ISSN 2046-7575 Global

Daily Report | Monday 8 October, 2012 Issue Number | 4198

Tanker Markets Dry Bulk Chartering Markets Baltic dry indices 1 VLCC PANAMAX BDI BCI BPI BSI BHSI INDEX 883 1921 647 791 444 A slow start to the week with limited fresh enquiries. Pacific: The general sentiment is that the Pacific day U ▲ 8 ▼ -11 ▲ 49 ▼ -4 ► 0 week U ▲ 106 ▲ 261 ▲ 208 ▼▼-34 -23 We expect another 20-25 cargoes remaining for market is improving. We are seeing a lot of fresh October against 57 vessels available in the Middle dry bulk TC averages $/day business for a Monday especially out of Indonesia. East Gulf. It is fairly quiet in the Atlantic. Rates for Indo rounds still remain unchanged 35,000 Capesize Panamax Supramax Handysize compared to end of last week around $5,500 + 30,000 Suezmax $70/80K but we are also hearing some owners 25,000 The confidence that was gained towards the end of talking DOP rates. Both Owners and Charterers are 20,000 last week has been deflated slightly with a West still showing interest for short period business. Africa market cargo getting over a handful of offers 15,000 and a few ships failing subs - expect rates to Atlantic: Sentiment in the Atlantic remains positive, 10,000 even though most Owners and Charterers are continue going sideways for now. The Med. has waiting to see how things will pan out this week. For 5,000 seen slower rates with light Black Sea enquiries a trans-Atlantic round voyage most owners are now 0 Oct 11 Dec 11 Feb 12 Apr 12 Jun 12 Aug 12 Oct 12 Aframax asking around the $6,000 level, with Charterers there to pay around $4,000 level. Front haul activity Baltic TC averages1 and forward curves2 Mediterranean Aframax’s were slow with weak out of the USG remains strong, with a number of $/DAY CAPE PMAX SMAX HSIZE enquiry levels putting further downward pressure on fresh stems in the market and rates hovering SPOT 11 172 5 155 8 271 6 531 the rates which currently hover at a W75 level for dayU ▼ - 65 ▲ 386 ▼ - 44 ▼ - 4 around the low $14,000s + low $400,000s on the cross-Med. voyage with ample tonnage available. CURQ 11 657 7 111 8 907 7 454 BB. dayU ▼ - 510 ▼ - 391 ▼ - 83 ▼ - 23 Some activity was seen leaving ex. Baltic with a +1Q 7 680 6 639 7 880 6 988 charterer paying W55 for a Baltic to Spanish Atlantic dayU ▼ - 353 ▼ - 336 ▼ - 95 ▼ - 75 HANDYSIZE/SUPRAMAX +2Q 9 490 8 682 9 080 7 925 voyage whilst negative sentiment ensues with Pacific: Whilst most players return in the Far East, dayU ▼ - 335 ▼ - 272 ▼ - 45 ▼ - 63 extensive tonnage remaining. +3Q 11 510 6 671 8 440 7 350 it has to be said that it has been a slow start to the dayU ▼ - 315 ▼ - 229 ▼ - 18 ▼ - 50 Panamax week with the Chinese taking their time to re-enter +4Q 13 510 8 636 8 580 8 025 the market. Rates for Indonesia/India are lower than dayU ▼ - 298 ▼ - 250 ▼ - 20 ▲ 25 A slow start to the week in the Caribbean with rates +1CAL 10 548 7 657 8 495 7 572 the same point last week, and there is still a variety flat at around the W112.5 level on 50,000 metric dayU ▼ - 325 ▼ - 272 ▼ - 45 ▼ - 41 and sufficiency of prompt tonnage in both the Indian +2CAL 13 700 9 304 10 040 8 475 tonne vessels for the Caribs/USG run. Rates are flat Ocean and Far East hoping for some resurgence in dayU ▼ - 267 ▼ - 182 ▼ - 2 ▲ 25 at W127.5 for UKC/TA voyages on 55,000 metric +3CAL 15 230 11 171 11 390 9 850 cargo interest. Short period takers are looking to tonne vessels. dayU ▼ - 170 ▼ - 115 ▼ - 56 ▼ - 13 break the $9k mark on good types, although there Capesize spot TC average and FFA front quarter Clean East is resistance to this. South Africa is still suffering

