WEEKLY MARKET REPORT January 18th, 2008 / Week 3

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1 TELEPHONE: ONE EXECUTIVE DRIVE TELEFAX: FORT LEE, NEW JERSEY WEEKLY MARKET REPORT January 18th, 2008 / Week 3 There has been little activity in the Sale & Purchase market in terms of inquiries, inspections and concluded transactions to report for this week. "Wait and see" has become the sale-and-purchase mantra for both buyers and sellers as the Baltic Dry Index (BDI) continued to plunge and tanker rates continued on their softening trend. After 6-8 months of soaring dry cargo rates and massive cash infusions into owners coffers, the pendulum has swung in the opposite direction. On Thursday, the BDI plunged by its largest one-day fall (443 points) since its inception in 1985, breaking the record set a day earlier (421 points down)! The BDI had four record one-day declines this week and fell to 6,472, a drop of about 19% this week alone, 29% year-to-date, and 50.52% since the peak closing of 11,039 on November 13th, The Cape market, admittedly the most volatile sector in the dry bulk universe, as indexed by the BCI, saw a 28% drop this week, 43% drop y-t-d, and 52% since peaking on November 15th at 16,256. However, let's not lose sight of reality, as rates are still at extremely good levels on a comparative basis: Capesize vessels still make US$ 83, 000 per diem on the spot market, Panamax bulk carriers about US$54,000 pd and VLCC tankers more than US$ 50,000 pd on average. A few years ago, such numbers would have been called 'wishful thinking'. The present precipitous drop does not necessarily presage bad things: for starters, the market had plenty of 'froth' and excesses, and a correction was in the cards for a while. Also, let's do not forget that the Chinese New Year is soon upon us; an additional factor, at least of the Cape and possibly Panamax markets, iron ore price negotiations are at full swing and there is not much incentive to buy cargo on the spot market. It was not a bad week only in the freight markets; equity markets have also seen precipitous declines on fears of a US-led recession and possibly worldwide slowdown. Shipping equities have seen their share prices decline much more than broad equity averages, and certain stocks are trading at a fraction of their highs. Remembering the recent passing of Sir Edmund Hillary, recent declines look like descending from the Summit! Record highs have been established only to be broken again and again! TANKERS: ANTIGONI 81,282/82 - OSHIMA - SUL 17,000 - COILED - COATED - IGS - SBT - COW - DS Sold for $12 mill. to Chinese buyer. COMPASS MARITIME SERVICES, LLC * FORT LEE, NJ * USA Page 1

2 JAG ARPAN 64,000/86 - HYUNDAI - B&W 11,280 - COATED - COILED - SBT - IGS - DS Sold for $15 mill. to undisclosed buyer. ISMINI 62,278/83 - MITSUI - B&W 15,200 - COATED - COILED - SBT - IGS - DS Sold for $10 mill. to Chinese buyer. MERIOM ROSE / MERIOM SKY 38,500/07/06 - GUANGZHOU - MAN/B&W 12,889 - COILED - SBT - IGS - DH Sold for $45.5 mill. each to German buyer. Sale includes existing bb charter for 3 years at $14,800/day. JO CLIPPER / JO LIND 33,549/81/82 - NORWAY - B&W 13,100 - COATED - COILED - IGS - IMO 2/3-9,140 LDT - DB Sold for $30 mill. en bloc to Indian buyer (West Asian Marine). A. PROLOGUE 29,999/85 - GREECE - B&W 12,000 - COATED - COILED - IGS - SBT - SH Sold for $6.8 mill. to Chinese buyer. BULKERS: FORTUNE PEARL 45,585/96 - HASHIHAMA - B&W 9,750-5HH - C 4X30T Sold for $58 mill. to undisclosed buyer. Sale includes t/c until 8/2008 at $12,000/day. AVENIR 42,842/85 - MITSUBISHI - SUL 7,964-5HH TEU - C 4X25T - GRABS - 8,782 LDT Sold for $25.5 mill. to undisclosed buyer. Sale includes t/c until 8/2009 at $22,500/day. LONG XING 42,123/71 - GERMANY - FIAT 13,495-7HH - D 14X10T - 6,832 LDT Sold for $5.5 mill. to Taiwanese buyer. ESER KAPTANOGLU 37,227/82 - HYUNDAI - B&W 10,900-5HH TEU - C 4X250T - 8,476 LDT Sold for $24 mill. to undisclosed buyer. THORSEGGEN 18,567/83 - U.K. - SUL 6,730-6HH OPEN/BOXED - C 2X25T GANTRY - 4,641 LDT Sold for $13 mill. to Italian buyer. SIR JACOB 10,106/97 - SHIN KURUSHIMA - B&W 5,280-3HH - C 2X25T, D 1X25T Sold for $16.35 mill. to Turkish buyer. WALSERTAL 6,900/95 - RUSSIA - B&W 5,015-1HH TEU - GLESS Sold for Euro 7 mill. to undisclosed buyer. ABDULLAH MUHIEDDIN 6,654/82 - TAIHEI - MIT 3,900-3HH - D 4X15T - 1,990 LDT Sold for $3 mill. to Syrian buyer. CONTAINERS: APL JEBEL ALI 33,817/02 - GERMANY - SUL 29,311-7HHA - 2,470 TEU - C 3X45T Sold for $58 mill. to Greek buyer (Allocean). COMPASS MARITIME SERVICES, LLC * FORT LEE, NJ * USA Page 2

