《船舶贸易与经营》课程教学资源：The Clarkson SHIPPING REVIEW & OUTLOOK.pdf_P16-P20

SHIPPING MARKET OUTLOOK 2000s,bulk carrier deliveries were running fleet grew by 13.7%in 2011 and is expected to fairly steadily at around 22m dwt per annum. grow by 15.8%in 2012,followed by 11.5%in After the recession had started,deliveries 2013.A challenging prospect. jumped to 80m dwt in 2010,99m dwt in 2011, and the current forecast for 2012 is 110m dwt. The Handymax Market(40-60,000 dwt) This has propelled the bulk carrier fleet from 458m dwt at the end of 2009,just after Lehman On 1st September 2012 the Handymax bulk icensed to The Brothers crisis,to 692m dwt by the end of carrier fleet consisted of 2,643 ships of 136.9m 2012.That is an increase of 51%in three years dwt.The orderbook was 488 vessels of 26.1m during which the volume of dry bulk trade has dwt,accounting for 19%of the fleet.So increased by around 20%. although this segment is not as heavily ordered as Panamax vessels,it has a sizable amount of The Capesize Market (100,000 dwt) tonnage to absorb over the next two years.We expect deliveries of 18.7m dwt in 2012 and On 1st September 2012 the Capesize fleet was 12.6m dwt in 2013.With scrapping of just over 1,490 ships of 274m dwt,up 8.3%since the 3m dwt per annum the fleet is expected to grow Kong Polytechnic University. start of March.The orderbook now consists of at about 11%in 2012 and 7%in 2013. 283 ships of 58m dwt,with expected deliveries in 2012 of 49m dwt,followed by 22m dwt in The Handysize Market(10-40,000 dwt) 2013.So the torrent of tonnage is not over yet. But investment has slowed over the last year On 1st September 2012 the Handysize bulk and the orderbook is 30%lower than six carrier fleet consisted of 3,060 vessels of 85.7m months ago.On current trends,after falling to dwt.In addition there was an orderbook of 445 22m dwt in 2013,deliveries are expected to vessels of 14.6m dwt.That works out at 17%of Distribution is restricted: drop to 11m dwt in 2014.Although that sounds the fleet on order,the lowest of any segment of like good news,even 11m dwt should be the bulk carrier fleet.With deliveries of around sufficient to meet the current demand growth 10.8m dwt expected in 2012 and 6m dwt in please for these very big ships.Scrapping has also 2013,the fleet is projected to grow by around been firm,with 7.9m dwt of Capesize bulk 4%in 2012 and by just 1%in 2013.A not carriers scrapped so far in 2012,some of these unfamiliar pattern for this small and elderly vessels scrapped at pretty young ages.The segment of the fleet. combination of this overhang of tonnage with recent concerns over the future of the Chinese The Bulk Carrier Market Outlook economy suggests that this segment of the fleet acknowledge has a way to go before it gets back to normal. There is little new to say about the bulk carrier market.The demand side forecasts suggest The Panamax Market(60-100,000 dwt) reasonable growth of around 4%per annum, somewhat below the average rates of the last the source On 1st September 2012 the Panamax bulk decade,but reasonably in line with long-term carrier fleet was 2,216 ships of 171m dwt,a trends in the dry bulk business.The main 7.5%growth rate over the last six months.The concern is the growing recession in the OECD orderbook now consists of 711 ships of 55.8m countries,big users of bulk transport,and the dwt,about 33%of the fleet.That is down from possibility that China might reach a new phase 40%of the fleet six months ago,but is now by in its development that could undermine the all far the biggest orderbook of any segment of the important iron ore trade.On