35,000 front quarter TC average uncertainty with regards to cargo readiness due to TC5 – Still waits for the injection of enquiry needed strikes in the mining and transport sector, ships in 30,000 to move off the last done rate price of W102.5. Lets ballast face the unwelcome prospect of a long wait 25,000 hope tomorrow has more in store. or simply carrying on to ECSA. 20,000 Clean West 15,000 Atlantic: With last week being somewhat of a damp squid given the numerous national holidays, 10,000 TC2 – A typical quiet Monday with tonnage stacking up; rumours of W127.5 now on subs. everybody is looking expectantly to this week for 5,000 direction. We expect activity in the Gulf to remain 0 Tanker Derivatives stunted while we wait for second half October Oct 11 Dec 11 Feb 12 Apr 12 Jun 12 Aug 12 Oct 12 Monday saw another day of low volumes with TD3 cargos to come into the market. In the south ICAP Shipping indices3 trading a point and a quarter down on Friday’s Atlantic we see rates for front haul remaining today day Δ week Δ flattish, whilst given the volume of tonnage wishing JEHSUP (52k) $/day 8 338 0 - 388 W44.25 close – it was left W43/W44. DEC took very JEHSUP (52k) index 1 108 0 - 50 little time in replicating Friday’s closing spread of to stay in the Atlantic TA levels have softened JEHMA (45k) $/day 6 625 0 - 313 W47.5/W48.5, but little further action was slightly. In the Black Sea, spot / prompt tonnage ICAP Shipping 1yr period rate assessments3 witnessed. TD7 OCT traded at W87 and TD5 saw remains, and levels continue to be flat with ratings today day Δ week Δ tight markets, but failed to trade. TC2 had an for front haul at around $13k from Charterers and CAPESIZE 170k 0 - 11,250 - 11,000 unusually quiet day, but TC14 saw NOV trade at $15k from Owners. With little seen or expected in 0 - 8,000 - 8,000 PANAMAX 72k terms of new orders, the north Continent market SUPRAMAX 52k 0 - 9,250 - 9,250 W76, again flying in the face of BITRA’s 85 HANDYMAX 45k 0 - 8,750 - 8,750 valuation. It was, however, well bid at that level. remains predictably flat. It is difficult to gauge the HANDYSIZE 28k 0 - 8,250 - 8,250 Further down the curve, TC14 Q1 2013 traded at outbound levels as so little has been fixed in the ICAP Container Derivatives 19.1$/t and was offered over at that level. With last fortnight given that Supramax scrap into East today day Δ week Δ Golden Week, Columbus Day and other assorted Med is paying about $13k expect outbound rates to $1,062.50 $0.00 -$100.00 NWE $/TEU Jul-12 holidays over the last week or so, we hope Tuesday achieve about 2/3k more than this. NWE $/TEU Aug-12 $1,250.00 $25.00 $150.00 NWE $/TEU Sep-12 $1,075.00 $0.00 -$50.00 to see the return of better volumes to the market. Thought of