1. Göteborg 25 November, 2009 Lloyd’s Register-Fairplay and IHS General Overview 2009 2010-2014 Presented by: Christopher Pålsson Manager & Senior Consultant Lloyd’s Register-Fairplay Research

3. What We All “Know” …. Net fleet growth exceeds demand in most shipping sectors Downwards pressure on ship charter rates — Non-operative ship owners in distress Downwards pressure on shipping rates, but… — Upwards correction to sustainable levels expected — Short lived temporary spikes likely No tonnage shortage, but… — Changing market structures – M&A

4. LRF Port Activity Indicator

5. World fleet development

6. New vessel deliveries

7. Vessel removals

8. Cancellations – no of vessels

9. Cancellations – % of orderbook

10. Total world fleet development 6.6% pa 2004-2008

11. Total world fleet development 6.8% forecast 2009-2013

12. New vessel ordering by month

13. And it is in China it is happening

14. Capacity supply absorption Changing trade patterns New networks/routes Sourcing of cargo further away Slow steaming & rerouting Savings; bunker fuel & canal charges Storage Removals (scrapped & lost) Already included in fleet forecast Conversion Idle Warm or cold lay-up Maintenance & repairs Queing outside ports

15. Why buy a new ship now? Price Spec Lowest cost position Delivery time Employment & Speculation The Godmother!

16. New ship ordering – dwt

17. New ship ordering – no of vessels

19. North & Baltic Sea region Present in ECA >49.9% 2009 >1,999dwt On order for group owners with vessels present in ECA >49.9% 2009 >1,999dwt Excl unknown/unidentified owners

20. Business Implications and the Bottom Line Cargo Owners/Shippers Generally low transport costs, but “nervous” rates Unstable market conditions Changing market organization Treasure reliability! Ship Owners & Operators Very tough competition Difficult financing Newbuilding exposure? Lowest cost per unit Survival of the wealthiest

21. Tack! Christopher Pålsson, Lloyd’s Register-Fairplay Research, research@lrfairplay.com