Chemf 2007 3

Chemical Forecaster 3Q07
Quarterly Forecasts of the Chemical Shipping Market
Analytical Team:
Ashita Khanna
Editor
E-mail: khanna@drewry.co.uk
Capt Ken Tree

Associate
E-mail: tree@drewry.co.uk
Charles Barton
Associate
E-mail: barton@drewry.co.uk
Serena Wang
Associate
E-mail: wang@drewry.co.uk
Publisher:
Nigel Gardiner
E-mail: gardiner@drewry.co.uk
Order No: 16711. This copy is licensed to United Arab Shipping Co. S.A.G REDISTRIBUTION IS PROHIBITED.
Drewry Shipping Consultants Ltd,
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213 Marsh Wall, London E14 9FJ
United Kingdom
www.drewry.co.uk
Tel: +44 (0)20 7538 0191 Fax: +44 (0)20 7987 9396
E-mail: enquiries@drewry.co.uk
© Drewry Shipping Consultants Ltd 2007
ISSN 1748-1163
Copyright 2007. This report is for the sole use of the purchaser and is not to be copied or distributed outside of this organisation.
Reproduction, scanning into an electronic retrieval system, or copying to a database is strictly prohibited without written permission
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Drewry Shipping Consultants Ltd.
While information is presented in good faith, the publisher cannot accept liability for errors of fact or opinion.
3Q2007
chemical forecaster contents
Contents
1. Market summary 01
Deep sea market 02
Regional trades 03
Veg oils/animal fats market 04
2. Economy and trade 07

2.1 Global economy: recovery in 2009 07
2.2 Organic chemicals 09
2.2.1 Exports 09
2.2.2 Imports 13
2.3 Inorganic chemicals 18
2.3.1 Exports 18
2.3.2 Imports 19
2.4 Seaborne trade 20
2.4.1 Total trade 20
Chemical forecaster
2.4.2 Organic trade 23

2.4.3 Inorganic trade 23
2.4.4 Veg oils/animal fats 23
3. Chemical tanker shipping 27

3.1 Chemical tanker demand 27
3.2 Chemical tanker supply 28
3.3 Future supply 40
3.4 Supply/demand balance 41
3.5 Freight markets 41
3.6 Newbuilding 47
3.7 Secondhand 47
3.8 Demolition 48
4. Freight markets 51
4.1 Major deep sea trade legs 51
4.2 Transatlantic eastbound 51
4.3 Transatlantic westbound 52
4.4 Transpacific westbound 53
4.5 Middle East Gulf to North West Europe and Mediterranean 54
4.6 Northwest Europe to India/S.E. Asia and Far East 56
4.7 US Gulf to South America 56
4.8 US Gulf to the Mediterranean and return 57
4.9 Far East to Europe and USA 58
4.10 Regional markets 58
© Drewry Shipping Consultants Ltd i

3Q2007
4.10.1 Middle East Gulf 59

4.10.2 Europe 63
4.10.3 Asia 64
5. Veg oils, fats and molasses market 65

5.1 Oils fats and molasses freight markets 65
5.1.1 Ocean trade lanes summary 67
5.1.2 Regional trade lane summary 68
5.2 Production/exports 68
5.2.1 Malaysia 69
5.2.2 Indonesia 71
5.2.3 Brazil 73
5.2.4 Argentina 75
5.3 Production and demand 77
5.3.1 EU-25 77
5.3.2 China 80
Chemical forecaster
5.3.3 Indian Ocean 82

5.3.4 USA 82
5.4 Product markets 83
5.4.1 Palm oil 83
5.4.2 Lauric oils 83
5.4.3 Soya oil 85
5.4.4 Sunflower oil 85
5.4.5 Rapeseed oil 87
5.4.6 Fish oil 87
5.4.7 Tallow and other fats 87
5.5 Others 89
5.5.1 Urea Ammonium Nitrate 89
5.5.2 Biodiesel news 89
5.5.3 Molasses 90
5.6 Major shipping Issues 90
6. Profile – MISC Berhad 91
7. Listings 97
L1 Chemical carrier new orders 98
L2 Chemical carrier – secondhand sales 100
L3 Chemical carrier deliveries 103
L4 Chemical carrier demolition sales 105
L5 Chemical time charter fixtures 106
L6 Chemical carriers converted to DH 107
ii © Drewry Shipping Consultants Ltd

3Q2007
1.1 Time charter rates: modern vessels 01

1.2 Deep sea spot freight rates – Transatlantic 02
1.3 Regional spot freight rates – other 03
1.4 Regional spot freight rates 04
1.5 The market – at a glance 05
2.1 GDP growth 07
2.2 Exchange rates 08
2.3 USA: organic chemical exports 09
2.4 EU-15: organic chemical exports 10
2.5 China: organic chemical exports 10
2.6 India: organic chemical exports 10
2.7 Japan: organic chemical exports 11
2.8 South Korea: organic chemical exports 11
2.9 Taiwan: organic chemical exports 11
2.10 India organic chemical exports by country, 2006 12
2.11 Japan: organic chemical commodity exports 2002-1H07 12
2.12 USA: organic chemical imports 14
2.13 EU-15: organic chemical imports 14
2.14 China: organic chemical imports 15
2.15 India: organic chemical imports 15
Tables
2.16 Japan: organic chemical imports 16

2.17 South Korea: organic chemical imports 16
2.18 Taiwan: organic chemical imports 16
2.19 India organic chemical imports by country, 2006 17
2.20 Japan organic chemical commodity imports 2002-1H07 17
2.21 USA: inorganic chemical exports 18
2.22 China: inorganic chemical exports 18
2.23 Japan: inorganic chemical exports 19
2.24 USA: inorganic chemical imports 19
2.25 China: inorganic chemical imports 20
2.26 Seaborne chemical trade 21
2.27 Intra regional seaborne trade flows 22
2.28 Total seaborne trade – bulk liquid chemicals and
associated products 24
3.1 Chemical tanker employment – tonne miles 27
3.2 Chemical tanker demand 28
3.3 The total chemical tanker fleet 30
3.4 Total chemical tanker fleet by type/trading status:
September 2007 31
3.5 Total chemical tanker orderbook development 32
3.6 Total chemical tanker orderbook by type and expected
employment status 32
© Drewry Shipping Consultants Ltd iii

3Q2007
3.7 Chemical tanker deliveries 33

3.8 Total chemical tanker fleet age profile: September 2007 34
3.9 Chemical tanker demolition 35
3.10 Forecast chemical tanker fleet by size 36
3.11 Forecast chemical tanker fleet by type and employment 37
3.12 Chemical tanker supply/demand balances 41
3.13 Estimated representative chemical tanker rates -
coated vessels 43
3.14 Estimated representative chemical tanker rates -
IMO 2/3 fully stainless vessels 44
3.15 General deep sea and regional freight rates 45
3.16 General oils fats and molasses freight rates 46
3.17 Chemical tanker market activity 47
3.18 Newbuiling prices – IMO 2 – stainless 48
3.19 Newbuiling prices – IMO 2 – coated 48
3.20 Secondhand prices – IMO 2 – stainless 49
3.21 Secondhand prices – IMO 2 – coated 49
3.22 Historical and forecast bunker prices 50
3.23 Representative operating costs for 2007 50
4.1 General deep sea and regional freight rates 55
Tables
4.2 Jubail exports Jan-July 2007 by owner share 60

4.3 Jubail exports Jan-July 2007 by product 60
4.4 Jubail exports Jan-July 2007 by area of discharge 60
4.5 Iranian chemical exports Jan-June 2007 by port share 61
5.1 General oils fats and molasses freight rates 65
5.2 17 oils and fats: world production by type and estimated
volumes by sea 69
5.3 Malaysian palm oil exports by discharge area Jan-May 2007 69
5.4 Malaysian palm exports by operator Jan-May 2007 70
5.5 Indonesian exports by operator Jan to Sep 2007 71
5.6 Indonesian exports by load ports Jan-Sep 2007 72
5.7 Indonesian exports by discharge area Jan to Sep 2007 73
5.8 Brazilian exports by region Jan-Sep 2007 73
5.9 Brazilian exports by owner Jan-Sep 2007 73
5.10 Brazilian exports by charterer/shipper Jan-Sep 2007 75
5.11 Argentinean exports by region Jan-Sep 2007 75
5.12 Argentinean exports by load port Jan-Sep 2007 75
5.13 Argentinean exports by owner/operator Jan-Sep 2007 77
5.14 EU-25: supply and demand of 17 oils and fats 2002-2007 79
5.15 India: Imports of 6 major oils 82
5.16 U.S.A: supply and demand of soya oil 82
5.17 17 Palm oil- world supply and demand 83
iv © Drewry Shipping Consultants Ltd

3Q2007
5.18 Coconut oil : oil world balance 84

5.19 Palm kernel oil world balance 84
Tables 5.20 Soya oil: world supply and demand 86
5.21 Sun oil : summary of world balance 86
5.22 Rapeseed oil : summary of world balance 87
5.23 Tallow and Grease: exports of key countries 88
5.24 Rotterdam: stocks of 14 oils and fats-stocks at end of month 89
1.1 Chemical tanker freight rate index 01

1.2 Chemical tankers supply/demand balance 01
1.3 30,000+ dwt supply/demand balance 02
1.4 30,000+ dwt orderbook development 02
1.5 Organic deepsea seaborne trade 02
1.6 10-20,000 dwt supply/demand balance 03
1.7 10-20,000 dwt orderbook development 03
1.8 Organic regional seaborne trades 03
1.9 Freight rate index: veg oils 04
1.10 Veg oils/animal fats: inter regional seaborne trades:
selected routes 04
1.11 Orderbook as a % of fleet 04
2.1 US growth in monthly retail and food services 08
Figures
2.2 EU25 – industrial production, imports and exports 08

2.3 China – industrial output and exports 08
2.4 Japan – industrial production and consumer confidence 08
2.5 USA – chemical exports 09
2.6 China – chemical exports 09
2.7 USA – chemical imports 13
2.8 China – chemical imports 13
2.9 Seaborne trade growth by chemical group 21
2.10 India organic chemical exports by country, 2006 23
2.11 India: organic chemical imports by country, 2006 23
3.1 Chemical carrier fleet development 28
3.2 Fleet age profile 33
3.3 Percentage by type of fleet 35
4.1 Spot rates - Transatlantic eastbound, USG - Rotterdam 51
4.2 Spot rates: Transatlantic westbound, Rotterdam - USG 52
4.3 Spot rates: Transpacific westbound US Gulf-Far East 53
4.4 Spot rates: Middle East Gulf to NW Europe 54
© Drewry Shipping Consultants Ltd v

3Q2007
4.5 Spot rates: NW Europe to India/Asia and Far East 56

4.6 Spot rates: US Gulf to S. America 57
4.7 Spot rates: Far East to Rotterdam and US Gulf 58
4.8 Spot rates: AG to India, Singapore and Far East 59
4.9 Total owner shares ex Jubail Jan-Jul 2007 60
4.10 Products by volume Jubail Jan - Jul 2007 60
4.11 Jubail by discharge area Jan-Jul 2007 61
4.12 Jubail methanol by owner Jan-Jul 2007 61
4.13 Jubail methanol by discharge area Jan-Jul 2007 61
4.14 Iranian exports by world area Jan-Jun 2007 62
4.15 Iranian exports by owner Jan-Jun 2007 62
4.16 Iranian exports Jan-Jun 2007 by product 63
4.17 Spot rates: Singapore to various ports 3,000 mt
easy chemicals 64
Figures
5.1 2001-2007 main commodity trade lanes 66

5.2 Malaysian palm exports Jan-May 2007 69
5.3 Malaysian exports by owner Jan-May 2007 70
5.4 Malaysian palm load ports Jan-May 2007 71
5.5 Indonesian exports by discharge area Jan-Sep 07 72
5.6 Brazilian exports by discharge area Jan-Sep 07 74
5.7 Brazilian oil exports by owner Jan-Sep 2007 74
5.8 Brazilian exports by charterer/shipper Jan-Sep 2007 75
5.9 Argentina exports by discharge area Jan-Sep 2007 76
5.10 Argentina exports by charterer/shipper Jan-Sep 2007 76
5.11 Argentina oil exports Jan-Sep 2007 by owner 77
5.12 Change by year in world production & demand 2000-2008 78
5.13 EU oils and fats imports 78
5.14 EU-25: imports of oils and fats 79
5.15 SBO imports to EU-27 2002-2007 80
5.16 China: imports of palm and soya oil 80
5.17 Chinese changes of imports of major oils Jan-Jul 06-07 81
vi © Drewry Shipping Consultants Ltd

3Q2007
chemical forecaster executive summary
1. Market summary
Summary...
Long Term / Short Term
Freight Rates
Rise Ê Remain Firm ÅÆ
The first half of 2007 was spent believing that this year
would be unprecedented in terms of its earnings, due to
- Uncertainty in world economy the fleet reclassification changes. While a few owners
stepped back to wait and watch, several other sold their
+ Planned capacity augmentation non-compliant vessels to the scrapyards. Equally,
+ Regulatory changes in trading fleet several vessels were converted in order to be able to
make profits on this booming niche markets.
- Weak freight markets
However, the third quarter has suggested that going
forward things may be a little different. In tandem with a
Secondhand Values Values Remain Firm ÅÆ
soft CPP market, the chemical markets also fell and the
question now is whether further falls in rates are
+ Secondhand prices remain firm inevitable. Our view of the market outlook has certainly
changed due to a very large orderbook, and we expect
- Few candidates for resale to see more weakness in rates in 2008 and 2009, but
with differences emerging between the stainless and
Newbuilding Prices Prices Remain Firm ÅÆ non stainless markets.
+ Increase in newbuilding prices Chemical tanker freight rate index

(easy chemicals)
- Berth space pushed forward to 2010
250 Freight index
200
150
100
Time charter rates: modern vessels (1 yr US$pd)
50
1Q03 4Q03 3Q04 2Q05 1Q06 4Q06 3Q07
IMO 2 Coated IMO 2 stainless
Source: Drewry
Dwt 22/ 30/ 8/ 22/
24,000 32,000 9,000 24,000
2002 10,937 11,970 8,429 16,117
Chemical tankers supply/demand balance
2003 11,074 12,509 8,429 15,553 (‘000 dwt)
2004 12,550 14,237 8,534 16,526
2005 13,889 16,017 10,475 19,472 Supply Demand