the supply side dry bulk market (the others are about 20%of fleet growth remains the major issue.If our the fleet).As a result deliveries are buoyant, projected growth rate for the bulk carrier fleet with 23.8m dwt delivered in 2011,and 32m dwt of 13%in 2012 and 6.4%in 2013 is realised, expected for 2012,probably the peak of the the market for bulk carriers will get worse cycle.Demolition activity has also been high in before it gets better.So,the immediate outlook the Panamax sector,with 5.4m dwt of vessels remains bleak,and as we commented last time, http://www.clarksons.nel 01/11/2012 06:20:04 15304 scrapped in the first eight months of the year, the real challenge is to guess how long the up by around 69%on last year.So overall the downturn will continue. Clarkson Research Services 18 Autumn 2012

Clarkson Research Services 18 Autumn 2012 SHIPPING MARKET OUTLOOK 2000s, bulk carrier deliveries were running fairly steadily at around 22m dwt per annum. After the recession had started, deliveries jumped to 80m dwt in 2010, 99m dwt in 2011, and the current forecast for 2012 is 110m dwt. This has propelled the bulk carrier fleet from 458m dwt at the end of 2009, just after Lehman Brothers crisis, to 692m dwt by the end of 2012. That is an increase of 51% in three years during which the volume of dry bulk trade has increased by around 20%. The Capesize Market (> 100,000 dwt) On 1st September 2012 the Capesize fleet was 1,490 ships of 274m dwt, up 8.3% since the start of March. The orderbook now consists of 283 ships of 58m dwt, with expected deliveries in 2012 of 49m dwt, followed by 22m dwt in 2013. So the torrent of tonnage is not over yet. But investment has slowed over the last year and the orderbook is 30% lower than six months ago. On current trends, after falling to 22m dwt in 2013, deliveries are expected to drop to 11m dwt in 2014. Although that sounds like good news, even 11m dwt should be sufficient to meet the current demand growth for these very big ships. Scrapping has also been firm, with 7.9m dwt of Capesize bulk carriers scrapped so far in 2012, some of these vessels scrapped at pretty young ages. The combination of this overhang of tonnage with recent concerns over the future of the Chinese economy suggests that this segment of the fleet has a way to go before it gets back to normal. The Panamax Market (60-100,000 dwt) On 1st September 2012 the Panamax bulk carrier fleet was 2,216 ships of 171m dwt, a 7.5% growth rate over the last six months. The orderbook now consists of 711 ships of 55.8m dwt, about 33% of the fleet. That is down from 40% of the fleet six months ago, but is now by far the biggest orderbook of any segment of the dry bulk market (the others are about 20% of the fleet). As a result deliveries are buoyant, with 23.8m dwt delivered in 2011, and 32m dwt expected for 2012, probably the peak of the cycle. Demolition activity has also been high in the Panamax sector, with 5.4m dwt of vessels scrapped in the first eight months of the year, up by around 69% on last year. So overall the fleet grew by 13.7% in 2011 and is expected to grow by 15.8% in 2012, followed by 11.5% in 2013. A challenging prospect. The Handymax Market (40-60,000 dwt) On 1st September 2012 the Handymax bulk carrier fleet consisted of 2,643 ships of 136.9m dwt. The orderbook was 488 vessels of 26.1m dwt, accounting for 19% of the fleet. So although this segment is not as heavily ordered as Panamax vessels, it has a sizable amount of tonnage to absorb over the next two years. We expect deliveries of 18.7m dwt in 2012 and 12.6m dwt in 2013. With scrapping of just over 