specific environment. Bangladesh is competing aggressively for tanker tonnage, Pakistan remains stable and ready to purchase vessels, while India has softened despite stronger steel fundamentals and the presence of major recycling candidates.
At the same time, weakening dry bulk freight rates may gradually improve the supply of ships available for recycling. However, continued volatility in freight, oil markets and geopolitical conditions means owners remain cautious when deciding whether to continue trading older vessels or commit them for recycling.
For shipowners, cash buyers and ship recyclers, vessel type, delivery timing, compliance profile, local steel conditions and destination-specific demand are becoming increasingly important in determining achievable recycling values.
For detailed vessel indications, market rankings, steel prices, port positions and ship recycling analysis, access GMS Weekly through the GMS website or mobile app.
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