3 HYUNDAI BRIDGE / HYUNDAI PROGRESS / HYUNDAI HIGHWAY 24,700/98 - HYUNDAI - B&W 26,740-7HH - 2,181 TEU Sold for $30 mill. each to Greek buyer (Danaos). Sale includes a 10 year t/c back at undisclosed rate. CMA CGM IPANEMA 23,051/01 - POLAND - SUL 18,109-4HO/9HA - 1,730 TEU - C 3X40T Sold for $33.8 mill. to Greek buyer (Varship). Sale includes t/c until 4/2008 at $13,000/day. TRINITY BAY 13,760/08 - KOUAN - MAN/B&W 13,228-2HH - 1,118 TEU - C 2X45T Sold for $29.2 mill. to undisclosed buyer. TWEENDECKERS: HARI BHUM 7,754/81 - GERMANY - MIT 6,000-2HH TEU - C 2X35T Sold for $4 mill. to Indonesian buyer. EASTERN FORTIS 7,025/89 - HIGAKI - HAN 3,300-2HH - D 1X30T Sold for $7.2 mill. to Korean buyer. THOR SIMBA 5,900/84 - GERMANY - MAK 4,690-1HH TEU - C 2X80T Sold for $6 mill. to Russian buyer. NEW SHIPS FOR SALE: BULKERS PACIFIC TRADER 45,578/00 - TSUNEISHI CEBU - B&W 9,750-5HH - C 4X30T Part loading Vancouver between 26th 29th January, then Kalama to complete loading between 29th 30th January for discharge in Manila (between 18th 20th February) and completing discharging in Davao (between 22nd 24th February). ANGEL III 43,665/89 - TSUNEISHI - B&W 9,680-5HH 1,082 TEU - C 4X30T Loading Kwangyang, January 19-20th, Kaohsiung, January 23-25th, Pasir Gudang, January 30-31th. LORD BYRON 25,694/85 - IMABARI - B&W 6,400-4HH - C 3X25T, D 1X25T Vessel eta Kandla, India 21st January where can be inspectable. TANKERS: GULF GRACE 65,017/00 - DAEWOO - SUL 14,438 - COILED - COATED - IGS - SBT - COW - DH Vessel eta Singapore 21st January for bunkers. Then will proceed to Taiwan-Japan range to discharge. LPG GAS PRUNUS 3,785/92 - MURAKAMI - B&W 3,040-3,313 CBM Inspectable at Sanwa Dock, Hiroshima around 26 January. COMPASS MARITIME SERVICES, LLC * FORT LEE, NJ * USA Page 3

4 NEWBUILDINGS NEWBUILDING STATISTICS TYPE OF SHIP * TOTAL ORDERBOOK ULCC/VLCC (+2) SUEZMAX (+2) AFRAMAX (+2) PANAMAX (+3) MR (-15) 0-35,000 DWT (-10) CAPESIZE (+2) ,000 DWT (-24) PANAMAX (-22) SUPRAMAX (+3) HANDYSIZE * Includes ALL vessels on order NEWBUILDING CONTRACTS No. Size Type Yard Delivery Price (mill) Owners Comm. 4 x 50,000 dwt Chem Hyundai Mipo 2011 $50.3 Asian 2 x 50,000 dwt Chem Hyundai Mipo 2011 $50.3 European 10 x 13,000 dwt Chem 21 st Century 2010/11 $26 Rigel Schiffahrts 8 x 6,300 dwt Prod Zhenjiang 2009 N.G. Livanos 4 x 160,000 cbm LNG Samsung 2011/12 Angola LNG 2 x 147,000 cbm LNG 2011 Brunei Shell Tankers 4 x 92,500 dwt Bulk Yangfan 2009/10 NSC Schiffahrt 4 x 92,500 dwt Bulk Yangfan 2009/10 Xin Haixing 1 x 59,000 dwt Bulk S. Korea 2011 Aegean Bulk 2 x 34,000 dwt Bulk 21 st Century 2012 $35 N. Moundreas 2 x 34,000 dwt Bulk 21 st Century 2012 $35 Kirgen 5 x 6,600 Teu Cont CSBC 2012 $97 Yang Ming 2 x 5,100 Teu Cont Jiangnan Changxing 2010 Reederei 5 x 4,500 Teu Cont CSBC 2011/12 $75 Yang Ming 2 x 950 Teu Cont Daesun 2011 $24.4 Regional Container COMPASS MARITIME SERVICES, LLC * FORT LEE, NJ * USA Page 4