3m dwt per annum the fleet is expected to grow at about 11% in 2012 and 7% in 2013. The Handysize Market (10-40,000 dwt) On 1st September 2012 the Handysize bulk carrier fleet consisted of 3,060 vessels of 85.7m dwt. In addition there was an orderbook of 445 vessels of 14.6m dwt. That works out at 17% of the fleet on order, the lowest of any segment of the bulk carrier fleet. With deliveries of around 10.8m dwt expected in 2012 and 6m dwt in 2013, the fleet is projected to grow by around 4% in 2012 and by just 1% in 2013. A not unfamiliar pattern for this small and elderly segment of the fleet. The Bulk Carrier Market Outlook There is little new to say about the bulk carrier market. The demand side forecasts suggest reasonable growth of around 4% per annum, somewhat below the average rates of the last decade, but reasonably in line with long-term trends in the dry bulk business. The main concern is the growing recession in the OECD countries, big users of bulk transport, and the possibility that China might reach a new phase in its development that could undermine the all important iron ore trade. On the supply side fleet growth remains the major issue. If our projected growth rate for the bulk carrier fleet of 13% in 2012 and 6.4% in 2013 is realised, the market for bulk carriers will get worse before it gets better. So, the immediate outlook remains bleak, and as we commented last time, the real challenge is to guess how long the downturn will continue. Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304 Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304

SHIPPING MARKET OUTLOOK 1.6 Tanker Market Outlook Summary of the Oil Trade Oil Demand (IEA) h 207 20H08 2010 2011 The profile of the tanker market during 2012 OECD Europe 0.00 followed a pattern quite similar to 2011.A 00% 4 79 North America 25.1 23.9 strong first quarter was followed by a rapid 0.4 4.9呢 OECD Pacific 84 8.0 7.7 decline in earnings,reaching a trough in -0.9% -3.9% 4.4呢 Non-OECD Asia 17.1 17.4 18.3 19.6 20.3 August,followed by an embryonic recovery in 4.8% September.If the pattern of 2011 is repeated, Others 20.5 2.0% 62% things should improve during the last quarter of TOTAL 86.4 86.4 2.4% 0.0% icensed to The Hong 88.8 89.6 1.4% 0a.0% -1.0% 3.0% 0.7% 1.0% the year.The logic is that the underlying Crude Oil Supply◆ surplus is considerably smaller in tankers than 2007 2008 2009 2010 2011 2012(0 H in bulk carriers,thanks to lower investment and OPEC◆ 22 23.0 the impact of the phasing out of the single hull Non-OPEC M.East .3 tanker fleet during the boom.The moderate 0.0% 4.1 Total Long Haul 224 23.0 213 213 22.9 23.5 deliveries profile combined with a 29%increase -2.4% 29呢 7.6% 0.0 75 10.3紧 Short Haul in demolition this year,has resulted in fleet Non-Gulf OPEC 98 9.7 Kong Polytechnic University Dortyol Exports 0 0.4 growth of about 2.7%over the last half year 50 4.8 4.6 39035 This is faster than demand growth,but oil 39.5 39.7 41.4 Total Short Haul 53.9 54.0 532 53.7 movements are notoriously seasonal. By Net Importers TOTAL Tanker Demand Outlook Di D 0.3% 0.9 -1.2% 4 2.8% Note:Long Haul Gulf OPEC excludes short haul Iraqi exports Source:IEA Stats.Total includes NGLs and processing gains World oil demand continues to be very Crude Exports sluggish,with the IEA predicting demand (MBpd) 2007 2008 2009 2010 2011 20120 Middle East 15.2 158 14.8 15.7 17.3 17.3 growth of only 0.8m bpd (1%)in 2012, (Long Haul) 2.3% 3.9 6.5% 5.9% 103宽 01% North Sea 3. 