1. INTERCARGO International Association of Dry Cargo Shipowners Bulk Carrier Issues Mr Rob Lomas January 2008

2. INTERCARGO Topics for analysis Dry Bulk sector statistics Port State Control performance Conclusion – are owners and charterers ignoring safety and quality?

3. Dry Bulk Association About 800 dry bulk vessels 135 members – Asia and Europe Member : Round Table of Maritime Associations - BIMCO, International Chamber of Shipping; Intercargo and Intertanko Common challenges – quality, safety, responses to regulation

4. INTERCARGO Bulk Carriers – setting the context. Larger fleet 1/1/2007 - 6,084 1/1/2008 – 6,343 2012 – 7,700 ?? Casualties 2006 – 7 ships : 37 lives 2007 – 7 ships : 39 lives 2008 - concerns about China charterer quality Negative Performance Indicators Collisions : + 70 % 2006 ? Groundings : +17% on 2006 ? Engine Problems : - 14% on 2006 ?

5. INTERCARGO UNCTAD : Review of Maritime Transport 2007 In 2006, world seaborne trade (goods loaded) increased by 4.3 per cent to reach 7.4 billion tons At the beginning of 2007, the world fleet broke the 1 billion deadweight tons (dwt) barrier Dry Bulk fleet grew 8% China, India and Asia – clearly leading the trades

6. INTERCARGO PORT STATE CONTROL One of the mechanisms to regulate global shipping Transparent (through www.equasis.org), effective and (usually) honest and professionalwww.equasis.org Can be used to measure quality (owners, flag and class) : Detentions and Deficiencies per Inspection (DPI)

7. INTERCARGO 1 January 2008 : Bulk Carrier results Measurement in the Paris MoU, Tokyo MoU and US Coast Guard Areas of Bulk Carrier performance (10,000+ dwt) 2007 – 470 detentions 2007 Intercargo entered vessels - 23 (2006:26, 2005:34; 2004:43; 2003:30)

8. INTERCARGO Detentions – main factors Fire fighting 1 st (598) ISM/Certificates 2 nd (539) Lifeboats 3 rd (425) 10 other categories – serious structural – (149) Increasing concern in 2007 and 2008 that vessel maintenance standards are becoming challenging

9. INTERCARGO Benchmarking – Owner quality and performance Not only BAD owners which have collisions and groundings but also the GOOD Collisions 2005 : “A” and B+ owner had 61% of the collisions but comprised 39% of total. Groundings 2005 : ditto 54% / 39 % Inference : training; ISM; and…Human Element

10. INTERCARGO Environmental issues Pressure to “do something” – voters & pressure groups; … and shipowners : INTERMEPA, & self interest; Regional verses International – owners’ preference towards International; Charterer’s transparency leading to new pressures

11. INTERCARGO - Environmental summary CO2, SoX, NoX & PM Ballast Water / Anti Fouling Cargo residues End of life – recycling, Pollution in general

12. INTERCARGO 2008 Work Programme (General) Focused on key issues, which have a bulk perspective

13. INTERCARGO Work programme (1 : Specific) Air Emissions - wants a pragmatic & technically feasible solution to the bunker/air emissions debate taking into account safety. Common Structural Rules & Goal Based Standards –Technical solutions and harmonised international standards. Casualties/Transparency of reporting – Wants a rethink in the way that Flag reports class. Criminalisation – Intercargo supports the Coalition opposing the European Union's criminalisation of seafarers for accidental pollution. Definition of Bulk Carrier – wants safety consideration for Open Hatch General Cargo ships

14. INTERCARGO Work programme (2) Environmental legislation – holistic and “net environmental gain” must be the goal. Lifeboats – working with Intertanko to improve safe systems of evacuation. Loading Rates – work with Classification Societies on very high loading rates on large bulk carriers (Brazil – China/Japan) Pooling –September 2007 European Commission Guidelines on Competition Law changes

15. INTERCARGO Work Programme (3) Port State Control: Performance and Corruption : not a single Bulk Carrier industry in terms of performance Reception facilities – challenging anomalies of Marpol V and the availability of reception facilities for receiving dry cargo residues. Stowaways – Intercargo/Intertanko, with the support of Round Table partners, lobbied IMO for a Stowaway Focal Point to assist P&I and Flag Training and Manpower – committed to a safe and effective work-force

16. INTERCARGO Summary : Main Dry Bulk external issues Regulation – quantity & effectiveness : especially environmental Safety – Bulk Carrier design and Human Element Supply chain responsibility for quality & international development Training & employment Commercial – supply & demand; Third party ship management; consolidation

17. INTERCARGO INTERNATIONAL ASSOCIATION OF DRY CARGO SHIPOWNERS Thank you for your attention www.intercargo.org info@intercargo.org www.shippingfacts.org