The major news from the week saw several beachings taking place - something that has been six months in the making (except for the beaching of two exceptions about a month ago). A limited number of vessels were granted NOCs (No Objection Certificates) this week, by the Director General of Shipping Department in Bangladesh. Based on the reported number of vessels at anchorage, the market should expect to see at least 14 vessels hitting the beaches of Chittagong, during the upcoming beaching tide.
17 yards load been inspected and approved by the Bangladesh environmental ministry last month and with the progress made so far this week the industry appears to be moving closer to reopening after having been out of action for the last 6 months.
Of the 17 yards that have obtained permission to beach, the majority of those have bought cash buyer 'as is' tonnage and there is still a significant quantity of that to go. Moreover, only a few of those 17 yards have opted against committing to new vessels, in order to see how the beachings proceed against the fierce protest of BELA amongst others.
It is worth stressing that less than 20% (17/105 yards) have received permissions and so a full reopening of the Bangladeshi market is far from complete. In fact, there is a feeling that no fresh/future permissions will be granted until those yards that have managed to beach units, can prove that they can satisfy the 62 conditions that have been set in front of them. If a few more deals are to be done, relevant NOCs granted and inward clearance permission obtained, it is still worth being cautiously optimistic on both price and the realities of a tougher and far more complex and arduous arrivals / clearance procedure.
Of course, there will be no resting easy until the physical beaching of these 14 vessels takes place, but the signs at this stage are promising. There is some suggestion locally that no more NOCs will be issued for the time being, so if a reopening is to occur off the back of this week's activity, it will be a case of slowly but surely.
Source: SteelGuru; Tuesday, 16 Nov 2010
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