the Day NWE $/TEU Q3 12 $1,130.00 $10.00 $80.00 NWE $/TEU Q4 13 $1,150.00 $27.50 $60.00 Thought of the Day In the end of September, an Italian judge already NWE $/TEU Q1 13 $1,287.50 $0.00 $12.50 Capital investment for energy projects, including oil, rejected a plan which aims to invest 400 million $1,500.00 $0.00 $0.00 NWE $/TEU Q2 13 euros to modernise the ILVA steel plant whilst NWE $/TEU Jul-Dec $1,130.00 $10.00 $22.50 gas, petrochemicals and power industries, are NWE $/TEU Cal 13 $1,375.00 $0.00 $0.00 ICAP Shipping Global Shipping Markets Continues on Page 2... ICAP Shipping Tanker Assessment Route TD3 TD5 TD7 TC2 TC4 TC5 WS 35.50 57.50 85.00 130.00 135.00 110.00 expected to amount to $740 billion in the Middle East keeping it open. Yesterday Italian prosecutors U ►0.00 ►0.00 ►0.00 ►0.00 ►0.00► 0.00 and North Africa between 2013 and 2017. According ordered this plant to begin shutting down within five $/day -$1,724 $4,343 $987 $7,457 $3,457 $6,752 to the APICORP report, Saudi Arabia will be in the days because of its pollution issues. This plant is 4 2 Baltic tanker routes and ICAP Shipping forward curves lead position investing $165 billion within which the largest steel plant in Europe and it produced WS TD3 TD5 TC2 TC6 Saudi Arabian Oil Co. and Saudi Basic Industries around 8.5 million tonnes of crude steel last year. SPOT 35.19 57.32 130.00 158.28 dayU ▼ -0.08 ▼ -0.18 ▼ -0.42 ▼ -0.33 Corp. (SABIC) play a vital role; It is followed by Unfortunately the shutdown of this plant seems CURMON 37.50 58.75 127.00 152.50 U.A.E ($107 billion) with Algeria coming next ($71 inevitably to threaten Italy’s iron ore imports, mainly dayU ► 0.00 ► 0.00 ► 0.00 ► 0.00 billion), outstripping both Qatar and Iran. The from Brazil. Last year Italy imported more than 11 +1M 43.25 65.00 128.00 153.00 dayU ▼ -1.00 ► 0.00 ► 0.00 ► 0.00 APICORP report also pointed out that those energy million tonnes of iron ore from Brazil. Due to the +2M 48.00 68.00 136.50 161.00 projects could finance themselves if the basket large scale of this plant’s blast furnaces, once they dayU ▲ 0.25 ▲ 0.50 ► 0.00 ► 0.00 +3M 44.32 61.45 126.00 154.00 of OPEC crude's was over $100 bbl. are shut down, there seems to be little hope that dayU ► 0.00 ► 0.00 ▼ -2.00 ► 0.00 they can be re-started in a short-term. +4M 44.10 60.00 122.00 149.75 dayU ► 0.00 ► 0.00 ▼ -1.50 ► 0.00 +5M 44.10 60.00 122.00 147.75 dayU ► 0.00 ► 0.00 ▼ -0.50 ► 0.00 +1Q 44.17 60.48 123.33 150.50 dayU ► 0.00 ► 0.00 ▼ -1.33 ► 0.00 +2Q 41.75 58.50 117.25 132.50 dayU ► 0.00 ► 0.00 ► 0.00 ► 0.00 +3Q 41.00 58.50 115.00 144.00 dayU ► 0.00 ► 0.00 ► 0.00 ► 0.00 +4Q 41.70 60.00 125.00 141.50 dayU ► 0.00 ► 0.00 ► 0.00 ► 0.00 +1CAL 42.16 59.37 120.15 142.13 dayU ► 0.00 ► 0.00 ▼ -0.33 ► 0.00

