S & P 

Regardless of the traditionally quiet Christmas and New Year period there has still be a number of sales concluded.

TORM have sold two resale Kamsarmaxes (82,000 dwt) TORM KAMMA and TORM KATRINA vessels reportedly to clients of Efnav of Greece. The ships are on order at Tsuneishi Zhoushan and due for delivery late 2012 and early 2013. The price is understood to be in the region of $32-33m on a novated contract basis.

On the Panamaxes, the M/V PEPITO (75,928 dwt 2001 blt Kanasashi) reported sold to the vessel¡¯s current timecharterers COSCO, Dalian to whom the vessel was fixed for 5 years in 2008 at US$ 41,750 per day. We understand that the Charterers have purchased the Vessel in a deal that would no doubt involve some form of compensation to the sellers in lieu of cancelling the well above market timecharter. Price said to be in the region of US$ 20m.

Japanese controlled logs-fitted handysize M/V LAVIEEN ROSE (31,824 dwt 2000 blt Hakodate) is reported to have been sold at US$ 15.8m to European interests.

In the tanker S+P market, most will be welcoming the start of 2012 and will certainly be hoping that this year is not a repeat of the last where a lack of credible financing and dire charter rates across the crude sectors lead to continued downward pressure on values, which accelerated from Q2 onwards.

Relative to the crude sector, the products marked faired a little better and asset values remained more stable. There is further evidence of this relative stability in the first sale of the year (albeit subject to Buyers Board Approval). The IMO II/III, MR Tanker M/T MARE DI NAPOLI (51,371 dwt 2007 blt SLS) has been sold on Buyers' subjects to a US based investment Co at US$ 27.5m.

Monaco based Seaworld Management has agreed to purchase IMO III M/T FABRIZIA D¡¯AMATO (40,081 dwt 2004 blt Shina) for US$ 19.2m.

Sanko has sold two stainless steel chemical tankers, M/T SANKO NEPTUNE and M/T SANKO NOBLE (19,991 dwt 2011 blt Fukuoka) to Zodiac for US$ 27m each.

DEMOLITION 

The year has begun very positively with news that Bangladesh is on the verge of re-opening and on the back of a stable currency and improved steel prices domestically, India increasing their price indications and Chinese breakers continuing their aggressive stance from last year.

However, on paper everything looks rosy, but an air of caution is still to be adopted as currently, Bangladesh remains closed until the hearing due next Thursday 12th, and Indian rates are on the rise but only because some cash intermediaries appear to be speculating on the re opening of the© Bangladeshi market and as such, the current improved rates seen for tonnage basis delivery India are not being justified on the waterfront at Alang.

The concern for most is the tremendous amount of tonnage being proposed to the market since the turn of the year and whether the current firm rates can hold. Many parties believe that when Bangladesh officially re-opens the rates will increase substantially in excess of the USD 500/ldt level, however this is again pure speculation and if the amount of new tonnage witnessed in the market over the last few days is anything to go by, then the conveyor belt of tonnage supply may affect the breakers mentality in the near future even if Bangladesh does re-open next week as predicted.

NEWBUILDING  

It is well known that the second half of 2011 saw not only a decline in the number of new orders being placed but also in the firm enquiries and discussion being held with the yards. As such, it is perhaps unsurprising that the beginning of 2012 has begun in a relatively similar vein. We have seen some reports of new business being concluded but for the most the market remains relatively quiet, with the yards having little time to gear up their marketing drives between the return of the West from its recently concluded holiday period and the upcoming Lunar New Year holidays in the Far East towards the end of this month.

Much of the news this week has centred about the announcements by the major Korean Yards of their targets for 2012. Most of the yards have set fairly firm yearly targets, with HHI (USD 23.8 Bln up 19% from 2011), Samsung (USD 12.6 Bln up 8.7% on 2011) and STX (USD 15.0 Bln up 17% on 2011) in particular leading the pack. With many of the more conventional sectors continuing to look relatively challenging for owners over the upcoming months, it remains likely, the yards will be looking to target the higher value sectors such as Offshore and the like. This seems to follow a similar pattern to the

strategies of last year and it will be interesting to see given the successful ordering in 2011 in these sectors whether there is a similar level of demand to sustain these latest targets.

Whilst China was successful in winning a certain volume of business last year, due to the sheer size of structural capacity within China today there remain many yards that still have potential early berths within 2013. With demand likely to remain remaining limited in the short term and against this backdrop of excess supply, there may well have to be a continued adjustment in pricing in order for the yards to be able to push on and drive further ordering.

In terms of reported business; In Dry, it has been reported that Universal Shipbuilding have won an order for 1 x 209,000dwt Capesize Bulk Carrier from Mitsui O.S.K.Lines and this vessel is provisionally scheduled to deliver in 2014. No pricing has been disclosed; however we understand the Vessel has been ordered against long term charter business with a domestic steel mill.

In Tankers, it was announced just before the turn of the New Year that Scorpio Tankers have declared and signed one of their optional 52K MR product tankers at a price of USD 36.4 Mill. This was an option they had held since their original order placed in 2011 and this latest vessel is expected to deliver in January 2013. They still hold a further 3 options, with the first of these to be declared within the middle of January 2012.