2.7 2.7 2.5 2.1 reaching 89.6m bpd.Expected growth for 2013 2% 125% 1.2% 8.6% 4% Africa is similar.As shown in Table 1.4,demand in 10 is restncted:please 7.1 6.8 58 20% 1.6% 1.1% 14.3% Europe is declining and in N.America is Caribs L.Am 5.0 4.4 growing at around 1.8%in 2012.However this 23.8% is complemented by a much faster growth in the 37.0% 80.3% 14.1% Short Medium 23.0 22.4 212 21.7 19.4 20.1 ember OECD Pacific region where oil demand is Haul TOTAL %警 projected to increase by 3.7%in 2012.So the 0.7% -0.1% -5.8% 39o .2.0 20 Long Haul exports over 5.000 miles from their main markets. result is a trade-off between the weakness of the Crude Imports (MBod) 2007 2008 2009 2010 2011 2012(fT North Atlantic and the moderate growth in the United States 8.1 7.8 7.1 7.2 6.7 acknowledge Pacific,giving a total oil demand growth rate in 2.2% 3.8% 9.6% 2.4缆 7.49% EU Europe 10.1 9.2 2012 of around 1%. Japan Could oil imports follow this general pattern of Other Asia the source 3.8% demand?The most rapidly growing importer of Others 4.7 4.6 41 crude is Asia (excluding Japan),where imports WORLD TOTAL 器 are expected to grow by 9.4%in 2012.But 0.7凳 -01% Dwt Demand 250.4 253.0 European imports are projected to fall 3.8%and Products Imports (MBod) 2007 2008 2009 2010 2011 2012(0 US imports by 7.1%,reflecting both lower United States 2.9 2.6 2.1 2.0 1.9 1.8 5.6% -9.8% 173% 5.3% 3% demand growth and the unexpectedly strong 8.4% EU Europe 4.9 5.4 5.6 55 growth of domestic oil production.This -2.6% apan realignment of trade towards Asia has resulted in eastbound cargoes from the AG growing Other Asia 5.1 61 5.5% 6.6% strongly whilst westbound cargo is stagnating. Others 2.6 2.8 2.9 25.3% 83% 1.79% 13.6% 7.9% 9.99% At the same time there has been a sizable WORLD TOTAL 162 16.7 16.8 17.6 18.1 18.6 2.9亮 increase in the volume of cargo moving from 2.9% 0.9% 5.0% 2.5% Dwt Demand 87.489.6 88.2 88.8 96.0 the Atlantic to Asia,and the resulting Source:Oil and Tanker Trades Outlook:Clarkson Research Services. Statistics derived from IEA data.f=forecasts. http://www.clarksons.nel 01/11/2012 06:20:04 15304 triangulation trade has come to dominate the big tanker market.Although interesting,this Table 1.4 Summary of the Oil Trade Clarkson Research Services 20 Autumn 2012

Clarkson Research Services 20 Autumn 2012 SHIPPING MARKET OUTLOOK The profile of the tanker market during 2012 followed a pattern quite similar to 2011. A strong first quarter was followed by a rapid decline in earnings, reaching a trough in August, followed by an embryonic recovery in September. If the pattern of 2011 is repeated, things should improve during the last quarter of the year. The logic is that the underlying surplus is considerably smaller in tankers than in bulk carriers, thanks to lower investment and the impact of the phasing out of the single hull tanker fleet during the boom. The moderate deliveries profile combined with a 29% increase in demolition this year, has resulted in fleet growth of about 2.7% over the last half year. This is faster than demand growth, but oil movements are notoriously seasonal. Tanker Demand Outlook World oil demand continues to be very sluggish, with the IEA predicting demand growth of only 0.8m bpd (1%) in 2012, reaching 89.6m bpd. Expected growth for 2013 is similar. As shown in Table 1.4, demand in Europe is declining and in N. America is growing at around 1.8% in 2012. However this is complemented by a much faster growth in the OECD Pacific region where oil demand is projected to increase by 3.7% in 2012. So the result is a trade-off between the weakness of the North Atlantic and the moderate growth in the Pacific, giving a total oil demand growth rate in 2012 of around 1%. Could oil imports follow this general