1. Shipping Industry and market developments 2nd International meeting on ironmaking 1st International symposium on iron ore Vitòria ES 12-15 September 2004

2. Market reached unprecedented peaks

3. What caused the freight rise?

4. Fleet growth 2003 deliveries lowest for 10 years

5. Dalrymple bay 28 vsls 26 due to arrive nxt 9 days Port delays

6. …iron ore demand strong Short term outlook: steel prices high…

7. Note: crop season runs Oct-Sept Substantial soybean growth in 2004/05

8. Forecast 30mt growth in 2005-06 Long term outlook: Cape market follows iron ore trade

9. Price gap too narrow for long haul Coal prices over the peak Long haul trade takes off Long haul trade disappears

10. Newbuildings not excessive by historical standards

11. but zero scrapping means fleet is growing fast

12. 4 consecutive months of decline Peak in Industrial production growth Jul/Aug If continued,negative for freight market for end 2005 & 2006 OECD lead indicators decline

13. Generally bullish for Q4 2004 and 1 st half 2005 Steel market very strong Chinese ore demand recovered after blip Growth in Soybean trade Nuclear power stations in Japan to shut down Port congestion increasing. Conclusions

14. Risks for 2005 –OECD economic slowdown –Slower growth in Chinese ore imports –Fleet expanding fast due to lack of scrapping –Expect correction in freight market by mid 2005 Long term (1 to 5 years) –Contract rates to stay well above historic averages

15. General comment The rules of the game seem to have permanently changed Is India the next China? As long as the chinese banking system does not collapse, their high pace of growth should be maintained.

16. Market reached unprecedented peaks

17. (520) (508) (452) (477) (432) (422) (428) (427) (425) (426) (419) (401) (361) (372) (363) (304) Risks of freight exposure are now much greater Freight volatility has increased

18. Traditional shipping industry Vessel’s cost lower then coa’s revenue Cargo combinations were the sole tool for improvement Derivatives market non existing or with very little liquidity. Limited volatility

19. The new shipping industry Shipping is traded as a commodity Very large use of derivatives for hedging and speculation. FFA market with extreme liquidity Very high exposure due to market fluctuations and counterparty risk.

20. High critical mass and financially strong Defines clear medium to long term market views, and behaves accordingly. Plays the short term volatility by going short, or long, very quickly Provides top quality service and flexibility to its clients The modern shipping company

21. The modern charterer Carefully select his counterparts. Reaches optimum operation management. Starts opening to FFA trade for hedging purposes.