+2CAL 41.75 61.58 128.00 143.00 dayU ► 0.00 ► 0.00 ► 0.00 ► 0.00

Tanker spot rates - main traded contracts WS

250 TC2_37 TC4 TD3 TD5 200

150

100

50

0 Oct 11 Dec 11 Feb 12 Apr 12 Jun 12 Aug 12 Oct 12

Currency grid - at 1245 EST 5 USD GBP EUR JPY USD - 1.6023 1.2969 0.01280 GBP 0.6241 - 0.8094 0.00799 Containers EUR 0.7711 1.2355 - 0.00987 JPY 78.140 125.202 101.340 - Other indicators C.H Robinson Worldwide has completed its USD countries will remain modest, with any recovery in price day Δ price day Δ 635m purchase of Phoenix International, an the region driven by strong domestic demand in Brent $/bbl6 112.26 ▲ 0.07 1yr % 0.954 ▼ -0.001 acquisition that is nearly double the size of C.H developing countries. The report also suggests that 6 89.88 ▼ -1.83 Euribor Euro 0.666 ▼ -0.004 WTI $/bbl Robinson. The acquisition sends a clear message weak exports and lower investment growth will cut Gasoline ¢/g6 324.25 ▲ 0.96 API2$/t q4127 89.40 ▲ 0.50 IFO380 $/t 637.63 ▼ -2.63 API4$/t q412 87.90 ▲ 0.45 about its global ambitions and provides a strong China’s GDP growth to 7.7 percent from 9.2 percent IFO180 $/t 665.88 ▼ -0.75 API2/4$/t q412 1.50 ▲ 0.05 competitive position to capitalize on growth recorded in 2011. China’s growth will then rebound MDO $/t 1013.75 ▲ 16.25 Newc$/t q412 88.60 ▲ 0.20 opportunities whilst expanding market share. to 8.1 percent in 2013 as stimulus measures begin to Crude Oil Prices (WTI, Brent and Dubai USD/bbl)6 According to CEO Nils Smedegaard, A.P Moller kick in, helped by an increase in global trade. HTC $140 Maersk is ready to grow regardless of the Corp, Asia’s second largest smartphone market has $130 macroeconomic environment. It was indicated that posted a 79 percent drop in quarterly profit as $120 because the company has created a strong competitors drove down sales. Third quarter net $110 foundation their task for the coming five years will be income declined to USD 133m, which missed $100 to grow the business despite the tough economic analysts’ previous expectations. Financial institution $90 climate. According to the World Bank’s East Asia Hana Daetoo Securities has lowered its target price $80 WTI and Pacific Economic Data Monitor, economic on Hanjin Shipping and suggests that they will not be $70 Brent growth in the East Asia and Pacific region is able to meet analyst’s expectations with regards to $60 Dubai expected to slow from 8.2 percent in 2011 to 7.2 their financial statements for the third quarter. The Oct 11 Dec 11 Feb 12 Apr 12 Jun 12 Aug 12 Oct 12 percent in 2012, before a recovery to 7.6 percent in company also pointed towards a weak outlook for 1 Baltic Exchange 1300, 2 Baltic Exchange 1800 , 3 ICAP Shipping 1300, 4 Baltic Exchange 1630, 5 Oanda, 6 Bloomberg (Spot), 7 ICAP Energy 5Oct [ time unless stated] 2013. The study indicated that growth in developed container activities within the fourth quarter. *trading-daily change in ICAP Shipping intraday FFA assessments - may not reflect current market levels upon receipt due to market volatility – call your broker for latest ICAP Shipping Global Shipping Markets

© ICAP Shipping International Limited (“ICAP Shipping”) 2012. ICAP Shipping International Limited, 2 Broadgate, London EC2M 7UR +44 20 7459 2000 This report has been prepared by ICAP Shipping or its affiliates ("ICAP Shipping") and is addressed to ICAP Shipping customers only and is for distribution only under such circumstances as may be permitted by applicable law. This information has no regard to specific investment objectives, financial situation or particular needs of any specific recipient. It is published solely for informational purposes and this information is not, and should not be construed as, an offer or solicitation to sell or buy any product, investment, security or any other financial instrument. ICAP Shipping does not make any representation or warranty, express or implied, as to the accuracy, completeness or correctness of the information contained herein, nor is it intended to be a complete statement or summary of the securities, markets or developments referred to in the report. Neither ICAP Shipping, nor any of its directors, employees or agents, accepts any liability for any loss or damage, hownersoever caused, arising from any reliance on any information or views contained in this report. While this report, and any opinions expressed in it, have been derived from sources believed to be reliable and in good faith they are not to be relied upon as authoritative or taken in substitution for the exercise of your own commercial judgment. Any opinions expressed in this report are subject to change without notice and may differ from opinions expressed by other areas of the ICAP group. ICAP Shipping is under no obligation to update or keep current the information contained herein. This report may not be reproduced or redistributed, in whole or in part, without the written permission of ICAP Shipping and ICAP Shipping accepts no liability whatsoever for the action of third parties in the respect. Certain companies in the ICAP Shipping group are authorised and regulated by the Authority. This information is the intellectual property of ICAP Shipping. ICAP Shipping and the ICAP Shipping logo are trademarks of the ICAP group. All rights reserved.