90,000
2006 14,875 18,388 11,725 22,125 Forecast
rplus
g su
2007 18,000 22,000 14,000 25,000
80,000
er atin
Op
2008 16,000 20,000 13,000 22,000 70,000
forecast
2009 14,000 18,000 12,000 20,000 60,000

2010 16,000 20,000 14,000 23,000 50,000
2011 17,000 22,000 17,000 25,000 40,000
30,000
* Rate as of Sep 2007, otherwise annual averages.
02 03 04 05 06 07 08 09 10 11
Source: Drewry * Chemical tankers only, excludes CPP ships.
Source: Drewry

3Q2007
Deep sea market

Deep sea spot freight rates – Transatlantic
($/mt) A weak market
During the third quarter freight rates fell across the

Transatlantic Transatlantic
East West board. Of late, the trade has become more and more
Parcel 1,000 2,500 1,000 2,500 concerned as to how the never ending amount of new
Size sus easy sus easy buildings will be absorbed, particularly if the Chinese
2002 49 34 51 44 economy slows.
2003 52 36 52 43
2004 51 36 50 42 All eyes have been on China, as lower demand coupled
2005 61 49 59 47
with high commodities prices seemed to be pointing to a
2006 70 52 78 64
worrying slowdown. Also, lack of interest in European
2007* 83 68 71 57
gasoline in the US caused CPP rates plummet to their
1Q06 60 42 90 75 lowest for four years which did not help an already weak
2Q06 72 50 80 62 chemical market westbound.
3Q06 72 57 75 62
4Q06 74 58 65 58 The less regular owners were reported to be looking to
1Q07 83 72 73 59 alternative markets to try and improve income, as spot
2Q07 85 73 73 60
chemical rates dropped by some 15.0% over the
3Q07 80 58 66 52
quarter.
* Year to date
Source: Drewry
30,000+ dwt supply/demand balance ('000 dwt) Organic deepsea seaborne trade ('000 tonnes)
Supply Demand 10,000 US-SE Asia AG-US US-NW E
26,000
Forecast
8,000
us
24,000 urpl
e ra ting s
O p 6,000
22,000
4,000
20,000
2,000
18,000 0
02 03 04 05 06 07 08 09 10 11 2002 2003 2004 2005 2006 2007e
Source: Drewry Source: Drewry
30,000+ dwt orderbook development ('000 dwt)
18,000 30,000+
15,000
12,000
9,000
6,000
MAX
3,000
MIN
0
1Q03 4Q03 3Q04 2Q05 1Q06 4Q06 3Q07
Source: Drewry
02 © Drewry Shipping Consultants Ltd

3Q2007
Regional trades
Regional spot freight rates – other ($/mt) Dull quarter
Overall, 3Q07 was a dull period for the regional markets.

Arabian Gulf/ Houston/ Brazil/
Parcel India Brazil Houston
With the exception of some improved demand from
Size 5,000 10,000 5,000 5,000
WCI, regional markets were more or less at status quo.
2002 24 22 26 30
If there was tonnage open and available it was generally
2003 26 21 26 34
2004 26 21 28 46
because of reasons of age, approvals and previous
2005 30 25 32 51 cargoes. Generally, scheduling of chemical tankers
2006 29 25 34 56 became ever more problematic for end August - early
2007* 30 25 35 55 September, due to various unforeseen delays. This
resulted in cancellations of some spot fixtures, delayed
1Q06 30 26 32 57 deliveries to certain customers and uncertainties
2Q06 27 24 32 55 regarding available positions towards the end of the
3Q06 29 25 35 55 quarter.
4Q06 28 23 35 55
1Q07 30 26 35 55
As for contracts, owners reported healthy volumes and
2Q07 30 25 35 55
this was evidenced by little spot space available from
3Q07 29 24 35 54
the regulars. Rates for semi-prompt cargoes going east
* Year to date were definitely under pressure, whereas westbound
Source: Drewry volumes (often being more demanding on approvals)
seemed to be holding steady.
10-20,000 dwt supply/demand balance (‘000 dwt) Organic regional seaborne trades ('000 tonnes)
Supply Demand Intra SEA Latin America-US

24,000
8,000 US-Latin America
Forecast
20,000
7,000
16,000
6,000
12,000
5,000
8,000
surplus
4,000 ng
rati 4,000
Ope
3,000 0
02 03 04 05 06 07 08 09 10 11 2002 2003 2004 2005 2006 2007e
10-20,000 dwt orderbook development ('000 dwt)
8,000 10-20,000
7,000
6,000
5,000
4,000
3,000 MAX
2,000
1,000
MIN
0
1Q03 4Q03 3Q04 2Q05 1Q06 4Q06 3Q07
Source: Drewry

3Q2007
Veg oils/animal fats market

Regional spot freight rates ($/mt) Summary
Compared to the main chemical and CPP markets, oils

SE Asia- Argentina/ Argentina/ US Gulf-
and fats freight has been relatively steady, nevertheless
Rotter- Brazil- Brazil- India/
Parcel dam China WC India Pakistan they are still weakening. Historically, soft oil freight, with
Size 30,000 25/30,000 30,000 25,000 the exception of the last few months leading up to 1st
2002 32 34 27 42
January 2007 (as the unqualified ships fixed their last
2003 37 40 33 53 voyages), has been observed to track the vagaries of
2004 40 53 48 78 the CPP market, albeit with a lapse of a few months
2005 54 60 54 69 behind the peaks and troughs.
2006 60 51 45 52
2007* 61 69 64 77 Overall our observation is that demand for oils and fats
has been checked by high prices and also consumption
1Q06 65 58 48 50
is reported to have slowed. But to date sea borne trade
2Q06 52 48 42 52
3Q06 60 50 46 52
volumes do not appear to be affected. There are long
4Q06 63 49 45 52 term factors that could in fact increase ocean going
1Q07 65 70 62 85 trade to the detriment of regional movements,
2Q07 59 77 71 85 particularly for sun oil and rape that are being replaced
3Q07 59 60 60 60 by palm.
* Year to date
For 2008, increased demand for vegoils is likely to be
Source: Drewry
met by improved production of palm oils. Nevertheless,
we expect world oil and fat reserves to be drawn-down.
Freight rate index: veg oils (1Q99=100)
On the freight markets side, the tropical oil market to
260 Freight rate index
Europe has stayed fairly constant, although slipping
around 1.0% over the quarter and around 4.5% over this
230
time last year.
200
Soft oil rates out of South America slipped by around
170
17.0% in the third quarter of 2007, but are still up 6.0%
140 over the same period of 2006.
110
80
1Q03 4Q03 3Q04 2Q05 1Q06 4Q06 3Q07
Source: Drewry
Veg oils/animal fats: inter regional seaborne

trades: selected routes ('000 tonnes) Orderbook as a % of fleet
8,000 Intra SEA Latin America-SEA 50 Orderbook as a % of fleet

SEA-NWE Average (2001-05)
45
6,000
40
4,000
35
2,000
30
0 25
2002 2003 2004 2005 2006 2007e 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07

3Q2007
The market – at a glance
Actual Forecast
2002 2003 2004 2005 2006 2007* 2008 2009 2010 2011
Total Seaborne Trade (Mill T) 132.7 139.3 142.6 148.5 154.9 159.3 165.3 171.4 177.6 181.8
% Change -0.2 5.0 2.3 4.1 4.3 2.8 3.8 3.7 3.6 2.4
Of Which:
Organics - Mill T 65.5 68.6 70.5 72.2 74.5 77.7 81.2 84.9 88.7 90.9
% Change -6.7 4.7 2.7 2.5 4.5 4.3 4.5 4.5 4.5 2.5
Inorganics - Mill T 15.1 15.8 15.7 17.5 18.9 19.0 19.6 20.1 20.7 21.1
% Change -0.6 4.2 -0.3 11.1 3.0 0.7 3.0 2.7 2.6 2.2
Vegetable/Animal Oils - Mill T 37.1 39.7 40.7 43.1 45.4 46.3 48.2 49.7 51.2 52.7
% Change 13.3 7.1 2.4 5.9 5.0 2.0 4.0 3.2 3.0 2.8
Other Cargoes - Mill T 15.0 15.2 15.7 15.7 16.0 16.2 16.3 16.7 17.0 17.2
% Change 1.4 1.3 3.3 0.0 2.0 1.0 1.0 2.0 2.0 1.0
Chemical Tanker Demand** (mdwt) 30.0 31.8 32.1 33.6 36.0 40.0 41.7 43.1 45.0 47.5
% Change 40.8 6.0 0.9 4.7 6.8 11.1 4.3 3.4 4.4 5.5
Chemical Tanker Supply*** (mdwt) 40.6 43.7 48.4 52.8 62.1 67.5 75.4 82.2 87.1 88.8
% Change 5.5 7.6 10.8 9.1 17.5 8.7 11.7 9.0 6.0 2.0
Orderbook (mdwt) 3.3 4.3 6.5 18.1 22.8 25.1 n/a n/a n/a n/a
% Fleet 13.6 17.9 25.5 33.0 37.3 37.2 n/a n/a n/a n/a
Deliveries*** 3.2 5.2 7.0 6.5 7.4 11.0 7.8 6.6 4.1 1.3
Deletions*** 0.3 0.5 1.2 0.6 0.8 2.5 0.4 0.3 0.7 1.1
Estimated chemical tanker rates ($/day)
IMO 2 8/9,000 stainless 8,429 8,429 8,534 10,475 11,725 14,000 13,000 12,000 14,000 17,000
IMO 2 22/24,000 stainless 16,117 15,553 16,526 19,472 22,125 25,000 22,000 20,000 23,000 25,000
IMO 2 22/24,000 coated 10,937 11,074 12,550 13,889 14,875 18,000 16,000 14,000 16,000 17,000
IMO 2 30/32,000 coated 11,970 12,509 14,237 16,017 18,388 22,000 20,000 18,000 20,000 22,000
Spot rates ($/mt)
Transatlantic - East 2,500 36.3 36.3 48.8 54.3 52.0 68.0 n/a n/a n/a n/a
- West 2,500 43.0 41.8 47.3 58.5 64.0 57.0 n/a n/a n/a n/a
Newbuilding prices US$m
IMO 2 8/9,000 stainless 13.1-16.0 13.5-16.5 16.2-19.8 18.5-22.6 21.6-26.4 22.4-27.5 n/a n/a n/a n/a
IMO 2 22/24,000 coated 17.1-20.9 17.6-21.5 19.8-24.2 22.8-27.8 24.3-31.8 30.9-37.8 n/a n/a n/a n/a
Secondhand prices US$m
* Projections for the year: except for fleet and orderbook, which are latest assessments at time of going to press and deliveries and deletions, which
are cumulative figures for the year to date.
** Pure chemical tankers only, excludes CPP ships. End period fleet.
*** All ships IMO and Non-IMO.
Source: Drewry

06
3Q2007
chemical forecaster economy and trade
2. Economy and trade grow by 10.0% and 7.3% respectively. Table 2.1
suggests that in 2008, Asia (excluding Japan) and Latin
America may also grow moderately at the rate of 7.6%
2.1 Global economy: recovery in 2009 and 4.5% from 8.6% and 5.4% in 2006, respectively.
In line with the expectations outlined last year, recent However, with oil prices above US$90/bbl there has
estimates show that the world economy has marginally been a global fear of rise in inflation. This fear has been
decelerated in 2007, registering a growth of less than further aggravated by the credit crisis and over-inflated
5% so far this year compared to 5.2% in 2006. The year assets. These phenomena have led to increased
2008 is expected to witness a further decline in terms of growth and inflation especially in Russia, the Middle
growth. This pessimism originates from the recent crisis East and Asia excluding Japan. In the developed
in the credit market and downturn in the housing market countries, such as the US and Canada, a downshift in
in the US. This trend may be reversed in 2009 when productivity also points to rising inflation. Moreover, in
rate of growth of world real GDP is expected to reach low-inflation ASEAN economies such as Malaysia and
4.9%. Singapore, increasing domestic demand may lead to
increase in inflation. Collectively, these developments
In 2008, the world economy is forecast to grow signify rising inflation around the globe.
moderately at 4.6%. However, growth in the industrial
economies may be as low as 2.1%. European countries In the currency markets, the US dollar continued to
have felt the repercussion of sub-prime crisis in the US, depreciate against all the major currencies. In 3Q07,
while Japan is forecast to witness moderate growth, due the dollar depreciated against Japanese Yen as well. In
to weaker external demand for its products and softness the previous quarter Yen/USD fell from 123 to 115.
in domestic spending.
Dollar depreciation may cause short term difficulties for
In contrast, growth in the emerging economies is the developing countries but may not be that damaging
expected to remain strong. China and India have in the long term as the income growth of their trading
contributed tremendously to the global growth in recent partners is a more important factor in determining the
years, and in 2008 the two economies are expected to growth rate of developing economies.
Table 2.1 GDP growth (% change previous period)
2002 2003 2004 2005 2006 2007(e) 2008(e)
Global Economy 4.1 5.3 4.7 5.2 5.0 4.6 4.9
Industrial World 1.9 3.0 2.4 2.8 2.3 2.1 2.7
USA 2.7 3.9 3.1 2.9 2.0 2.0 2.9
Europe 1.1 2.1 1.7 2.9 2.6 2.0 2.5
France 1.1 2.3 1.7 2.2 1.8 2.0 2.6
Germany 0.0 1.2 0.9 2.9 2.4 1.9 2.2
UK 2.5 3.3 1.8 2.8 2.9 2.0 2.3
Japan 1.8 2.7 1.9 2.2 1.9 2.1 2.6
Asia ex Japan 7.0 7.9 7.9 8.6 8.4 7.6 7.6
China 10.0 10.1 10.4 11.1 11.3 10.0 9.5
India 7.4 7.0 8.7 9.6 8.4 7.3 8.3
Korea 3.1 4.7 4.2 5.0 4.6 4.8 5.3
Latin America 2.1 6.1 4.5 5.4 5.3 4.5 4.5
Source: Morgan Stanley