pattern of demand? The most rapidly growing importer of crude is Asia (excluding Japan), where imports are expected to grow by 9.4% in 2012. But European imports are projected to fall 3.8% and US imports by 7.1%, reflecting both lower demand growth and the unexpectedly strong growth of domestic oil production. This realignment of trade towards Asia has resulted in eastbound cargoes from the AG growing strongly whilst westbound cargo is stagnating. At the same time there has been a sizable increase in the volume of cargo moving from the Atlantic to Asia, and the resulting triangulation trade has come to dominate the big tanker market. Although interesting, this 1.6 Tanker Market Outlook Table 1.4 Summary of the Oil Trade Summary of the Oil Trade Oil Demand (IEA)* (MBpd) 2007 2008 2009 2010 2011 2012(f) OECD Europe 15.3 15.3 14.7 14.7 14.3 14.0 0.0% 0.0% -4.4% 0.1% -2.7% -2.0% North America 25.1 23.9 23.0 23.5 23.3 23.7 0.4% -4.9% -3.7% 2.2% -0.9% 1.8% OECD Pacific 8.4 8.0 7.7 7.8 7.9 8.1 -0.9% -3.9% -4.4% 1.7% 0.4% 3.7% Non-OECD Asia 17.1 17.4 18.3 19.6 20.3 20.7 4.8% 2.0% 4.9% 7.5% 3.4% 2.3% Others 20.5 21.7 21.9 22.5 23.1 23.1 2.0% 6.2% 0.9% 2.7% 2.4% 0.0% TOTAL 86.4 86.4 85.5 88.1 88.8 89.6 1.4% 0.0% -1.0% 3.0% 0.7% 1.0% Crude Oil Supply * (MBpd) 2007 2008 2009 2010 2011 2012(f) Long Haul Gulf OPEC* 22.1 23.0 21.2 21.2 22.8 23.4 -2.1% 4.1% -7.7% 0.0% 7.6% 2.7% Non-OPEC M. East 0.4 0.4 0.5 0.5 0.4 0.4 -4.4% 2.3% 2.3% 0.0% -4.4% -4.7% Total Long Haul 22.4 23.0 21.3 21.3 22.9 23.5 -2.4% 2.9% -7.6% 0.0% 7.5% 10.3% Short Haul Non-Gulf OPEC 9.8 9.7 9.0 9.6 8.5 9.3 Dortyol Exports 0.1 0.4 0.4 0.4 0.4 0.4 Europe 5.0 4.8 4.6 4.1 3.8 3.5 Other S-H 39.1 39.5 39.7 40.8 41.4 42.2 Total Short Haul 53.9 54.0 53.2 54.5 53.7 55.0 2.0% 0.1% -1.3% 2% -2% 3% By Net Importers 26.7 26.1 25.7 26.0 26.0 26.8 1% -2% -1% 1% 0% 3% TOTAL 85.7 86.4 85.3 87.2 88.4 90.9 0.3% 0.9% -1.2% 2.2% 1.4% 2.8% * Note : Long Haul Gulf OPEC excludes short haul Iraqi exports. Source: IEA Stats. Total includes NGLs and processing gains Crude Exports (MBpd) 2007 2008 2009 2010 2011 2012(f) Middle East 15.2 15.8 14.8 15.7 17.3 17.3 (Long Haul) -2.3% 3.9% -6.5% 5.9% 10.3% -0.1% North Sea 3.1 2.7 2.7 2.5 2.1 2.0 -2% -12.5% 1.2% -8.6% -14% -5.4% Africa 7.0 7.1 6.7 6.8 5.8 6.7 2.0% 1.6% -5.3% 1.1% -14.3% 15.4% Caribs & L .Am 5.0 4.4 4.2 4.5 4.5 4.4 1.6% -13.2% -3.6% 6.1% 2.0% -2.3% FSU 1.0 1.4 1.9 3.4 3.5 4.0 23.8% 35.2% 37.0% 80.3% 3.5% 14.1% Short & Medium 23.0 22.4 21.2 21.7 19.4 20.1 Haul 2.8% -2.8% -5.3% 2.5% -10.9% 3.8% TOTAL 38.3 38.2 36.0 37.4 36.7 37.4 0.7% -0.1% -5.8% 3.9% -2.0% 2.0% Long Haul = exports over 5,000 miles from their main markets. Crude Imports (MBpd) 2007 2008 2009 2010 2011 2012(f) United States 8.1 7.8 7.1 7.2 6.7 6.2 -2.2% -3.8% -9.6% 2.4% -7.4% -7.1% EU Europe 9.9 10.1 9.2 9.2 8.8 8.5 -3.7% 1.8% -8.6% 0.3% -4.7% -3.8% Japan 4.2 4.2 3.7 3.7 3.7 3.8 -2.2% 0.3% -12.4% 1.0% -0.4% 3.7% Other Asia 11.4 11.6 12.3 13.1 13.3 14.6 3.8% 1.5% 6.6% 6.1% 2.0% 9.4% Others 4.7 4.6 3.7 4.2 4.1 4.3 12.0% -2.2% -18.4% 11.3% -0.7% 3.2% WORLD TOTAL 38.3 38.2 36.0 37.4 36.7 37.4 0.7% -0.1% -5.8% 3.9% -2.0% 2.0% Dwt Demand 250.4 253.0 234.9 250.8 248.5 252.8 Products Imports (MBpd) 2007 2008 2009 2010 2011 2012(f) United States 2.9 2.6 2.1 2.0 1.9 1.8 -5.6% -9.8% -17.3% -5.3% -4.3% -8.4% EU Europe 4.9 5.1 5.4 5.6 5.5 5.4 -3.2% 2.8% 5.8% 4.3% -2.6% -1.9% Japan 0.7 0.7 0.7 0.6 0.7 0.7 -1.0% -4.0% 1.6% -10.0% 10.8% 7.6% Other Asia 5.1 5.5 5.7 6.1 6.5 6.8 5.5% 8.3% 4.3% 6.8% 6.6% 4.9% Others 2.6 2.8 2.9 3.3 3.5 3.9 25.3% 8.3% 1.7% 13.6% 7.9% 9.9% WORLD TOTAL 16.2 16.7 16.8 17.6 18.1 18.6 2.9% 2.9% 0.9% 5.0% 2.8% 2.5% Dwt Demand 87.4 89.6 88.2 88.8 92.7 96.0 Source: Oil and Tanker Trades Outlook: Clarkson Research Services. Statistics derived from IEA data. f=forecasts. Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304 Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304