Baltic Exchange Disclaimer: Customers of ICAP Shipping who receive Baltic Exchange information from us are limited only to use that information for their own internal purposes. It is provided to you on the understanding that you shall NOT copy it or pass it on to any other organisation or extract, re-distribute or re-utilise it in any form. Freight Derivatives Sale and Purchase Projects Dry Cargo Tankers Research Dry Operations Tanker Operations [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] [email protected] Compiled by ICAP Shipping Research Mr. J. Leake, Mr. G. Slavov, Mr. S. Newman, Ms. S. Betsakou, Mr. R. Guo, Mr. S. Ljubisavljevic, Mr. O. Burdick, Mr. L. Zhang ICAP Shipping Derivatives Limited and ICAP Shipping Tanker Derivatives Limited are authorised and regulated by the Financial Services Authority www.icapshipping.com Fixture report | Monday 08 October 2012

TIMECHARTER 'Anangel Astronomer' 2012 180000 dwt dely Shanghai 10/15 Oct trip via East or West Australia redel China $15500 daily - Noble 'King Barley' 2012 82177 dwt dely Antwerp 11/16 Nov trip via Baltic redel UKC $4500 daily - cnr 'Guo Yuan 12' 2011 75971 dwt dely Guangzhou 9/13 Oct trip via Newcastle redel China $4000 daily - Klaveness 'Legiony Polskie' 1991 73505 dwt dely Gibraltar ppt trip via Hampton Roads redel Med $4750 daily - United 'Full Sources' 1994 69573 dwt dely aps Astoria 11/20 Oct trip redel Singapore-Japan $6000 daily + $330000 bb - Bunge 'Kesari Prem' 1997 69186 dwt geared dely Singapore spot trip via EC Australia redel India $8500 daily - Oldendorff 'Bulk Uruguay' 2011 57937 dwt dely aps SW Pass 15/22 October trip redel Japan intention grain $18600 daily - cnr 'Christos Theo' 2010 56838 dwt dely Tanjung Priok spot trip via Indonesia redel India $11500 daily - Oldendorff 'Queen Kobe' 2008 55444 dwt dely aps Abbot Point mid/end October trip redel Japan $8000 daily + $200000 bb - cnr 'Bulk Indonesia' 2011 97740 dwt dely Krishnapatnam 5/9 Oct 4/7 months trading redel worldwide $7000 daily - Cobelfret 'Hephaestus' 2001 74306 dwt dely Hong Kong spot 6/10 months trading redel worldwide $7000 daily - Bunge

ORE 'Mangas' 2011 160000/10 Dampier/Qingdao 20/25 Oct $9.00 fio scale/30000shinc - Rio Tinto 'TBN' 135000/10 Nouadhibou/Qingdao 20/30 Oct $25.75 fio 30000shinc bends - Bunge

COAL 'Milos Warrior or sub' 2011 170000/10 Seven Islands/Rotterdam 25 Oct/8 Nov $6.95 per lt fio 6 days shinc - TKS 'F.D.Isabella' 2009 60000/10 Houston/Brindisi 20/29 Oct approx $19.00 fio 20000shinc/12000shinc - United

Source: Baltic Exchange / ICAP Shipping

© ICAP Shipping International Limited (“ICAP Shipping”) 2012. This information is addressed to ICAP Shipping customers only. While it, and any opinions expressed in it, have been derived from sources believed to be reliable and in good faith they are not to be relied upon as authoritative or taken in substitution for the exercise of your own commercial judgment. This information has no regard to specific investment objectives. Any opinions expressed in it are subject to change without notice and may differ from opinions expressed by other areas of the ICAP group. This information is not, and should not be construed as, an offer or solicitation to sell or buy any product, investment, security or any other financial instrument. ICAP Shipping does not make any representation or warranty, express or implied, as to the accuracy, completeness or correctness of this information. ICAP Shipping does not accept any liability for any loss or damage, howsoever caused, arising from any reliance on any information or views contained in this material. Certain companies in the ICAP Shipping group are authorised and regulated by the Financial Services Authority. For further regulatory information, please see www.icap.com. This information is the intellectual property of ICAP Shipping. ICAP Shipping and the ICAP Shipping logo are trademarks of the ICAP group. All rights reserved. Redistribution is prohibited. Baltic Exchange Disclaimer: Customers of ICAP Shipping who receive Baltic Exchange information from us are limited only to use that information for their own internal purposes. It is provided to you on the understanding that you shall NOT copy it or pass it on to any other organisation or extract, re-distribute or re-utilise it in any form.