Strong tanker earnings and resilient dry freight markets restricted the supply of vessels for recycling in the third quarter of 2026, despite rising yard offers, Hellenic Shipping News reported. Buyers across the main recycling destinations retained capacity and appetite, but owners often had more attractive options in continued employment or second-hand sales.
At the beginning of July, GMS was monitoring an estimated 550 merchant ships preparing to leave the Gulf, including about 200 bulk carriers. Expectations that some vessels held back by earlier disruption would head for recycling were not fulfilled. By late September, yards were still taking delivery of earlier purchases but struggling to secure enough new deals to replenish their supply.
Freight returns helped explain owners’ reluctance. According to the report, the Baltic Dry Index reached 3,488 in early September, its highest reading since October 2021. Hellenic Shipping News also cited GMS as reporting some very large crude carrier employment above $1 million a day in Week 39. Such earnings increased the income owners would forgo by withdrawing ships from service, limiting the impact of stronger recycling bids.
Pakistan finished the quarter with the highest conventional price indications on the subcontinent. GMS figures for Week 39 put its dry bulk values at about $510 per light displacement tonne and tanker values at $530. Bangladesh stood at $500 and $520 respectively, while India reached $465 and $485. Pakistan’s prices had eased from Week 34 peaks as previously purchased ships arrived at Gadani and buyers covered some immediate requirements.
In Bangladesh, heavy rain and flooding disrupted operations and beaching around Chattogram. Activity subsequently recovered as delayed vessels moved through available beaching windows, but fresh purchases did not keep pace. The report cautioned that busier waterfronts reflected earlier transactions rather than necessarily signalling a sustained increase in new recycling commitments.
India presented a more differentiated market, with specialist and compliance-sensitive vessels attracting buying interest beyond conventional steel valuations. Two Indian facilities were proposed for the European List of Ship Recycling Facilities, although inclusion remained pending at quarter-end. More broadly, Hellenic Shipping News said sanctions exposure, ownership records and regulatory requirements shaped the pool of feasible buyers, making an executable transaction more important than the highest advertised price alone.