Clarkson Research Services Autumn 2012 21 SHIPPING MARKET OUTLOOK Figure 1.6.2 Figure 1.6.1 The Tanker Market • The tanker market has moved further into the red, having decreased by 6% over the last six months, with declines in all but the Aframaxes. Our swing-ometer now stands at –51% below trend, down from – 45% six months ago. • The decrease was largely due to the decline in spot earnings, with VLCC and Suezmax earnings falling by 29% and 25% respectively over the last six months. Only Aframaxes bucked the trend with improved spot earnings. • There was some optimism for the larger sizes in the better period rates and steady asset prices, but for Aframaxes and clean product tankers the trend for both was negative. Where are we in the Tanker Cycle ? Market 2002-11 Ship by Type Rate Average Market % diff. from Market % diff. from Indicator Value Rate Average Rate Average Spot ($/day) 55,839 22,592 -60% 6,140 -89% -29% Worse! 1 year t/c ($/day) 46,394 20,500 -56% 22,000 -53% 3% Bit Better 5 year old ($m) 95.6 63.0 -34% 63.0 -34% 0% Same VLCC Average -50% -59% -9% Bit Worse Spot ($/day) 47,628 17,065 -64% 5,208 -89% -25% Worse! 1 year t/c ($/day) 34,385 16,000 -53% 18,500 -46% 7% Bit Better 5 year old ($m) 65.6 44.5 -32% 45.0 -31% 1% Same Suezmax Average -50% -56% -6% Bit Worse Spot ($/day) 32,414 11,626 -64% 14,037 -57% 7% Bit Better 1 year t/c ($/day) 26,004 13,750 -47% 13,000 -50% -3% Bit Worse 5 year old ($m) 50.2 32.5 -35% 30.5 -39% -4% Bit Worse Aframax Average -49% -49% 0% Same Spot ($/day) 21,472 11,824 -45% 9,012 -58% -13% Worse 1 year t/c ($/day) 19,139 14,250 -26% 12,500 -35% -9% Bit Worse 5 year old ($m) 35.4 26.0 -27% 24.0 -32% -6% Bit Worse Clean Products Average -32% -42% -9% Bit Worse Tanker Average -45% -51% -6% Bit Worse VLCC Suezmax Aframax Clean Products (30k dwt) Mar' 12 Sep' 12 Last Six Months 0 10 20 30 40 50 60 70 80 0 10 20 30 40 50 60 70 80 90 100 Jan-72 Jan-73 Jan-74 Jan-75 Jan-76 Jan-77 Jan-78 Jan-79 Jan-80 Jan-81 Jan-82 Jan-83 Jan-84 Jan-85 Jan-86 Jan-87 Jan-88 Jan-89 Jan-90 Jan-91 Jan-92 Jan-93 Jan-94 Jan-95 Jan-96 Jan-97 Jan-98 Jan-99 Jan-00 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 $,000/d m dwt Source: Clarkson Research Services Crude Tanker Market Cycles Tanker Lay-Up VLCC 1 Year t/c Aframax 1 Year t/c VLCC/Aframax 280k/95k 350k/105k +120% -30% -90% -60% +30% +60% +90% 0 -120% Average Values, 2002-2011 Zap!! Depression Recession Soft Firm Boom Bonanza -51% Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304 Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304

SHIPPING MARKET OUTLOOK development has done little to alter the Tanker Year End Forecast generally unexciting demand outlook facing the Fleet 2008 2009 2010 2011 2012 2013 tanker industry,now that the United States is no VLCC 151.3 159.6 163.5 176.0 186.5 197.2 longer a principal source of import growth. 