S & P 

The capesize M/V GAIA (169,963 dwt 1999 blt Daewoo) reported sold to Greek interests at US$ 15.4m. On other sales, it is understood that M/V AMBER K (48,282 dwt 2000 blt Oshima) is closely to be committed to undisclosed Greek interests for region US$ 13.5m. Korean buyers have purchased M/V OCEAN BELLE (32,130 dwt 1999 blt Saiki) for US$ 9.8m. Owners originally intended to sell the vessel including 2 years time charter back, but finally sold her on a time charter free basis.

A quiet week in the Tanker S+P market - again more down to a dearth of realistic sales candidates than active enquiry.

So far in 2012 we have seen the total orderbook decline by 19 percent in terms of dwt compared to the size of the orderbook at the end of 2011, notably the dry bulk sector still accounts for 56.6% of the total number of ships on order. This is therefore perhaps an unsurprising statistic, given that the Baltic Dry Index has been under so much pressure for most of 2012, dropping 46% Q-o-Q during the first quarter and in spite of a slight gain during the second quarter, year-on-year the BDI is still down by 31%. Add to this an orderbook overhang from the boom period, a world economic slowdown and a softening in commodity demand and it is no surprise that freight rates have struggled to gain any ground to date. Although we have seen a record number of drybulk ships scrapped, the average size of older ships is smaller than new deliveries and the net growth in the fleet far outweighs the demand for deadweight and therefore the pressure on freight rates continues.

In the first half of 2012 earnings in the crude sector have in part been supported by rising OPEC production (returning to levels not seen since 2008), record imports into China and India and increased long-haul trade both from the Arabian Gulf to the United States and from the Atlantic Basin to Asia. However, heavy deliveries from the boom years still continue to weigh on the market in 2012 and probably into 2013, although we are expecting to see some positive signs that we will start to see some deceleration in fleet growth going into 2013.

The difficulty yards face for the remainder of the year, is that the price to earnings ratio has increased to historically high multiples and therefore Yards will need to continue to find ways to further incentivise Owners to order in the 2nd half of 2012, whether that is through pushing new eco designs, financing or further finding ways to cut pricing remains to be seen.

In terms of new business, Clients of Zodiac Maritime have placed an order for ten wide-beamed 5,000 TEU Vessels at STX Dalian. Delivery will be from July 2014 and the price is understood to be around USD 43 Mill. Also in containers Shanghai Jinjiang Shipping Corp have placed an order for four plus four CV1,100 types at a price we believe to be just over USD 17 Mill for these geared units and they will be built at Jiangnan Changxing Heavy Industries. In the multi-purpose sector, Samsung Heavy Industries blockbuilding facility in Ningbo have entered the Shipbuilding market now, with an order from S&P Marine of Korea for a single 17,000 dwt heavy lift transporter. No price is known as yet, but the Vessel is due to deliver in July 2013.

In drybulk, Sincere Navigation have inked two plus two 82,000 dwt Kamsarmaxes at SWS in China for delivery from June 2014 and we understand the price to be USD 27.5 Mill. Clients of Oldendorff Carriers have placed an order for two 36,000 dwt handysize bulkers at Wehai Samjin, for delivery in the 2H 2012, no pricing is know yet for this order. In the smaller handy sector, Seaboard Marine have ordered four option four of the Delta Marine designed 28,000 dwt handies for USD 21.25 Mill per Vessel, delivery for these will be from January 2014.

Finally in LNG, Clients of Alpha Tankers and Freighters have exercised their option for a second 160,000 cbm LNG carrier at STX in Korea and Clients of MOSK have placed an order for a singleton LNG carrier at their domestic Yard Mitsubishi Heavy Industries. The deliveries for these vessels will be March 2015 and November 2014 respectively.