3Q2007
Figure 2.1 US growth in monthly retail and Figure 2.3 China – industrial output and
food services exports
% growth in monthly sales for retail and food services Industrial output (% growth YoY)
6 ($ mio) Exports (% growth YoY)
60
50
5
40
4 30
20
3
10
2 0
Sep 06 Dec 06 Mar 07 Jun 07 Sep 07
Sep 06 Dec 06 Mar 07 Jun 07 Sep 07
Note: Data adjusted for seasonal variations, holiday and trading differences but not for changes in prices
Source: US Census Bureau Source: China National Bureau of Statistics
Tanker Orderbook % Fleet (Dwt)
Figure 2.2 EU25 – industrial production, Figure 2.4 Japan – industrial production and
imports and exports consumer confidence
Import of goods (% growth) Industrial production (% growth YoY, left axis)

Export of goods (% growth) Consumer confidence index (Tokyo, right axis)
Industrial production (% growth) 6 52
15
5 50
12
4 48
9
3 46
6
2 44
3
5 YEAR RANGE
Tanker Or derbook % Fleet (Dwt) 1 42
0
Jul 06 Oct 06 Jan 07 Apr 07 Sep 06 Dec 06 Mar 07 Jun 07 Sep 07
Jul 07
Source: Eurostat Source: Japan Ministry of Economy, Trade and Industry
Table 2.2 Exchange rates (US$ per unit, except GBP and SDR)
Japanese UK Euro Special Chinese South Norwegian Indian

Yen Pound* Drawing Renminbi Korean Krone Rupee
Rights* Won
2002 124.15 1.51 0.95 1.30 8.28 1,251.67 7.99 48.57

2003 116.11 1.64 0.89 1.40 8.28 1,186.73 7.04 46.57
2004 108.20 1.83 0.81 1.46 8.28 1,147.08 6.76 45.26
2005 110.08 1.82 0.81 1.48 8.19 1,024.67 6.44 44.05
2006 116.40 1.84 0.80 1.47 7.98 955.84 6.41 45.29
2007* 118.41 1.99 0.74 1.51 7.69 935.12 6.08 42.71
2Q06 114.81 1.82 0.80 1.47 8.01 951.96 6.26 45.38

3Q06 115.97 1.88 0.78 1.48 7.97 955.69 6.32 46.36
4Q06 117.81 1.92 0.78 1.48 7.87 940.95 6.46 45.22
1Q07 118.65 1.95 0.76 1.50 7.78 937.74 6.23 44.29
2Q07 119.11 1.98 0.74 1.51 7.72 936.54 6.14 42.79
3Q07 117.47 2.02 0.73 1.53 7.58 931.08 5.87 41.04
Source: Morgan Stanley

3Q2007
Figure 2.5 USA – chemical exports Figure 2.6 China – chemical exports
(‘000 tonnes) (‘000 tonnes)
20,000 Inorganic Exports Organic Exports 3,000 Inorganic Exports Organic Exports
2,500
15,000
2,000
10,000 1,500
1,000
5,000
500
0 0
2002 2003 2004 2005 2006 2007e 2002 2003 2004 2005 2006 2007e
2.2 Organic chemicals 2007 started on an optimistic note for the US organic
chemical exports. On the back of an enormous boost of
2.2.1 Exports export volumes to SE Asia (by 33.0% over the 4Q06
tally), the quarterly tally of US organic exports reached
Our estimates for the total intra-regional organic 3.6m tonnes, 12.6% higher than 4Q06.
seaborne trade on our selected trade routes in 2006 has
been revised since the previous publication and placed The second quarter of the year is traditionally a slow
slightly upwards at 48.3m tonnes. We expect the period for organic chemical exports. 2Q07 was no
upward trend to have been maintained in 2007, with exception for the US region and thus the reported
annual trade volumes provisionally estimated at 50.8m volumes were placed at 3.4m tonnes, lowed by 5.2%
tonnes (as against 50.6m tonnes forecast during 2Q07). over the previous quarter. It is worth noting here that
drop in trade volumes was attributed to a drop in exports
On an intra-regional basis, SE Asia continues to be the reaching the SE Asian region that dropped by almost
most active trading zone. In 2006, trade volumes in the 21.0% in 2Q07.
region were reported at almost 18.0m tonnes. But in
2007, we expect trade to touch the 19.6m tonne mark, While the SE Asian region was the primary focus
9.0% higher than the previous year. area for the US organic exports during 1H07, the
Table 2.3 USA: organic chemical exports ('000 tonnes)
Destination SE Asia L.Am Eur Japan S.Am Other Total
2002 2,818 3,706 2,255 584 226 200 9,789

2003 4,540 4,118 2,355 620 239 199 12,071
2004 5,670 4,404 2,108 753 239 216 13,391
2005 3,787 4,223 1,906 671 176 203 10,966
2006 2,628 5,560 3,637 394 160 311 12,690
2007e 3,758 5,802 3,660 412 198 140 13,970
4Q05 481 1,077 274 141 15 34 2,022

1Q06 591 1,248 436 93 32 48 2,448
2Q06 758 1,318 1,230 158 57 124 3,645
3Q06 492 1,593 1,148 61 43 76 3,413
4Q06 787 1,401 823 82 28 63 3,184
1Q07 1,047 1,397 930 95 70 46 3,585
2Q07 832 1,504 900 111 29 24 3,400
Source: Drewry, derived from Customs Statistics

3Q2007
Table 2.4 EU-15: organic chemical exports ('000 tonnes)
Destination SE Asia Japan Eur N.Am L.Am Other Total

2002 451 448 482 136 152 569 2,238
2003 693 503 368 153 167 535 2,419
2004 699 475 373 152 152 421 2,272
2005 525 467 509 143 185 444 2,273
2006 478 450 736 142 158 558 2,522
2007e 624 592 732 120 200 680 2,948
4Q05 126 113 170 44 31 138 622

1Q06 161 119 253 33 65 145 776
2Q06 97 112 207 35 23 128 602
3Q06 82 101 161 36 36 135 551
4Q06 138 118 115 38 34 150 593
1Q07 156 148 183 30 50 170 737
2Q07 n/a n/a n/a n/a n/a n/a n/a
Table 2.5 China: organic chemical exports ('000 tonnes)
Destination SE Asia Japan Eur N.Am L.Am Other Total

1999 151 3 8 8 1 1 171
2002 146 22 9 3 7 2 188
2003 275 19 10 4 7 4 319
2004 174 15 18 6 4 12 230
2005 328 21 35 40 12 26 462
2006 641 52 49 24 25 57 848
2007e 1,152 40 54 14 30 228 1,518
4Q05 107 6 7 16 3 6 145
1Q06 124 7 8 4 5 6 154
2Q06 121 5 9 13 6 20 174
3Q06 172 25 14 4 7 18 240
4Q06 239 15 15 3 7 30 309
1Q07 298 14 11 3 7 76 409
2Q07 278 6 16 4 8 38 350
Table 2.6 India: organic chemical exports ('000 tonnes)
Destination SE Asia Middle East Eur N. Africa N.Am Other Total

2002 108 39 31 5 2 13 198
2003 258 108 27 4 2 18 416
2004 376 44 52 4 19 9 504
2005 519 86 19 8 3 7 642
2006 954 183 161 11 83 33 1,425
2007e 488 108 56 16 4 52 724
4Q05 118 9 8 3 1 2 141

1Q06 310 48 31 3 1 16 409
2Q06 231 26 48 3 13 10 331
3Q06 207 46 36 3 17 3 312
4Q06 202 63 46 3 52 6 372
1Q07 122 27 14 4 1 13 181

3Q2007
Table 2.7 Japan: organic chemical exports ('000 tonnes)
Destination SE Asia S. Am Eur N.Am Australia Other Total

2002 5,107 64 102 34 22 28 5,357
2003 5,620 54 88 21 8 47 5,839
2004 5,524 27 78 15 8 42 5,694
2005 6,557 63 62 21 7 34 6,744
2006 6,279 28 76 18 10 44 6,455
2007e 3,660 16 38 8 4 3,554 7,280
1533 12 22 4 2 14 1587
4Q05 1742 5 8 8 2 15 1780
1Q06 1,722 5 15 5 3 11 1,761
2Q06 1,454 6 14 3 3 11 1,491
3Q06 1,515 11 20 4 2 8 1,560
4Q06 1,588 6 27 6 2 14 1,643
1Q07 1,830 8 19 4 2 10 1,873
2Q07 1,767 0 0 0 0 0 1,767
Table 2.8 South Korea: organic chemical exports ('000 tonnes)
Destination SE Asia Japan N.Am S. Am Eur Other Total

2002 4,205 328 242 141 215 105 5,236
2003 4,471 446 172 75 111 175 5,451
2004 4,332 544 375 71 32 184 5,538
2005 4,556 536 465 92 36 173 5,858
2006 5,385 487 596 82 70 171 6,791
2007e 5,958 354 610 100 104 196 7,322
4Q05 1168 144 99 32 9 41 1493
1Q06 1,263 114 140 16 12 46 1,591
2Q06 1,224 144 197 18 10 37 1,630
3Q06 1,377 144 120 34 29 43 1,747
4Q06 1,521 85 139 14 19 45 1,823
1Q07 1,499 70 125 20 26 48 1,788
2Q07 1,480 107 180 30 26 50 1,873
Table 2.9 Taiwan: organic chemical exports ('000 tonnes)
Destination SE Asia S. Am N. Am Japan Eur Other Total

2002 952 52 20 19 36 38 1,117
2003 1,187 35 23 21 13 42 1,320
2004 1,452 52 23 22 14 54 1,617
2005 1,872 93 41 37 37 56 2,135
2006 1,832 98 52 68 57 92 2,199
2007e 2,242 138 14 94 62 94 2,644
4Q05 460 32 18 14 10 14 548

1Q06 418 13 26 10 12 22 501
2Q06 494 31 12 16 11 25 589
3Q06 449 35 7 20 19 20 550
4Q06 471 19 7 22 15 25 559
1Q07 551 34 1 23 17 18 644
2Q07 570 35 6 24 14 29 678
Source: Drewry

3Q2007
Table 2.10 India organic chemical exports by country, 2006 ('000 tonnes)
Import Country
Chemical Indonesia China Singapore Malaysia Saudi United UAE Other Total
Arabia States
Benzene 10 0 115 22 76 58 21 149 451
Xylene-p 293 0 5 58 8 0 18 36 418
Xylene-o 5 188 0 26 0 0 0 44 263
Ethylene Glycol 1 78 1 0 0 0 2 10 92
Phthalic Anhydride 1 7 0 1 15 0 11 28 62
Acetic Acid 0 0 23 11 0 0 1 9 45
Acrylonitrile 0 0 0 0 0 17 0 2 19
Acrylic Acid Esters 1 1 6 1 0 2 0 2 13
Isocyanates 0 0 1 0 0 1 0 10 12
Vinyl Acetate 0 0 7 0 0 1 0 1 9
Acetic Acid Esters 0 1 1 0 0 1 0 5 8
Cyclic Hydrocarbons, Nesoi 2 2 0 0 0 1 1 1 7
Xylene-m 4 0 0 0 0 0 2 0 6
Xylene-mixed 0 0 0 0 0 0 3 0 3
Phenol 0 1 0 1 0 0 0 1 3
Maleic Anhydride 0 0 0 0 0 0 0 1 2
Other 0 1 3 0 0 2 0 7 13
Total 318 278 160 120 100 83 60 306 1,426
Source: Drewry
Table 2.11 Japan: organic chemical commodity exports 2002-1H07 ('000 tonnes)
Chemical Chemical Sub Group 2002 2003 2004 2005 2006 1H07 % Chg
06-07
Xylene-p Aromatic Hydrocarbon 1,730 2,006 2,008 2,259 2,290 2,378 4%
Styrene Aromatic Hydrocarbon 1,045 1,205 1,341 1,452 1,379 1,691 23%
Xylene-mixed Aromatic Hydrocarbon 232 220 241 206 232 362 56%
Toluene Aromatic Hydrocarbon 94 102 121 167 235 288 22%
Cumene Aromatic Hydrocarbon 96 109 146 241 227 260 15%
Isocyanates 250 277 298 268 257 224 -13%
Benzene Aromatic Hydrocarbon 310 248 300 313 247 213 -14%
Ethylene Glycol Alcohols/Glycols 121 202 170 238 168 190 14%
Phenol Phenols 105 79 87 110 96 179 87%
Acrylonitrile Monomers/Esters 168 204 186 171 122 167 38%
Cyclohexane Saturated Hydro/Olefin 113 116 124 187 178 163 -9%
Methyl Ethyl Ketone Ketones 109 153 123 133 127 161 27%
Vinyl Acetate 98 107 105 97 105 153 45%
Acetone Ketones 42 40 76 65 84 114 35%
Methacrylic Acid Esters Monomers/Esters 122 84 66 95 103 113 10%
Propylene Oxide 5 54 110 81 92 91 -1%
Other 681 599 661 632 488 525 8%
Total 5,320 5,806 6,161 6,714 6,430 7,273 13%
Note: figures exclude MTBE
Source: Drewry

3Q2007
Latin American region (the largest consumer of the 2007, 2007 export volumes are likely to increase by
US exports so far) also increased their intake of US 13.1%.
organic exports during 2Q07, by almost 8.0%, at 1.5m
tonnes. Another important exporter in the region, South Korea,
also remained a busy destination as it increased its
On an annual basis, US organic exports are expected to export volumes by almost 4.8%, at 1.9m tonnes during
increase by 10.0% during 2007 almost 14.0m tonnes. 2Q07. The annual tally of exports from the region are
forecast to increase by a healthy 7.8% and are likely to
In the EU-15 organic chemical exports, are expected to finish at 7.3m tonnes by the end of 2007.
increase by almost 16.9% on a year-on-year basis. As
such we expect the total organic exports from the EU-15 2.2.2 Imports
to reach 2.9m tonnes by the end of 2007.
In 2Q07, US organic imports continued at the same
Moving eastwards, annual forecasts suggest that China levels as the previous quarter. Our latest estimates
intends to slowly but surely, make its presence felt on suggest that almost 2.7m tonnes of organic chemicals
the global map for organic exports. were imported. This translated to a 1.6% increase in
import volumes on a quarter on quarter basis.
The forecast of 2007 organic chemical exports from
China is currently at 1.5m tonnes. It is worth noting that Most of the US organic imports were procured from
this is almost 0.7m tonnes higher than 2006. Latin America. In 2Q07, almost 1.9m tonnes of organic
chemicals were sourced from the region.
India, another important region in terms of its fast
growing economy and proximity to China, however,
exhibited a different trading pattern. Figure 2.7 USA – chemical imports
(‘000 tonnes)
In 2006, the region became noticeable, due to a
substantial boost to exports (from 0.6m tonnes to 1.4m 20,000 Inorganic Imports Organic Imports
tonnes), in 2007, the export volumes are expected to fall
back to almost the levels seen in 2005.
15,000
The main reason for the fall in export volumes in lower
10,000
chemical commodities flows to the SE Asia. In 2006,
almost 1.0m tonnes of organic chemicals were routed
from India to SE Asia, in 2007. But in 2007, we expect 5,000
the tally to be only half of the previous year’s records, at