2.8% 5.5% 2.5% 7.6% 6.0% 5.7% Suezmax 54.5 59.1 63.0 68.5 73.0 77.1 1.1% 8.3% 6.6% 8.7% 6.6% 5.6% Tanker Supply Outlook Aframax 81.0 87.8 93.0 96.6 98.2 97.6 6.2% 8.4% 6.0% 3.8% 1.6% -0.6% The supply side of the tanker market looks less Panamax 26.0 27.4 28.2 29.4 30.2 30.5 icensed to The Hong challenging than the one faced by bulk carriers 9.1% 5.3% 3.0% 42% 2.8% 1.2% The tanker fleet grew by 5.8%in 2011 and we Handy 90.1 97.6 101.0 104.2 106.1 106.9 0R90R.30 350 3.1% 1.8% 0.R9% expect it to increase by around 4%in 2012. Total 402.9 431.4 448.8 474.6 494.0 5093 falling to 3%in 2013.Currently the orderbook %Change 5.4% 7.1% 4.0% 5.8% 4.1% 3.1% has fallen to 13.1%of the fleet,the lowest since Combos 2.6 3.5 4.5 4.3 3.7 3.6 June 2000.Tanker contracting during 2012 has Fleet 33% 50% 52% 57% 71% 76% Total 405.5 434.9453.2 478.9 497.6 512.9 been at a low level,with only 7.6m dwt ordered Fleet 5.7% 7.3%4.2% 5.7% 3.9% 3.1% in the first eight months of 2012.So although Kong Polytechnic University. trade growth is unexciting,it is close enough to Table 1.5 Tanker Fleet the supply growth trends to create possibilities. with only 9.9%of the fleet on order,down from The VLCC Market 11%in the spring.With deliveries of only 1.1m dwt expected for 2012,the fleet is likely to Di D The VLCC fleet is now 600 vessels of 183.3m grow by less than 2%per annum over the next dwt.The orderbook is 15.7%of the fleet,down two years.Again a welcome and encouraging from 21%six months ago,with deliveries of statistic. is restricted: 15.8m dwt expected in 2012.This will push the fleet up by around 6%which,bearing in mind The Handy Market(10-60,000 dwt) the sluggish demand and the cargo triangulation please opportunities from the Atlantic to Asia,is still The Handy fleet is a massive 3,342 ships of more than is needed to satisfy demand. 105.5m dwt,much the same as it was six months ago.The orderbook has edged up to The Suezmax Market 11.3%of the fleet,which is expected to grow by1.8%in2012and0.8%in2013. The Suezmax fleet is now 462 vessels of 71.4m dwt.The orderbook is 19.4%of the fleet and The Outlook for the Tanker Market acknowledge projections suggest that the fleet will grow by 6.6%in 2012 and 5.6%in 2013.Fairly brisk Six months ago we thought the tanker market growth against a sluggish demand scenario. an interesting prospect because,although the the source demand side was disappointing and demolition The Aframax Market prospects quite modest,the supply side was manageable.With demand growing at around The Aframax fleet now comprises 913 ships of 2%per annum and the fleet at 3-4%per annum, 97.4m dwt.The orderbook is now only 6.4%of the disconnect is not totally unmanageable the fleet,down from 9.4%in the spring,with (though not ideal).The surplus which has expected deliveries of only 5.5m dwt in 2012. accumulated over the last couple of years is still On that basis,with little scrapping,the Aframax of relatively modest proportions and oil is a fleet is set to grow by less than 2%in 2012 and seasonal cargo.At low levels of surplus to decline in 2013.An encouraging prospect for capacity,seasonal spikes are a normal feature of this workhorse vessel. the market.So the prospect for now is "steady as she goes"and the hope is that tankers do not The Panamax Market become the subject of too much speculative ordering.But with shipyards running out of http://www.clarksons.nel 01/11/2012 06:20:04 15304 The Panamax fleet follows a similar pattern to work,especially in China and Japan,that is Aframaxes.There are 416 vessels of 30m dwt. currently the greater risk. Clarkson Research Services 22 Autumn 2012