5 KEY INDICATORS INDICES RATE OF EXCHANGE BALTIC EXCHANGE RATES THIS WEEK LAST WEEK CHANGE $ / Won: Baltic Dry Index $ / Nok: Baltic Capesize Euro / $: Baltic Panamax Stlg / $: Baltic Supramax $ / Yen: Baltic Handysize LIBOR (3-mos) / 3.93% Crude - WTI $90.13 $ $3.58 3,500 3,000 2,500 2,000 1,500 1, Jan Jul Jan-05 BALTIC TANKER INDICES 02-Jul Jan Jul-06 BDTI INDEX BCTI INDEX 02-Jan Jul Jan-08 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 2, Jun O ct Feb-05 ESTIMATED VALUES BALTIC DRY INDICES BDI BCI BPI BSI 01-Jun O ct Feb Jun O ct Feb Jun O ct-07 TANKERS NB PROMPT 12 MONTH 5 YEARS 10 YEARS 20 YEARS RESALE T/C VLCC 300,000 dwt $141.0m $145.0m $133.0m $108m (DH) $38.0m (SH) $65,000 PD Suezmax 150,000 dwt $88.0m $105.0m $96.0m $76.0m (DH) $30.0m $45,000 PD Aframax 105,000 dwt $69.0m $78.0m $69.0m $56.0m (DH) $17.0m (SH) $30,000 PD Panamax 70,000 dwt $63.0m $67.0m $60.0m $48.0m (DH) $14.0m $26,500 PD Product 47,000 dwt $52. 0m $60.0m $52.0m $43.0m (DH) $13.0m $23,000 PD BULK CARRIERS Capesize 170,000 dwt $94.0m $165.0m $148.0m $110.0m $60.0m $120,000 PD Panamax 74,000 dwt $52.0m $103.0m $89.0m $77.0m $44.0m $65,000 PD Supramax 52,000 dwt $45.0m $85.0m $75.0m $61.0m $39.0m $55,000 PD BUNKER PRICES FUEL GRADES ROTTERDAM FUJAIRAH PIRAEUS SINGAPORE 380cst: $ $ $ $ cst: $ $ $ $ MGO: $ $ $ $ COMPASS MARITIME SERVICES, LLC * FORT LEE, NJ * USA Page 5

6 DEMOLITION DEMOLITION STATISTICS TYPE OF SHIP THIS DATE 2008 THIS DATE TOTAL 2006 TOTAL ULCC/VLCC SUEZMAX AFRAMAX PANAMAX TANKER CAPE/COMBO (100,000 dwt +) PANAMAX BULKER ESTIMATED DEMOLITION PRICES LOCATION TANKERS 6-10,000 LT TANKERS 15-20,000 LT BULK CARRIERS CHINA SUB-CONTINENT DEMOLITION: BANGLADESH M/V RAYCHIKHINSK (tween) 6,048/67-3,285 LDT - USD /LDT COMPASS MARITIME SERVICES, LLC * FORT LEE, NJ * USA Page 6

7 COMPASS CONTACTS SALE & PURCHASE MOBILE PHONE NUMBER AOH Terry Chance Bart Lawrence Tom Linter Tom O Toole Tom Roberts Sophus Schanche PROJECTS & FINANCE Basil Karatzas ADMINISTRATION Joseph Kaufmann Very Truly Yours, COMPASS MARITIME SERVICES, LLC The information contained in this report has been obtained from various market sources. COMPASS MARITIME SERVICES (CMS) believes such information to be factual and reliable without making guarantees regarding its accuracy or completeness. CMS will not be held responsible for any action or failure to take action upon reliance on information contained in this report COMPASS MARITIME SERVICES, LLC All Rights Reserved COMPASS MARITIME SERVICES, LLC * FORT LEE, NJ * USA Page 7