0.5m tonnes. 0
2002 2003 2004 2005 2006 2007e
Source: Drewry
Benzene was the most actively exported chemical from
India, with volumes reported to be almost 0.5m tonnes
in 2006. Following close on the heels, was Xylene-p,
that was mainly exported to Indonesia. The latest Figure 2.8 China – chemical imports
available data suggests that almost 0.4m tonnes was (‘000 tonnes)
exported during 2006 from India.
Inorganic Imports Organic Imports

Xylene-o and Ethylene Glycol were also exported in 20,000
noticeable quantities from India during 2006.
15,000
Japan, the largest exporter of chemical commodities
also showed signs of an increase in volumes. In 2Q07, 10,000
almost 1.9m tonnes of organic chemicals were exported,
in 2Q07, the tally slowed to reach only 1.8m tonnes. 5,000
Xylene and Styrene continued to be the most actively 0

traded chemical commodity in Japan during 1H07, at 2002 2003 2004 2005 2006 2007e
2.4m tonnes and 1.7m tonnes, respectively. Also, over Source: Drewry

3Q2007
Table 2.12 USA: organic chemical imports ('000 tonnes)
Source L.Am Mid East SE Asia Eur W.Af Other Total
2002 5,872 1,827 679 1,577 553 491 10,999
2003 5,133 1,690 491 1,138 683 418 9,553
2004 5,742 1,316 288 936 608 389 9,279
2005 7,918 1,243 579 1,356 766 268 12,130
2006 8,003 582 820 1,776 50 304 11,535

2007e 7,456 290 864 1,324 494 264 10,692
4Q05 1,978 361 174 512 135 89 3,249
1Q06 2,174 341 182 572 1 48 3,318
2Q06 1,816 126 239 677 23 75 2,956
3Q06 1,880 52 231 336 0 106 2,605
4Q06 2,133 63 168 191 26 75 2,656
1Q07 1,846 72 218 362 82 72 2,652

2Q07 1,882 73 214 300 165 60 2,694
Source: Drewry
On an annual basis however, organic imports to the Since 2005, US organic imports have been gradually
US are expected to drop by a slight margin in 2007. Our decreasing. Most of this decrease in volumes is due to
current forecasts suggest that in 2007, the US organic increasing domestic consumption of organic chemicals
imports are expected to drop by 7.3%, to 10.7m tonnes. in the country.
Table 2.13 EU-15: organic chemical imports ('000 tonnes)
Source L.Am FSU Mid East N. Am N. Afr Other Total
2002 2,152 1,119 1,271 1,573 710 1,808 8,633
2003 1,852 1,197 1,254 1,321 652 1,833 8,109
2004 1,290 1,275 1,061 1,205 627 1,488 6,947
2005 1,412 1,470 1,386 1,202 584 2,082 8,136
2006 2,097 1,547 1,792 1,505 637 2,552 10,130

2007e 1,916 1,572 1,736 1,616 476 3,012 10,328
4Q05 411 368 396 245 166 507 2,093
1Q06 522 403 343 247 159 593 2,267
2Q06 428 427 444 355 164 687 2,505
3Q06 523 320 411 398 159 627 2,438
4Q06 624 397 594 505 155 645 2,920
1Q07 479 393 434 404 119 753 2,582

Source: Drewry

3Q2007
Table 2.14 China: organic chemical imports ('000 tonnes)
Source SE Asia Japan N.Am Mid East Aust Other Total
2002 4,591 1,710 1,281 1,873 366 279 10,100
2003 5,404 2,404 1,966 1,675 184 888 12,521
2004 5,432 2,674 2,489 1,784 224 1,077 13,682
2005 6,315 2,842 2,273 2,467 112 981 14,990
2006 6,358 2,570 1,836 2,514 77 901 14,256

2007e 7,072 3,652 2,266 2,858 60 826 16,734
4Q05 1,423 765 491 678 10 223 3,590
1Q06 1,420 653 350 660 36 228 3,347
2Q06 1,547 568 535 604 22 233 3,509
3Q06 1,667 642 561 711 0 265 3,846
4Q06 1,724 707 390 539 19 175 3,554
1Q07 1,755 930 524 604 0 202 4,015

2Q07 1,781 896 609 825 30 211 4,352
Source: Drewry
On the other hand EU-15 imports of organic chemicals In the east, the Chinese organic imports continue to
have been constantly increasing. In 2007 imports are grow. Total organic imports by China were 14.3m
expected to increase by 2.0% and are likely to touch tonnes during 2006. In 2007 we expect a major
10.3m tonnes. The major part of the EU-15 imports are increase in import volumes to 16.7m tonnes, an increase
sourced from the Latin America. of 16.8%.
Table 2.15 India: organic chemical imports ('000 tonnes)
Source Mid East SE Asia Eur N. Am L. Am Other Total
2002 483 370 264 113 22 123 1,373
2003 652 537 268 147 63 170 1,836
2004 701 596 297 221 20 241 2,076
2005 792 700 344 165 56 168 2,225
2006 987 845 220 196 27 125 2,400

2007e 928 795 144 191 68 43 2,092
4Q05 208 202 38 18 1 34 501
1Q06 235 207 80 34 14 36 606
2Q06 251 218 51 40 5 42 607
3Q06 254 209 34 73 1 16 587
4Q06 232 237 40 41 35 4 589
1Q07 153 150 34 29 15 12 393

Source: Drewry

3Q2007
Table 2.16 Japan: organic chemical imports ('000 tonnes)
Source Mid East Austr SE Asia N.Am L.Am Other Total
2002 1,166 769 439 358 93 37 2,862

2003 1,096 559 543 407 257 41 2,903
2004 1,030 444 610 334 209 36 2,663
2005 1,183 235 757 368 306 59 2,908
2006 1,371 105 852 286 320 51 2,985
2007e 1,440 164 864 258 306 46 3,078
4Q05 268 30 210 83 120 10 721

1Q06 366 10 188 80 96 12 752
2Q06 358 38 213 85 77 13 784
3Q06 340 17 283 58 91 11 800
4Q06 307 40 168 63 56 15 649
1Q07 365 49 222 56 78 12 782
2Q07 355 33 210 73 75 11 757
Source: Drewry
Table 2.17 South Korea: organic chemical imports ('000 tonnes)
Source Japan N.Am Mid East SE Asia Austra Other Total
2002 1,270 1,015 1,049 384 631 203 4,552

2003 1,216 1,421 1,049 527 147 545 4,905
2004 1,199 1,624 1,028 561 224 578 5,214
2005 1,539 1,382 1,121 674 40 732 5,488
2006 1,589 831 1,039 1,004 45 714 5,222
2007e 1,350 1,304 916 952 138 638 5,298
320 423 291 157 89 121 1 401

4Q05 439 186 253 168 25 248 1,319
1Q06 431 224 315 161 1 206 1,338
2Q06 429 194 233 268 12 185 1,321
3Q06 359 194 241 293 15 177 1,279
4Q06 370 219 250 282 17 146 1,284
1Q07 336 298 221 264 26 146 1,291
2Q07 339 354 237 212 43 173 1,358
Source: Drewry
Table 2.18 Taiwan: organic chemical imports ('000 tonnes)
Source SE Asia Japan N.Am Mid East Eur Other Total
2002 1,660 1,378 1,238 986 247 229 5,738

2003 1,895 1,162 1,600 1,088 226 248 6,219
2004 1,804 1,219 1,818 1,067 253 201 6,362
2005 1,971 1,282 1,240 1,191 198 118 6,000
2006 2,199 1,463 808 1,248 174 111 6,003
2007e 1,950 1,044 1,092 1,076 96 166 5,424
438 338 534 296 91 27 1 725

4Q05 542 336 161 305 23 23 1,390
1Q06 507 464 191 289 72 33 1,556
2Q06 519 300 256 359 59 28 1,521
3Q06 562 406 180 306 33 26 1,513
4Q06 611 293 181 294 10 24 1,413
1Q07 514 283 294 247 41 40 1,419
2Q07 461 239 252 291 7 43 1,293
Source: Drewry

3Q2007
Table 2.19 India organic chemical imports by country, 2006 ('000 tonnes)
Export Country
Chemical Singapore Saudi Qatar Iran United Malaysia Kuwait Other Total
Arabia States
Methanol 0 163 139 145 7 10 0 27 491
Styrene 196 168 2 0 28 3 0 9 406
Ethylene Dichloride 0 18 125 0 0 0 0 83 227
Xylene-p 46 0 0 10 0 120 0 19 195
Ethylene Glycol 0 51 0 0 0 0 84 0 136
Toluene 23 0 0 27 5 0 0 66 121
Acetic Acid 77 0 0 0 5 22 0 12 117
Acrylonitrile 0 0 0 0 61 0 0 32 94
Phenol 5 0 0 0 25 0 0 43 73
Acetone 10 0 3 0 9 0 0 34 56
Acrylic Acid Esters 22 0 0 0 2 7 0 22 53
Propanols 14 0 0 0 17 0 0 22 52
Vinyl Acetate 37 0 0 0 8 0 0 3 48
Isocyanates 3 0 0 0 2 0 0 42 47
Xylene-o 0 0 0 4 0 0 0 22 26
Acyclic Hydrocarbons, saturated 13 0 0 0 2 0 0 6 21
Other 27 2 0 4 20 8 0 142 203
Total 474 402 269 190 189 172 84 585 2,365
Source: Drewry
Table 2.20 Japan organic chemical commodity imports 2002-1H07 ('000 tonnes)
Chemical 2002 2003 2004 2005 2006 1H07 % Chg
06-07
Methanol Alcohols/Glycols 1,941 1,962 1,977 2,038 1,939 2,208 14%
Ethylene Dichloride Halogenated Compound 295 256 185 153 318 279 -12%
Benzene Aromatic Hydrocarbon 112 140 199 197 217 120 -45%
Phenol Phenols 26 27 1 72 118 83 -30%
Acetic Acid 45 26 27 37 31 55 74%
Acrylic Acid Esters Monomers/Esters 43 46 48 64 54 43 -20%
Acetone Ketones 33 39 24 30 47 39 -18%
Acrylonitrile Monomers/Esters 86 56 62 44 41 34 -17%
Methacrylic Acid Esters Monomers/Esters 12 26 26 26 32 31 -5%
Isocyanates 13 18 30 31 27 27 -1%
Ethylene Glycol Alcohols/Glycols 40 60 36 21 25 24 -2%
Propanols Alcohols/Glycols 30 26 27 17 32 23 -29%
Toluene Aromatic Hydrocarbon 37 78 168 76 17 20 20%
Propylene Glycol Alcohols/Glycols 8 10 12 13 16 16 -2%
Styrene Aromatic Hydrocarbon 35 17 12 12 12 14 14%
Acetic Acid Esters Monomers/Esters 9 9 10 10 11 13 20%
Other 96 105 73 64 50 53 6%
Total 2,861 2,902 2,917 2,906 2,986 3,079 3%
Note: figures exclude MTBE
Source: Drewry

3Q2007
2.3 Inorganic chemicals Nevertheless, we expect the slowdown to be temporary.

Our annual forecasts for the US inorganic exports
2.3.1 Exports suggest a healthy growth of 14.4%, to reach 3.2m
tonnes by the end of 2007. The increase is expected
The second quarter was a mixed one for the exports of mainly on the back of rising exports to Latin America,
inorganic chemicals. While several regions reported an which are pegged to increase from 2.5m tonnes in 2006
increase in export volumes, many reported the summer to 2.9m tonnes by the end of 2007.
sluggishness creeping into their export trades.
China has also been increasing its inorganic exports
US inorganic exports were in the category that were consistently. Overall exports for inorganic chemical
slightly affected by the conventional seasonal slowdown. commodities were only 0.8m tonnes. In 2006 the total
Table 2.21 USA: inorganic chemical exports ('000 tonnes)
Destination L.Am Aust Eur W. Af SE Asia Other Total
2002 1,473 207 198 87 27 36 2,028

2003 2,010 382 79 15 17 23 2,525
2004 2,085 238 25 31 38 30 2,448
2005 2,190 187 44 89 64 15 2,589
2006 2,479 100 117 71 24 31 2,822
2007e 2,938 2 74 106 88 20 3,228
4Q05 495 30 13 18 13 2 571

1Q06 640 1 9 11 9 3 673
2Q06 615 30 35 1 6 1 688
3Q06 590 n/a 21 40 4 3 658
4Q06 634 69 52 19 5 24 803
1Q07 789 0 16 17 17 4 843
2Q07 680 1 21 36 27 6 771
Source: Drewry
Table 2.22 China: inorganic chemical exports ('000 tonnes)
Destination SE Asia Aust L.Am Japan N.Af Other Total

2002 169 65 18 12 9 29 302
2003 195 46 14 14 16 30 316
2004 211 45 6 15 3 41 320
2005 343 273 42 23 15 108 804
2006 542 276 35 237 6 178 1,274
2007e 500 338 34 322 8 226 1,428
4Q05 90 87 23 3 2 33 238
1Q06 102 68 3 33 1 17 224
2Q06 133 52 24 42 1 37 289
3Q06 160 44 5 63 2 48 322
4Q06 170 112 4 98 2 54 440
1Q07 111 53 12 82 2 45 305
2Q07 139 116 5 79 2 68 409
Source: Drewry

3Q2007
Table 2.23 Japan: inorganic chemical exports ('000 tonnes)
Destination Aust SE Asia N.Am L.Am S.Af Other Total