Clarkson Research Services 22 Autumn 2012 SHIPPING MARKET OUTLOOK development has done little to alter the generally unexciting demand outlook facing the tanker industry, now that the United States is no longer a principal source of import growth. Tanker Supply Outlook The supply side of the tanker market looks less challenging than the one faced by bulk carriers. The tanker fleet grew by 5.8% in 2011 and we expect it to increase by around 4% in 2012, falling to 3% in 2013. Currently the orderbook has fallen to 13.1% of the fleet, the lowest since June 2000. Tanker contracting during 2012 has been at a low level, with only 7.6m dwt ordered in the first eight months of 2012. So although trade growth is unexciting, it is close enough to the supply growth trends to create possibilities. The VLCC Market The VLCC fleet is now 600 vessels of 183.3m dwt. The orderbook is 15.7% of the fleet, down from 21% six months ago, with deliveries of 15.8m dwt expected in 2012. This will push the fleet up by around 6% which, bearing in mind the sluggish demand and the cargo triangulation opportunities from the Atlantic to Asia, is still more than is needed to satisfy demand. The Suezmax Market The Suezmax fleet is now 462 vessels of 71.4m dwt. The orderbook is 19.4% of the fleet and projections suggest that the fleet will grow by 6.6% in 2012 and 5.6% in 2013. Fairly brisk growth against a sluggish demand scenario. The Aframax Market The Aframax fleet now comprises 913 ships of 97.4m dwt. The orderbook is now only 6.4% of the fleet, down from 9.4% in the spring, with expected deliveries of only 5.5m dwt in 2012. On that basis, with little scrapping, the Aframax fleet is set to grow by less than 2% in 2012 and to decline in 2013. An encouraging prospect for this workhorse vessel. The Panamax Market The Panamax fleet follows a similar pattern to Aframaxes. There are 416 vessels of 30m dwt, with only 9.9% of the fleet on order, down from 11% in the spring. With deliveries of only 1.1m dwt expected for 2012, the fleet is likely to grow by less than 2% per annum over the next two years. Again a welcome and encouraging statistic. The Handy Market (10 - 60,000 dwt) The Handy fleet is a massive 3,342 ships of 105.5m dwt, much the same as it was six months ago. The orderbook has edged up to 11.3% of the fleet, which is expected to grow by 1.8% in 2012 and 0.8% in 2013. The Outlook for the Tanker Market Six months ago we thought the tanker market an interesting prospect because, although the demand side was disappointing and demolition prospects quite modest, the supply side was manageable. With demand growing at around 2% per annum and the fleet at 3-4% per annum, the disconnect is not totally unmanageable (though not ideal). The surplus which has accumulated over the last couple of years is still of relatively modest proportions and oil is a seasonal cargo. At low levels of surplus capacity, seasonal spikes are a normal feature of the market. So the prospect for now is “steady as she goes” and the hope is that tankers do not become the subject of too much speculative ordering. But with shipyards running out of work, especially in China and Japan, that is currently the greater risk. Table 1.5 Tanker Fleet Year End Forecast 2008 2009 2010 2011 2012 2013 VLCC 151.3 159.6 163.5 176.0 186.5 197.2 2.8% 5.5% 2.5% 7.6% 6.0% 5.7% Suezmax 54.5 59.1 63.0 68.5 73.0 77.1 1.1% 8.3% 6.6% 8.7% 6.6% 5.6% Aframax 81.0 87.8 93.0 96.6 98.2 97.6 6.2% 8.4% 6.0% 3.8% 1.6% -0.6% Panamax 26.0 27.4 28.2 29.4 30.2 30.5 9.1% 5.3% 3.0% 4.2% 2.8% 1.2% Handy 90.1 97.6 101.0 104.2 106.1 106.9 10.8% 8.3% 3.5% 3.1% 1.8% 0.8% Total 402.9 431.4 448.8 474.6 494.0 509.3 % Change 5.4% 7.1% 4.0% 5.8% 4.1% 3.1% Combos 2.6 3.5 4.5 4.3 3.7 3.6 % Fleet 33% 50% 52% 57% 71% 76% 405.5 434.9 453.2 478.9 497.6 512.9 5.7% 7.3% 4.2% 5.7% 3.9% 3.1% Total Fleet Tanker Fleet Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304 Licensed to The Hong Kong Polytechnic University. Distribution is restricted; please remember to acknowledge the source. http://www.clarksons.net 01/11/2012 06:20:04 15304