2002 786 1,216 113 347 22 75 2,559
2003 868 1,120 162 199 0 34 2,385
2004 899 1,042 116 81 0 26 2,164
2005 1,094 1,205 249 164 0 31 2,743
2006 1,219 1,385 280 136 21 208 3,249
2007e 1,114 1,356 292 434 0 268 3,464
4Q05 316 274 63 29 0 26 708

1Q06 364 309 97 29 0 52 851
2Q06 245 421 80 50 0 80 876
3Q06 364 357 68 28 0 42 859
4Q06 246 298 35 29 0 55 663
1Q07 273 352 68 120 0 66 879
2Q07 284 326 78 97 0 68 853
Source: Drewry
increased to 1.3m tonnes. With rising domestic 2.3.2 Imports

production of several inorganic chemicals exports are
likely to touch 1.4m tonnes by the end of 2007. Even though US inorganic exports suffered a mild
slowdown during 2Q07, inorganic imports continued to
Another important exporter of inorganic chemicals, flow in large quantities.
Japan is also likely to consolidate its position as a key
exporters during 2007. Total inorganic exports for 2007 During 2Q07, US inorganic imports more than doubled
are forecast at 3.5m tonnes, compared with 3.2 million and were estimated at 0.4m tonnes.
tonnes in 2006.
Table 2.24 USA: inorganic chemical imports ('000 tonnes)
Source Eur SE Asia Japan Mid East L.Am Other Total

2002 380 309 77 63 144 56 1,029
2003 411 375 112 89 184 47 1,218
2004 494 323 118 27 227 43 1,232
2005 499 451 178 18 576 65 1,787
2006 571 637 221 19 284 31 1,763
2007e 272 450 190 8 300 182 1,402
4Q05 181 141 59 4 169 47 601

1Q06 179 173 96 4 99 1 552
2Q06 125 186 20 5 56 3 395
3Q06 138 144 71 5 60 12 430
4Q06 129 134 34 5 69 15 386
1Q07 50 115 45 0 80 1 291
2Q07 86 110 50 4 70 90 410
Source: Drewry

3Q2007
Table 2.25 China: inorganic chemical imports ('000 tonnes)
Source SE Asia Japan N.Am Eur Aust Other Total
2002 1,127 795 1 1 0 6 1,992

2003 1,241 758 1 1 0 13 2,051
2004 1,194 682 1 1 0 0 1,915
2005 1,300 709 1 1 0 0 2,058
2006 1,310 893 0 0 0 1 2,204
2007e 1,162 898 0 0 0 2 2,062
4Q05 357 148 0 0 0 0 505

1Q06 350 188 0 0 0 0 538
2Q06 347 307 0 0 0 0 654
3Q06 337 260 0 0 0 0 597
4Q06 276 138 0 0 0 1 415
1Q07 293 254 0 0 0 0 547
2Q07 288 195 0 0 0 1 484
Source: Drewry
2.4 Seaborne trade estimate the total seaborne chemical trade during 2006
at 154.9m tonnes.
Our definitions of seaborne chemical trade are based on
four main product groups, which are: Also, the provisionally available data for 2007 suggests
that seaborne trade is likely to grow by 2.8% from 2006
Organic chemicalsG to 2007 and therefore our forecasts for 2007 points to
total trade of 159.3m tonnes.
Inorganic chemicalsG
Veg oils/animal fatsG The increase is expected on the back of another leap in
the volume of organic seaborne trade movements, from
Other products – molasses and G
74.5m tonnes in 2006 to 77.7m tonnes in 2007. Vegoils
lubricating oils.
total seaborne trade is expected to rise from 45.4m
tonnes in 2006 to 46.3m tonnes in 2007.
Within the organic group we have individual trade
assessments for nineteen major products, plus
estimated numbers for sub product groups, such as drug Growth from 2001 - 2006
store and contract chemicals. (%)
Organic chemicals 6.11%

For inorganic chemicals we have individual trade
Inorganic chemicals 20.80%
assessments for four main products, plus an ‘other’
Veg oils/animal fats 38.69%
category.
Other products 8.20%
Our coverage of veg oils/animal fats extends to the All products 16.50%
major products, and in the ‘other’ category we have
individual assessments for two products – molasses and
lubricating oils. Moving ahead, we still continue to hold an optimistic
view for the chemical demand and trade. Also, over the
2.4.1 Total trade forecast period, from 2008-11, we expect the overall
trade volumes to move upwards. Our long term
In our current publication, trade estimates for 2006 have forecasts suggest that the overall seaborne trade is
been revised upwards, mainly due to inclusion of some likely to touch 171.4m tonnes by 2009 and 181.8m
more recently available data. At the moment, we tonnes by the end of 2011.

3Q2007
Figure 2.9 Seaborne trade growth by chemical group (million tonnes)
Organic chemicals Inorganic chemicals

80 20
70 15
10
60
5
50
0
84 86 88 90 92 94 96 98 00 02 04 06
40
50 Veg oils/animal fats
30
40
30
20
20
10
10
0 0
84 86 88 90 92 94 96 98 00 02 04 06 84 86 88 90 92 94 96 98 00 02 04 06
Source: Drewry
Table 2.26 Seaborne chemical trade (million tonnes)
Organics Inorganics* Veg/Animal Oils & Fats Other Cargoes** Total Trade
2001 70.2 15.6 32.8 14.8 133.0

2002 65.5 15.1 37.1 15.0 132.7
2003 68.6 15.8 39.7 15.2 139.3
2004 70.5 15.7 40.7 15.7 142.6
2005 72.2 17.5 43.1 15.7 148.5
2006 74.5 18.9 45.4 16.0 154.9
2007 77.7 19.0 46.3 16.2 159.3
2008
forecast
81.2 19.6 48.2 16.3 165.3

2009 84.9 20.1 49.7 16.7 171.4
2010 88.7 20.7 51.2 17.0 177.6
2011 90.9 21.1 52.7 17.2 181.8
* Three main inorganic chemicals only - phosphoric acid, sulphuric acid, caustic soda solution
** Estimate of trades in "other" cargoes e.g. lube oils, potable alcohols etc.
Source: Drewry

3Q2007
Table 2.27 Intra regional seaborne trade flows ('000 tonnes)
Organic 2002-2007e 2002 2003 2004 2005 2006 2007e
Intra SE Asia (inc Japan) 14,483 15,272 15,200 17,198 17,962 19,579
North America SE Asia (inc Japan) 4,321 6,275 7,886 6,163 4,477 5,408
Middle East SE Asia (inc Japan) 6,474 6,362 6,356 7,431 7,549 7,775
Latin America North America 5,989 5,390 6,050 8,128 8,413 7,915
Australasia Rest of World 1,200 800 600 400 100 100
North America Latin America 3,707 4,161 4,428 4,365 5,596 5,805
Middle East North America 1,827 1,691 1,317 1,243 585 289
North America OECD Europe 2,255 2,356 2,108 1,909 3,638 3,965
Total 40,257 42,307 43,945 46,837 48,320 50,837
Inorganic 2002-2007e 2002 2003 2004 2005 2006 2007e
Intra SE Asia (inc Japan) 4,703 4,840 4,671 5,089 5,679 5,395
North America Latin America 1,526 2,042 2,082 2,241 2,508 2,940
North Africa South Asia 1,276 1,079 1,078 1,129 1,309 1,100
North Africa OECD Europe 916 1,019 1,043 893 857 857
North America Australasia 259 382 238 188 100 3
OECD Europe North America 418 434 463 477 560 285
SE Asia (inc Japan) Australasia 1,348 1,298 1,517 2,108 2,417 2,652
Latin America OECD Europe 87 83 80 115 115 115
Total 10,533 11,176 11,172 12,240 13,545 13,347
Veg oils/animal fats 2002-2007e 2002 2003 2004 2005 2006 2007e
Intra SE Asia (exc Japan) 3,885 5,011 6,063 6,433 6,950 6,950
SE Asia (exc Japan) South Asia 5,329 5,974 5,042 5,494 5,232 5,232
SE Asia (exc Japan) OECD Europe 3,815 3,885 4,060 4,640 4,859 4,576
South Asia OECD Europe 1,543 1,376 1,251 607 659 696
Latin America SE Asia (exc Japan) 1,268 2,746 2,651 2,405 2,038 2,038
North America Latin America 1,345 1,198 1,082 1,020 1,020 880
SE Asia (exc Japan) North America 905 816 995 1,099 1,427 1,480
Intra Latin America 704 685 827 931 601 601
Total 18,794 21,691 21,971 22,629 22,786 22,453
Source: Drewry

3Q2007
2.4.2 Organic trade → North America – Latin America trade route is

expected to see 5.8m tonnes of organic chemical
The principal intra regional organic seaborne trade cargo during 2007.
estimates for 2007 have been revised and are now
placed at 50.8m tonnes.
2.4.3 Inorganic trade
→ Intra South East Asia (including Japan) trade
zone is expected to continue to be the busiest Annual seaborne trade estimates for principal intra
route for the organic chemicals during 2007, regional inorganic seaborne trade routes during 2007
with trade movements pegged at almost 19.6m is placed at 13.3m tonnes.
tonnes.
→ Intra South East Asia (including Japan)
→ Latin America – North America trade lane is zone is expected to continue as the most active
expected to follow suit, with expected annual trading region for inorganic seaborne trade during
organic trade of 7.9m tones. G 2007. Our trade estimates suggest that in 2007,
5.4m tonnes of inorganic cargo is likely to be
→ Middle East – South East Asia (including Japan) moved. G
trade leg is expected to be the third busiest trade
route during 2007, with the year end tally of organic → The second busiest trade route during 2007 is
exports currently estimated at 7.8m tonnes. expected to be the North America – Latin
America trade zone. Almost 2.9m tonnes of
inorganic chemical cargo is anticipated to be
traded on the route during the year.
Figure 2.10 India organic chemical exports
by country, 2006
→ The third busiest trade route is expected to be
('000 tonnes)
South East Asia (including Japan) - Australasia
which is likely to experience trade movements to
Indonesia
the tune of 2.7m tonnes during 2007.
China
Singapore
Malaysia
2.4.4 Veg oils/animal fats
Saudi Arabia
United States Principal intra-regional trade estimates for 2007
UAE suggest that almost 22.4m tonnes of veg oils/fats is
Other likely to be traded during the year.
Source: Drewry
→ Intra South East Asia (excluding Japan)
zone is pegged to be the most active trading region
for veg oils during 2007, at almost 7.0m tonnes. In
Figure 2.11 India: organic chemical imports
2006, the same volumes had been moved from the
by country, 2006
region. G
('000 tonnes)
→ The second spot for highest trade volumes is

Singapore
expected to be taken by South East Asia
Saudi Arabia
(excluding Japan) – South Asia at 5.2m tonnes.
Qatar
This too is expected to be, similar to the vegoil
Iran
cargoes moved during 2006.
United States
Malaysia
The South East Asia (excluding Japan) – OECD
Kuwait
Europe trade zone is expected to be the third busiest
Other
Source: Drewry trade route, at 4.6m tonnes of expected trade volumes.

3Q2007
Table 2.28 Total seaborne trade – bulk liquid chemicals and associated products
'000 Tonnes
Product Group Product 2000 2005
Organics Acetic Acid 924 1,460
Acetone 337 1,500
Acrylonitrile 954 1,300
Benzene including heart cut benzene 4,868 3,900
Butanols/propanols/hexanols etc 1,100 1,250
Cumene 575 730
Cyclohexane 828 1,350
EDC 2,563 2,200
Ethylene Glycol 5,720 7,050
Ethanol 2,838 3,800
Methanol 17,460 19,243
Xylenes/incldg Paraxylene 4,588 4,500
MTBE 7,069 5,650
Phenol 512 695
Proponals 551 630
Styrene 2,433 2,600
Toluene 953 1,250
Urea Ammonium Nitrate 1,700 1,850
Vinyl Acetate Monomer 1,026 1,042
Other Organics
Total Named Chemicals 57,000 62,000
Paraffins incldg wax 791 650
Drug store contract chemical parcels 2,468 2,100
Pyrolysis Gasoline 1,202 1,589
Nylon Salt 570 500
Oleochemicals 2,980 2,289
Other Organics 2,331 3,872
Total Other Products 10,600 11,000
Total Organics (revised) 67,600 73,000
Inorganics Calcium Carbonate Slurry 1,900 2,000
Caustic Soda 4,800 4,999
Phosphoric Acid 5,800 5,924
Sulphuric Acid 2,200 2,700
Other inorganics 500 777
Total Inorganics 15,200 16,400

3Q2007
Table 2.28 Total seaborne trade – bulk liquid chemicals and associated products (cont’d)
'000 Tonnes
Product Group Product 2000 2005
Veg Oils/Fats Castor oil 238 246
Cocunut Oil 1,506 2,177
Corn Oil 500 500
Cottonseed oil 200 200
Fish Oil 703 561
Groundnut oil 239 246
Lard 100 100
Linseed Oil 100 100
Olive oil 500 400
Palm Kernel 1,321 1,763
Palm Oil 13,745 23,676
Rapeseed 1,843 1,172
Sesame Oil 20 25
Soyabean 6,489 8,377
Sunflower 2,389 2,367
Tallow Grease 1,453 1,367
Total Veg Oils/Fats 31,346 43,277
Other Products Molasses 5,652 6,450
Lubricating oils 9,302 9,250
Total Other Products 14,954 15,700
All Products Total Trade 129,100 148,377
Source: Drewry

26
3Q2007
chemical forecaster chemical tanker shipping
3. Chemical tanker shipping Chemical tanker demand can be measured in tonne

miles – a simple arithmetical product of trade volumes
multiplied by the distance between load and discharge
3.1 Chemical tanker demand ports, or in dwt.
Methodology In the case of dwt, demand is derived by applying a set

of ratios of between tonne mile demand and fleet
The absolute volume and pattern of trade determine utilisation levels for individual vessel categories.
chemical tanker demand. The cargoes which are used in
the calculations of chemical tanker demand are: In an ideal world the fleet would always be working at
peak efficiency. However in real life, it is difficult to
x Organic chemicals envisage a situation where this is possible for prolonged
periods, as voyage and operational inefficiencies,
x Inorganic chemicals
coupled with various other factors tend to lead to
x Veg oils and fats utilisation or productivity levels being below optimum.
x Other products (molasses & lubes)

Utilisation can therefore be largely classified as the
efficiency with which the fleet operates at a given point
The above cargoes are regulated under the International in time. In all ship operations there is a degree of
Bulk Chemical Code (IBC) chapters 17 and 18 and inefficiency contained in activities such as: port delays,
MARPOL Annex II. part cargoing, slow steaming or time spent in waiting
for cargo etc. So, it would be rare for the market to
Hence we have excluded from our estimates demand witness utilisation levels in excess of 95% of capacity,
arising from the movement of other cargoes which even in the strongest of markets, as was the case in
provide some employment for ships covered by our 2005.
definition of the chemical fleet (see Section 3.2). In the
main the excluded cargoes are: Thus in making forward projections of demand some
assessments have to be made of likely levels of
o Clean petroleum products (e.g. gasoline, gas oil, utilisation, which are in the main the “subjective” part of
aviation fuel, including distillates and base oils) the forecast.
The bulk of which are carried by non-IMO tankers (also Demand

termed as product tankers) in the clean petroleum
tanker trade and are regulated under SOLAS/MARPOL With some more recent data available, we have revised
Annex I. the demand values for 2006, to 528.5 billion tonne miles.
Table 3.1 Chemical tanker employment* – tonne miles (billion)
Organics Inorganics Veg Oils Other Total

Products
2002 184.5 32.6 149.4 43.2 409.7
2003 187.6 32.9 160.1 43.8 424.3
2004 190.0 55.2 177.6 45.0 467.8
2005 199.5 63.4 188.1 46.8 497.9
2006 216.0 66.4 198.2 47.9 528.5
2007 225.3 66.8 202.2 53.4 547.7
forecast
2008 235.4 68.8 210.3 51.5 566.0

2009 246.0 70.7 217.0 52.7 586.4
2010 257.1 72.5 223.5 58.5 611.6
2011 263.5 74.1 229.8 59.5 626.9
* Employment generated by trade in liquid chemicals and vegetable oils/fats and other products such as molasses.
Excludes employment in CPP trades.
Source: Drewry

3Q2007
Figure 3.1 Chemical carrier fleet development When translated into deadweight terms, our demand
('000 dwt) estimates suggest the following trend.
Demolition Deliveries Fleet (Right axis) In 2007, demand for chemical tankers is estimated at
12,000 90,000 40.0m dwt, some 4.0m dwt above 2006.
10,000
80,000
8,000 Looking forward, demand is projected to increase to
6,000 70,000 43.1m dwt in 2009 and to 47.5m dwt by the end of 2011.
4,000
2,000 60,000
Sector wise demand is expected to grow the fastest in
0 the following sectors:
50,000
-2,000
-4,000 40,000 o 30,000+ dwt vessel sizes are expected to
02 03 04 05 06 07 08 09 10 11
experience demand growth from 22.8m dwt in 2007
Source: Drewry
to 25.4m dwt in 2011.
o 10-20,000 dwt vessel sizes are expected to

In 2007, tonne mile demand is expected to receive a experience demand growth from 6.5m dwt in 2007
further positive impetus, as demand for organic chemical to 9.0m dwt in 2011.
commodities is expected to rise by 4.3% to 225.3 billion
tonnes. The overall tonne mile demand for 2007 for 3.2 Chemical tanker supply
chemical carriers is also expected to increase by 3.8%,
at 547.7 billion tonnes. All fleet data is based on the situation as of the last day
of the quarter under discussion. Therefore, our Fleet
In the period 2007 to 2011, the tonne mile demand is List as of 30th September 2007 has been used as a
expected to rise by an annual average of 3.5% (adjusted basis for all calculations and market analysis in this
slightly downwards since our previous estimates). As publication.
such, our current forecasts suggest that in 2008, the
tonne mile demand is likely to reach 566.0 billion, rising There are still more changes in the fleet composition
to 629.9 billion tonne miles in 2011. between chemical and CPP utilisation. More ships are
turning up to load IMO cargoes when they were thought
Demand in this context relates specifically to the to be pure product tankers. These changes are
employment generated from trading in liquid chemicals reflected in the tables. This will be an ongoing process
and related products, and therefore excludes refined as even more ships are converted to IMO Class and
petroleum products. more classifications are clarified.
Table 3.2 Chemical tanker demand* (million dwt)
Size (Dwt) 1-5,000 5-10,000 10-20,000 20-30,000 30,000+ Total
2002 1.4 3.6 3.0 3.6 9.9 21.5

2003 1.5 3.8 3.5 3.6 10.3 22.7
2004 1.5 3.8 3.5 3.8 19.5 32.1
2005 1.7 4.4 4.4 4.1 19.0 33.6
2006 1.6 4.3 5.1 4.7 20.3 36.0
2007 1.8 4.6 6.5 4.7 22.8 40.0
forecast
2008 1.8 4.8 6.9 4.8 23.4 41.7

2009 1.8 4.9 7.3 5.0 24.1 43.1
2010 1.9 5.1 8.4 5.1 24.5 45.0
2011 1.9 5.3 9.0 5.1 25.4 47.5
* Employment generated by trade in liquid chemicals and vegetable oils/fats and other products such as molasses.
Excludes employment in CPP trades.
Source: Drewry

3Q2007
Fleet definitions & ship types There are still a number of ships being converted to
Double Hull (see Appendix) and it is difficult to determine
In defining our fleet, reference has to be made to the if these conversions are to give a ship IMO class or to
different ship types with chemical and related cargo prepare them for the implementation of Annex 1 in
capacity. Thus we include: 2010. We are only changing the DC Code for converted
ships once we have confirmation that the conversion is
x IMO rated chemical tankers complete and that they have IMO class. Some are being
x Non-IMO tankers converted to full IMO II status while others are converted
solely for vegetable oil carriage and converting to IMO III
The definition between IMO and Non-IMO tankers is with the additional equipment to allow them to obtain
based on the classification of each ship. Many of these dispensation under the IMO ruling.
are still unclear. However, some ships defined in
records as Chemical and Product Tankers are found to Within the five main categories of vessels, each group is
have no IMO classification and are thus not able to carry subdivided to reflect whether the ship is currently trading
chemicals or vegetable oils, whereas some defined as in chemicals or in clean petroleum products. The non-
Product Tankers, or even as Crude Oil Tankers are IMO tankers however are no longer subdivided but are
found to have a basic IMO III classification, allowing assumed to be carrying clean petroleum products for the
them to carry vegetable oils and some easy chemicals. moment. Last quarter we suggested that elimination of
This means that those non-IMO ships, which we feel this type of ship from our lists by the end of 2007,
could still possibly be IMO ships will remain in our lists however we now believe that they will remain into 2008
for the time being. Throughout this report we refer to unless the pace of change slows down by the last
vegetable oils. This description is used to include all quarter of 2007.
vegetable oils such as Soyabean Oil, Palm Oil etc as
well as the Fats such as Tallow, Lard etc. Although our database includes the details of the cubic
metres for all categories of IMO classed space, we have
Within the overall fleet there are five main categories of added the IMO I space to the IMO II space in all
ship: calculations. There are very few cargoes requiring IMO
I space and most of that space is actually used for IMO
o IMO II: A vessel with all her space IMO I and/or II cargo. The IMO rated ships all have the ability to
IMO II. carry chemicals and/or vegetable oils although many are
o IMO II/III: A vessel with a combination of IMO I/II still carrying clean petroleum products, or in some cases
and IMO III space. dirty petroleum products. The trading status of each
ship is taken into account when allocating the DC codes.
o IMO III DH: A vessel with all IMO III space and with
There is constant change in the use of such ships
a double hull.
depending on the market forces and the duration of
o IMO III Non DH: A vessel with all IMO III space and applicable charters.
with no double hull.
o Non-IMO: A vessel with no IMO space. The definition between IMO class ships trading chemicals
and IMO class ships trading CPP is based on functional
The “chaos” described last quarter seems to continue. trade patterns and can vary from quarter to quarter.
Some ships that were not included in our figures are
now loading vegetable oils and are converted to Double The Drewry definition codes, (DC Codes) are as follows:
Hull, or upgraded to IMO Class during their drydocking.
It seems as if the derogation granted by IMO/MARPOL Drewry's definition codes
for Double Hull IMO III ships to carry vegetable oils has
been taken full advantage of. The result has been a A = IMO II trading chemicals and vegetable oils
small oversupply of larger ships in this category. AA = IMO II trading CPP (or DPP)
B = IMO II/III trading chemicals and vegetable oils
Although we still believe that the situation will stabilise C = IMO II/III trading CPP (or DPP)
over the next few months, it now seems as if the D = IMO III double hull trading chemicals and vegetable oils
confusion will continue, at least until the end of the year. E = IMO III double hull trading CPP (or DPP)
As mentioned last quarter, we are leaving the non-IMO F = IMO III non-double hull trading chemicals and vegetable oils
classed ships in the assessments. When the confusion G = IMO III non-double hull trading CPP (or DPP)
is resolved, we will remove the non-IMO ships from our H = Non-IMO ships regardless of trade
figures.

3Q2007
From this breakdown, we are able to derive two sets of The non-IMO fleet declined very slightly as one ship was
figures representing: scrapped and another had been converted to IMO class.
The Double Hull IMO 3 fleet increased by 5.8% due to
o The “Pure Chemical Fleet”. i.e. the IMO rated fleet deliveries and conversions, while the non-double hull
trading in chemicals and vegetable oils. IMO 3 fleet decreased by 4.4% as ships were scrapped
or converted to double hull.
o The Chemical capable Clean Petroleum product
fleet and the Non-IMO fleet. The overall impact of these changes is an increase of
5.0% in the total deadweight of IMO classed tonnage
In spite of an increasing trend towards age limitation available, an increase of 97 ships.
by countries such as India and China, as well as from
several major charterers, there are still older ships Orderbook
being converted for chemical and vegetable oil trades.
There are three ships above 75,000 dwt that are over So far in 2007 there have been 234 ships of 5.7m dwt
20 years old converted and now suitable for vegetable delivered and there are 278 ships of 5.3m dwt still due,
oils plus a sister ship a little younger. The effect of the for delivery in 2007.
conversions has resulted in the increase of the January
1st 2007 fleet by 80 ships of 1.4m dwt as these ships We believe that many will be rolled into 2008 or later as
are retroactively added to the fleet (see Tables 3.10 delays in yards seem to be on the increase, especially
and 3.11). from China. There are a number that were ordered for
2005 or 2006 delivery and we expect some of these to
The situation is not expected to be completely clarified be cancelled.
until into 2008. The Non IMO class ships are retained in
the listings but are now assumed to be trading solely in We also fear there may be some duplication. Some
petroleum products and not chemicals or vegetable oils. ships are reported as being ordered for an owner who is
not actively trading chemical tankers, while similar sized
In 3Q07, the fleet grew by 3.7% over the previous ships, from the same yards will be announced by major
quarter, and while deliveries were slightly up on the operators.
previous quarter, they only accounted for 3.0%, the rest
of the increase coming from ships outside our listings Some of these are possibly ordered for long time charter
that were converted. The fully IMO II ships’ deadweight to the major operators and may cause the duplication.
has increased by 6.8% in the quarter while the IMOII/III While every care is taken to minimise this, it is often only
deadweight increased by one 2,000 dwt ship discovered when the IMO number is allocated and announced by
trading locally and now moving into wider trading areas. both parties that this becomes apparent.
Table 3.3 The total chemical tanker fleet (‘000 dwt)
Size (Dwt) 1-5,000 5-10,000 10-20,000 20-30,000 30,000+ Total
No. '000 No. '000 No. '000 No. '000 No. '000 No. '000
Dwt Dwt Dwt Dwt Dwt Dwt
2002 515 1,555 529 4,582 487 7,279 162 4,267 568 22,931 2,261 40,614
2003 527 1,599 648 4,717 491 7,366 165 4,359 634 25,689 2,465 43,730
2004 546 1,666 665 4,831 497 7,470 168 4,441 734 29,947 2,610 48,355
2005 563 1,525 669 4,859 502 7,546 179 4,499 831 34,138 2,744 52,567
2006 626 1,933 696 5,059 579 8,655 182 4,781 981 40,687 3,064 61,115
2007* 699 2,174 732 5,337 662 9,902 187 4,932 1,078 45,355 3,358 67,700
* September 2007
Source: Drewry

3Q2007
Table 3.4 Total chemical tanker fleet by type/trading status: September 2007
Size (Dwt) 1-5,000 5-10,000 10-20,000 20-30,000 30,000+ Total
Type / Trading No. '000 Dwt No. '000 Dwt No. '000 Dwt No. '000 Dwt No. '000 Dwt No. '000 Dwt
IMO 2
Chemicals 304 939 330 2,497 396 5,985 74 1,863 199 7,931 1,303 19,216
CPP/Veg Oils 31 106 18 129 38 578 7 174 31 1,263 125 2,251
Total 335 1,046 348 2,626 434 6,564 81 2,038 230 9,194 1,428 21,467
IMO2/3
Chemicals 78 245 109 830 67 941 33 825 48 1,773 335 4,613
CPP/Veg Oils 10 26 12 76 3 39 1 23 8 316 34 480
Total 88 271 121 906 70 980 34 848 56 2,088 369 5,093
IMO 3 DH
Chemicals 70 268 56 390 34 502 6 155 110 4,730 276 6,044
CPP/Veg Oils 17 59 29 206 35 509 15 428 398 16,951 494 18,152
Total 87 327 85 596 69 1,011 21 583 508 21,680 770 24,196
IMO 3 NDH
Chemicals 74 210 77 528 28 441 13 361 8 352 200 1,892
CPP/Veg Oils 23 58 29 196 15 204 9 255 11 459 87 1,172
Total 97 268 106 724 43 645 22 616 19 811 287 3,064
Total IMO
Chemicals 526 1,662 572 4,244 525 7,869 126 3,204 365 14,786 2,114 31,765
CPP/Veg Oils 81 249 88 607 91 1,331 32 881 448 18,988 740 22,055
Total 607 1,911 660 4,851 616 9,199 158 4,085 813 33,774 2,854 53,820
Non IMO
Chemicals 92 263 72 486 46 703 29 847 265 11,581 504 13,880
CPP/Veg Oils
Total 92 263 72 486 46 703 29 847 265 11,581 504 13,880
Total Fleet
Chemicals 526 1,662 572 4,244 525 7,869 126 3,204 365 14,786 2,114 31,765
CPP/Veg Oils 173 511 160 1,093 137 2,033 61 1,728 713 30,569 1,244 35,935
Total 699 2,174 732 5,337 662 9,902 187 4,932 1,078 45,355 3,358 67,700
Source: Drewry

3Q2007
Table 3.5 Total chemical tanker orderbook* development (‘000 dwt)
Size (Dwt) 1-5,000 5-10,000 10-20,000 20-30,000 30,000+ Total %

No. '000 No. '000 No. '000 No. '000 No. '000 No. '000 Fleet
2006 66 237 127 881 324 5,023 21 507 372 16,128 910 22,776 39.3%
2007** 69 269 192 1,375 401 6,223 47 1,165 370 16,131 1,079 25,164 37.2%
1Q06 67 248 70 500 287 4,406 18 457 309 13,234 751 18,845 32.1%
2Q06 71 255 109 753 308 4,717 21 507 368 15,996 877 22,228 37.1%
3Q06 72 262 124 856 308 4,722 21 507 369 16,063 894 22,410 37.8%
4Q06 66 237 127 881 324 5,023 21 507 372 16,128 910 22,776 37.3%
1Q07 72 279 173 1,239 352 5,430 25 625 378 16,342 1,000 23,915 37.7%
2Q07 64 240 177 1,226 370 5,649 30 713 365 15,800 1,006 23,628 36.2%
3Q07 69 269 192 1,375 401 6,223 47 1,165 370 16,131 1,079 25,164 37.2%
* Includes both chemical (IMO) and non-IMO ships with both chemical and related product capacity
** Year to date
Source: Drewry
As one looks into the future, there are only 2 ships deliveries in 3Q07 and partly from ships changing to
below 5,000 dwt for delivery after 2008, 46 between IMO 3 category.
5,000 and 10,000 dwt and then 160 ships between
10,000 and 20,000 dwt. The reason is that the smaller The high cost of stainless steel and the increasing use
ships need much shorter lead times and we would of marine line coatings have resulted in some major
expect the numbers to increase, even for 2008 delivery, operators ordering coated rather than stainless tonnage.
as time goes on. Stolt-Nielsen, Odfjell and MISC all have larger coated
but sophisticated tonnage on order. Odfjell have even
The 2Q07 figure of 70 ships of 3.0m dwt included in our declined to take up the option for the last two ships from
orderbook that are listed as non-IMO (DC Code H) have the yard in Poland in favour of the coated ships to come
decreased to 56 ships of 2.5m dwt in 3Q07, partly due to from Russia.
Table 3.6 Total chemical tanker orderbook by type and expected employment status
2007 2008 2009 2010+ Total

Size (Dwt) No. '000 Dwt No. '000 Dwt No. '000 Dwt No. '000 Dwt No. '000 Dwt
IMO 2 - Chem 142 1,771 192 3,101 155 3,546 123 3,750 612 12,168
IMO 2 - CPP 21 238 12 139 13 198 11 280 57 855
IMO 2/3 - Chem 0 0 0 0 0 0 0 0 0 0
IMO 2/3 - CPP 0 0 0 0 0 0 0 0 0 0
IMO 3 DH - Chem 46 825 76 2,018 46 1,459 8 254 176 4,555
IMO 3 DH - CPP 47 1,351 63 1,612 39 932 29 1,151 178 5,045
IMO 3 Non DH - Chem 0 0 0 0 0 0 0 0 0 0
IMO 3 Non DH - CPP 0 0 0 0 0 0 0 0 0 0
Non IMO - Chem/CPP 24 1,144 22 931 10 466 0 0 56 2,541
Total 280 5,328 365 7,801 263 6,600 171 5,435 1,079 25,164
Employment (anticipated):
Chemicals 188 2,595 268 5,119 201 5,005 131 4,004 788 16,723
CPP 92 2,733 97 2,682 62 1,595 40 1,431 291 8,441
Source: Drewry

3Q2007
Table 3.7 Chemical tanker deliveries*
Size (Dwt) 1-5,000 5-10,000 10-20,000 20-30,000 30,000+ Total

No. '000 No. '000 No. '000 No. '000 No. '000 No. '000
2002 14 51 31 227 22 344 6 154 58 2,399 131 3,175
2003 26 86 44 325 34 568 8 204 97 4,025 209 5,208
2004 31 111 38 289 35 542 11 274 136 5,755 251 6,971
2005 46 160 45 313 49 756 11 292 114 4,953 265 6,474
2006 47 163 25 193 87 1,257 11 286 126 5,529 296 7,428
2007 80 309 87 641 174 2,576 11 277 162 7,213 514 11,017
forecast
2008 16 59 88 634 143 2,228 6 148 112 4,731 365 7,800

2009 2 8 37 260 117 1,855 12 295 95 4,182 263 6,600
2010 0 0 3 19 39 604 24 600 67 2,917 133 4,140
2011 0 0 4 26 4 65 1 25 27 1,166 38 1,295
1Q06 8 31 3 22 17 247 6 153 34 1,495 68 1,948

2Q06 16 49 9 65 19 262 4 103 29 1,280 77 1,759
3Q06 13 43 4 31 15 216 1 30 31 1,321 64 1,641
4Q06 10 40 9 65 36 542 0 0 31 1,381 86 2,028
1Q07 13 48 11 84 23 356 2 54 29 1,282 78 1,824
2Q07 8 32 6 42 28 405 3 76 31 1,366 76 1,920
3Q07 8 28 12 93 25 345 2 50 33 1,429 80 1,945
Source: Drewry
Figure 3.2 Fleet* age profile, September 2007 (dwt)
8,000,000
7,000,000
6,000,000
30,000+
5,000,000
20-30,000
4,000,000 10-20,000
5-10,000
3,000,000 1-5,000
2,000,000
1,000,000
0
1979 1983 1987 1991 1995 1999 2003 2007
* Age profile of total chemical fleet.

Source: Drewry

3Q2007
Table 3.8 Total chemical tanker fleet* age profile: September 2007
1-5,000 dwt 5-10,000 dwt 10-20,000 dwt 20-30,000 dwt 30,000+ dwt Total
<==1976 91 238 35 248 9 134 3 82 11 371 149 1,073
1977 13 32 4 28 3 52 3 79 1 32 24 223
1978 14 51 10 69 2 29 2 51 6 208 34 408
1979 11 30 6 40 3 39 0 0 5 200 25 309
1980 23 54 24 164 10 149 3 80 7 268 67 715
1981 22 71 32 218 10 154 6 149 15 541 85 1,132
1982 13 44 11 81 22 289 18 460 25 1,009 89 1,882
1983 12 31 23 160 10 166 9 226 20 765 74 1,347
1984 15 48 35 237 14 234 10 268 12 513 86 1,299
1985 13 27 43 309 27 403 5 146 18 794 106 1,679
1986 13 26 9 67 14 213 15 423 19 859 70 1,588
1987 14 32 7 42 6 84 4 112 15 708 46 977
1988 12 30 12 87 12 190 4 109 12 514 52 930
1989 15 42 11 87 9 141 4 119 10 450 49 839
1990 17 42 15 115 6 90 6 179 7 338 51 763
1991 24 76 24 179 7 104 8 227 10 388 73 974
1992 29 96 26 197 11 139 4 113 14 539 84 1,084
1993 22 62 10 83 15 204 4 103 7 272 58 724
1994 25 75 16 133 10 139 1 30 10 368 62 745
1995 11 36 17 129 14 203 1 29 14 577 57 975
1996 19 64 19 144 14 186 1 28 33 1,308 86 1,730
1997 13 48 23 160 23 320 1 29 25 1,027 85 1,583
1998 15 59 36 276 32 460 1 22 33 1,368 117 2,185
1999 12 41 25 183 41 609 4 88 43 1,842 125 2,763
2000 18 65 18 127 24 391 7 162 40 1,642 107 2,388
2001 15 59 22 158 16 260 7 168 44 1,724 104 2,369
2002 14 50 31 227 22 345 6 154 58 2,399 131 3,175
2003 28 91 44 325 34 568 8 204 96 3,992 210 5,181
2004 31 113 39 295 35 542 12 304 134 5,690 251 6,943
2005 50 172 46 324 47 727 12 321 115 4,996 270 6,540
2006 46 161 30 228 84 1,236 11 287 126 5,577 297 7,488
2007 * 29 108 29 218 76 1,106 7 180 93 4,077 234 5,689
Total 699 2,174 732 5,337 662 9,902 187 4,932 1,078 45,355 3,358 67,700
* Includes all ships currently able to carry chemicals and associated products.
Source: Drewry

3Q2007
Figure 3.3 Percentage by type of fleet (by dwt) With today’s orderbook running at 37.2% of the existing
fleet and only 8.5% of the existing fleet being 25 years
10% or older, the size of the fleet is set to increase
0%0%
20% continually over the next few years. Shipbuilding
standards have been steadily improving allowing owners
to expect a longer trading life and to press for fewer age
restrictions.
18% The standards of maintenance are also higher but are a

49%
0% 0% 3% key to the life of a tanker. Age restrictions are not
necessarily the answer; the standard of maintenance
IMO 2 IMO 2 CPP IMO 2/3 from a first class operator can mean a 30 year old ship
IMO 2/3 CPP IMO 3 DH IMO 3 DH CPP is in better condition than a 10 year old ship in other
IMO 3 Non DH IMO 3 Non DH CPP Non IMO hands for maintenance.
Demolition
At the end of the quarter, there was a massive order for
20 ships of 25,000 dwt each for delivery mainly in 2010, The pace of scrapping seems to have slowed down, 27
this order was from two different owners, Capital Ship ships in 1st Quarter, 12 in 2nd Quarter and only 4 in 3rd
Management ordering 12 and Blystad ordering 8 Quarter. There are 10 ships reported as sold for scrap
vessels. This has not been a popular size but the but not yet delivered to the yards. Ships are not
flexibility that the size gives is becoming increasingly a deemed to be scrapped until there is confirmation they
driver over economies of scale. are actually delivered to the yard.
Table 3.9 Chemical tanker demolition* (‘000 dwt)
Size (Dwt) 1-5,000 5-10,000 10-20,000 20-30,000 30,000+ Total
No. '000 No. '000 No. '000 No. '000 No. '000 No. '000
2002 3 11 4 29 0 0 2 50 8 258 17 348

2003 6 16 13 93 4 57 5 125 6 192 34 483
2004 8 29 14 93 10 148 12 331 17 596 61 1,197
2005 8 25 8 54 4 60 5 133 11 372 36 644
2006 10 28 7 51 8 123 11 300 8 269 44 771
2007 105 273 46 328 14 216 14 390 37 1,278 216 2,485
2008
forecast
14 51 10 69 2 29 2 51 6 208 34 408
2009 11 30 6 40 3 39 0 0 5 200 25 309
2010 23 54 24 164 10 149 3 80 7 268 67 715
2011 22 71 32 218 10 154 6 149 15 541 85 1,132
1Q06 6 19 0 0 2 23 3 85 3 101 14 228

2Q06 1 1 2 12 3 51 4 104 1 32 11 200
3Q06 1 2 2 15 1 18 2 58 1 31 7 124
4Q06 2 6 3 24 2 31 2 53 3 105 12 219
1Q07 0 0 5 39 2 29 4 115 16 558 27 741
2Q07 0 0 1 6 0 0 3 84 8 286 12 376
3Q07 1 4 1 7 0 0 1 30 1 31 4 72
Source: Drewry

3Q2007
Table 3.10 Forecast chemical tanker fleet by size
1-5,000 5-10,000 10-20,000 20-30,000 30,000+ Total

'000 '000 '000 '000 '000 '000
Size Category (dwt) No. No. No. No. No. No.
Fleet
Fleet Jan 2007 671 2,070 710 5,171 588 8,825 188 4,981 1,010 42,153 3,167 63,200
- Scrap 105 273 46 328 14 216 14 390 37 1,278 216 2,485
+ Deliveries 79 305 87 641 174 2,576 10 252 162 7,213 512 10,988
Fleet Jan 2008 645 2,102 751 5,484 748 11,186 184 4,844 1,135 48,088 3,463 71,703
- Scrap 14 51 10 69 2 29 2 51 6 208 34 408
+ Deliveries 16 59 88 634 143 2,228 6 148 112 4,731 365 7,801
Fleet Jan 2009 647 2,110 829 6,049 889 13,385 188 4,940 1,241 52,611 3,794 79,095
- Scrap 11 30 6 40 3 39 0 0 5 200 25 309
+ Deliveries 2 9 37 260 117 1,855 12 295 95 4,182 263 6,600
Fleet Jan 2010 638 2,088 860 6,270 1,003 15,201 200 5,235 1,331 56,592 4,032 85,387
- Scrap 23 54 24 164 10 149 3 80 7 268 67 715
+ Deliveries 0 0 3 20 39 604 24 600 67 2,917 133 4,140
Fleet Jan 2011 615 2,034 839 6,125 1,032 15,656 221 5,755 1,391 59,241 4,098 88,812
- Scrap 22 71 32 218 10 154 6 149 15 541 85 1,132
+ Deliveries 0 0 4 26 4 65 1 25 22 965 31 1,082
Fleet Jan 2012 593 1,963 811 5,934 1,026 15,568 216 5,631 1,398 59,665 4,044 88,761
Average Fleet
2007 658 2,086 731 5,327 668 10,005 186 4,912 1,073 45,120 3,315 67,451
2008 646 2,106 790 5,767 819 12,285 186 4,892 1,188 50,349 3,629 75,399
2009 643 2,099 845 6,160 946 14,293 194 5,088 1,286 54,601 3,913 82,241
2010 627 2,061 850 6,197 1,018 15,429 211 5,495 1,361 57,917 4,065 87,099
2011 604 1,999 825 6,029 1,029 15,612 219 5,693 1,395 59,453 4,071 88,786
Source: Drewry

3Q2007
Table 3.11 Forecast chemical tanker fleet by type and employment
Trading Chemicals Trading CPP/Veg Oils Total

Type Category (dwt)
No. '000 Dwt No. '000 Dwt No. '000 Dwt
IMO2
Fleet Jan 2007 1,200 17,640 103 1,884 1,303 19,524

- Scrap 27 100 3 10 30 110
+ Deliveries 245 3,331 43 604 288 3,935
Fleet Jan 2008 1,418 20,871 143 2,478 1,561 23,349

- Scrap 3 20 3 11 6 31
+ Deliveries 192 3,101 12 139 204 3,240
Fleet Jan 2009 1,607 23,952 152 2,606 1,759 26,558

- Scrap 1 3 0 0 1 3
+ Deliveries 155 3,546 13 198 168 3,743
Fleet Jan 2010 1,761 27,495 165 2,804 1,926 30,298

- Scrap 10 92 0 0 10 92
+ Deliveries 97 2,956 8 169 105 3,125
Fleet Jan 2011 1,848 30,359 173 2,973 2,021 33,332

- Scrap 14 232 4 84 18 315
+ Deliveries 19 581 3 111 22 692
Fleet Jan 2012 1,853 30,708 172 3,000 2,025 33,708
IMO 2/3
Fleet Jan 2007 346 4,863 34 480 380 5,343
- Scrap 55 688 14 115 69 803
+ Deliveries 0 0 0 0 0 0
Fleet Jan 2008 291 4,175 20 365 311 4,540

- Scrap 12 256 1 5 13 261
Fleet Jan 2009 279 3,919 19 360 298 4,278

- Scrap 8 142 0 0 8 142
Fleet Jan 2010 271 3,776 19 360 290 4,136

- Scrap 19 223 1 6 20 229
Fleet Jan 2011 252 3,553 18 354 270 3,907

- Scrap 30 358 2 11 32 370
Fleet Jan 2012 222 3,195 16 343 238 3,537

3Q2007
Table 3.11 Forecast chemical tanker fleet by type and employment cont’d

Type Category (dwt)
IMO 3 DH
Fleet Jan 2007 252 5,470 434 15,901 686 21,371

- Scrap 3 45 4 17 7 62
+ Deliveries 70 1,399 107 3,603 177 5,002
Fleet Jan 2008 319 6,824 537 19,487 856 26,311

- Scrap 1 5 0 0 1 5
+ Deliveries 76 2,018 63 1,612 139 3,630
Fleet Jan 2009 394 8,837 600 21,099 994 29,936

- Scrap 0 0 0 0 0 0
+ Deliveries 46 1,459 39 932 85 2,391
Fleet Jan 2010 440 10,296 639 22,030 1,079 32,327

- Scrap 3 58 0 0 3 58
+ Deliveries 8 254 20 761 28 1,015
Fleet Jan 2011 445 10,492 659 22,791 1,104 33,284

- Scrap 3 79 2 38 5 118
+ Deliveries 0 0 9 390 9 390
Fleet Jan 2012 442 10,413 666 23,143 1,108 33,556
IMO 3 NDH
Fleet Jan 2007 208 2,148 91 1,277 299 3,425
- Scrap 30 385 19 173 49 558
Fleet Jan 2008 178 1,763 72 1,104 250 2,867

- Scrap 3 19 1 12 4 31
Fleet Jan 2009 175 1,744 71 1,092 246 2,836

- Scrap 3 20 4 47 7 67
Fleet Jan 2010 172 1,724 67 1,046 239 2,770

- Scrap 13 134 9 58 22 192
Fleet Jan 2011 159 1,590 58 988 217 2,578

- Scrap 12 119 6 64 18 183
Fleet Jan 2012 147 1,471 52 924 199 2,395

3Q2007
Table 3.11 Forecast chemical tanker fleet by type and employment cont’d

Type Category (dwt)
Non IMO
Fleet Jan 2007 0 0 499 13,537 499 13,537

- Scrap 0 0 61 952 61 952
+ Deliveries 0 0 47 2,050 47 2,050
Fleet Jan 2008 0 0 485 14,635 485 14,635

- Scrap 0 0 10 80 10 80
+ Deliveries 0 0 22 931 22 931
Fleet Jan 2009 0 0 497 15,486 497 15,486

- Scrap 0 0 9 97 9 97
+ Deliveries 0 0 10 466 10 466
Fleet Jan 2010 0 0 498 15,855 498 15,855

- Scrap 0 0 12 145 12 145
Fleet Jan 2011 0 0 486 15,710 486 15,710

- Scrap 12 147 12 147
Fleet Jan 2012 0 0 474 15,563 474 15,563
Total Fleet
Fleet Jan 2007 2,006 30,121 1,161 33,079 3,167 63,200
- Scrap 115 1,218 101 1,267 216 2,485
+ Deliveries 315 4,730 197 6,257 512 10,987
Fleet Jan 2008 2,206 33,633 1,257 38,069 3,463 71,702

- Scrap 19 300 15 108 34 408
+ Deliveries 268 5,119 97 2,682 365 7,801
Fleet Jan 2009 2,455 38,452 1,339 40,643 3,794 79,095

- Scrap 12 165 13 144 25 309
+ Deliveries 201 5,005 62 1,595 263 6,600
Fleet Jan 2010 2,644 43,292 1,388 42,095 4,032 85,386

- Scrap 45 507 22 209 67 715
+ Deliveries 105 3,210 28 930 133 4,140
Fleet Jan 2011 2,704 45,994 1,394 42,816 4,098 88,811

- Scrap 59 788 26 344 85 1,132
+ Deliveries 19 581 12 501 31 1,082
Fleet Jan 2012 2,664 45,787 1,380 42,973 4,044 88,760
Source: Drewry

3Q2007
Our scrapping assumption of 30 years is still maintained Not only have many chemicals and all of the vegetable
although this would mean that 172 ships should go to oils and fats changed from non-IMO to IMO class but
the scrap yard this year and a further 34 next year. This many chemicals have been upgraded from IMO III to
can be offset a little as of the 43 ships scrapped so far in IMO II class, requiring a minimum of a Double Hull.
2007, all but 10 were less than 30 years old and the
average size was over 27,000 dwt whereas the 172 The confusion regarding the IMO / MARPOL Annex II
ships have an average dwt of only 7,500 tonnes. There changes and the confusions are slowly being resolved.
may well be a number of the smaller size ships that We hear that IMO II ships with IMO III cargoes of
have gone to the yard or are laid up, there are 103 ships vegetable oils will be allowed to call in Rotterdam with
below 5,000 dwt over 30 years of age and some of the tanks full and not restricted to 3,000 cubic metres.
these are difficult to track down.
Annex I changes are the next regulation changes due.
st
As 2010 approaches and Annex I implementation looms, As from 1 January 2010, all Annex I products, i.e.
many single hull ships will be heading for the scrap petroleum products, must be carried in double hull ships.
yards and we expect to see scrap prices dropping. We The exception is for ships less than 5,000 dwt. This can
anticipate that the chemical tankers owners will see more of the double hull IMO III tankers moving into
anticipate this, hence our 30 year assumption holds. In the petroleum product trades; indeed it is already
Table 3.9, the actual arrivals in the yards are reported happening as ships are fixed on time charter to oil
st
for 1 three Quarters of 2007 while the year’s total traders.
comprises those ships, plus the ships reported sold for
scrap and all other ships built in 1977 or before. How many will move over will largely depend on the
freight markets for petroleum products versus chemicals
The resulting peak in demolition figures partly offsets the and vegetable oils. The next two years will be
peak in deliveries. Predictions between adjacent years interesting and the large orderbook may well be required
are difficult to judge as a one day delay, or advance in a to accommodate these changes.
scrapping date may change the year’s figures. We
expect the scrapping peak to roll forward to some extent 3.3 Future supply
as owners follow the deliveries pattern and the scrap
price levels. The forecasts of future supply take into account the new
regulations as well as the fact that IMO classed ships
In order to clarify the actual situation over the estimates, will always be trading in petroleum products.
the Tables 3.10 and 3.11 reflect the actual scrapping
and the remaining ships over 30 years as separate Hence we forecast supply on two bases, which are:
items. Likewise, the deliveries are split between actual
deliveries and ships due for delivery. o Total supply (including IMO ships trading in
petroleum products)
Regulation changes
o Pure chemical and vegetable oil fleet trading in
We are continuing to cover this subject as it serves as a chemicals and vegetable oils.
reminder that major changes have come into force and
adjustment to these is continuing. The 2007 average fleet size of 67.4m dwt is currently
expected to increase by 31.6% for an average in 2011 of
o All chemicals, vegetable oils and fats have to be 88.8m dwt; however, as ships are still being ordered for
carried in an IMO classed tanker. 2010 delivery, and even earlier in some cases, we
expect this percentage to increase further.
o IMO classed chemical tankers can continue to carry
petroleum products. The fleet with IMO class, including the non-double hull
ships, is expected to increase by 37.1% between the
o All non-IMO classed tankers of any type are not 2007 average and the 2011 average. This will also
allowed to carry chemicals, vegetable oils or fats, increase faster than for the total fleet because non-IMO
regardless of their size. ships are no longer being added to our lists.

3Q2007
3.4 Supply/demand balance figures indicate that demand for pure chemicals is likely
to grow by 18.7% from 2007-2011. At the same time,
Table 3.12 contains our assessments of the supply/ growth in demand for vegoils and other associated
demand balance going forward. We have provided products is expected to be 29.8% over the same time
three assessments of supply, (i) for the fleet as a whole, period.
(ii) for the IMO fleet and (iii) the non-IMO fleet.
3.5 Freight markets
Two assessments of employment are provided. The
first arising from seaborne trade in liquid chemicals and During the third quarter freight rates fell across the
vegetable oils, and the second arising from the carriage board and for the first time brokers reported small
of clean petroleum products. cracks in the façade of some ship owner’s confidence.
The trade has become more and more concerned
Total supply is projected to grow by about 31.2% over as to how the never ending amount of new buildings
the forecast period from 2007 to 2011. will be absorbed, particularly if the Chinese economy
slows.
IMO tonnage is expected to increase at the much faster
rate of 37.1% over the same period. The non-IMO At the same time major contracts, when being
tonnage growth is expected to be 10.6% which is faster renegotiated and/or placed on to the market, were still
than predicted last quarter because all non-IMO ships reported to be meeting with firm responses from the
are now included in the non-IMO figures, removing the COA holders, and/or not necessarily attracting new
previous prediction of half of them trading in chemicals entrants. Main contract volumes are also reported to be
and vegetable oils. holding up.
On the demand front, the pure chemicals employment is Perhaps the biggest blow to owners expecting returns in
also expected to increase steadily, thereby keeping recent months have been the high oil/bunker prices as
most of the supply constructively occupied. Our current well as the weakening freight dollar exchange.
Table 3.12 Chemical tanker supply/demand balances* (million dwt)
Supply Employment
Total Fleet IMO Non-IMO Chemicals Other Products**
2002 40.6 30.0 8.8

2003 43.7 31.8 12.4
2004 48.4 32.1 15.4
2005 52.8 33.6 19.2
2006 62.1 51.7 10.4 36.0 22.5
2007 67.5 53.4 14.1 40.0 25.5
2008
forecast
75.4 60.3 15.1 41.7 29.0

2009 82.2 66.5 15.7 43.1 32.1
2010 87.1 71.3 15.8 45.0 32.7
2011 88.8 73.2 15.6 47.5 33.1
% change 07/11 31.6% 37.1% 10.6% 18.7% 29.8%
* Demand arising from seaborne trade in liquid chemicals and vegetable oils/fats.
** CPP trades
Source: Drewry

3Q2007
In the deep sea markets: winter rape with wheat, the removal of EU set aside
restrictions, and demand for biodiesel, will lead to a
The US Gulf to and from South American trade lanes shortage that can only be to the advantage of palm oil,
appear to have begun to be plagued with similar and other soft oils.
problems as other major lanes - excessive tonnage
supply for both southbound and northbound and Unless ideal weather and crop yields ensure satisfactory
unexpected weakening demand. growth and demand for fuel use is curbed, Oil World
reports that we could see a food crisis on the not too
Lack of buying interest in European gasoline in the distant horizon. OPEC clearly intends to maximise
US caused CPP rates plummet to their lowest for returns on oils with a $90/bbl, or maybe $100/bbl.
four years which did not help an already weakening
chemical market west bound. Rates on a 37,000 tonne Compared to the main chemical and CPP markets, oils
cargo fell to World Scale 200 with owner’s earnings and fats freight has been relatively steady but still
slipping to around US$18,000/day, and the market tried weakening. Historically, soft oil freight, with the
to get by on occasional movements of reformats and exception of the last few months leading up to 1st
base oils. January 2007 (as the unqualified ships fixed their last
voyages), has been observed to track the vagaries of
The less regular owners were reported to be looking to the CPP market albeit with a lapse of a few months
alternative markets to try and better their income, and behind the peaks and troughs.
spot chemical rates dropped down some 15.0% over the
quarter. Since the new rules took effect at the beginning of this
year, we have not seen any dramatic change despite the
In the regional markets: CPP markets, especially Transatlantic, falling to their
lowest in 4 years. It is perhaps too early to determine
In July with the exception of some improved demand whether this link is not so effective anymore, but we
from WCI, the regional market was more or less at could see the CPP owners of modern tonnage less
status quo in the Middle East. If there was tonnage willing to swing into oils and fats, whilst those servicing
open and available it was generally because of reasons the trade will become “dedicated.
of age, approvals and previous cargoes.
During the third quarter, with a four year low clean
As for contracts, owners reported healthy volumes and petroleum market in the Atlantic Basin, we have seen a
this was evidenced by little spot space available from softening of global oils and fats rates, although the
the regulars. Rates for semi-prompt cargoes going east tropical oil lane from the Straits to Europe as well as the
were definitely coming under pressure, whereas the USA has proved more stable.
westbound volumes (often being more demanding on
approvals) seemed to be holding steady. The tropical oil market to Europe has stayed fairly
constant, although slipping around 1.0% over the
In the veg oil and molasses markets: quarter and around 4.5% over this time last year.
Demand for oils and fats is being checked by high Soft oil rates out of South America slipped lately by
prices, and whilst consumption is reported to have around 17.0% but are still up 6.0% over the same period
slowed, recently it has not yet affected sea borne- last year.
volumes. There are long term factors that could in fact
increase ocean going trade to the detriment of regional Looking ahead there were reports of increased activity
movements, particularly on sun oil and rape that are and arbitrage opening up on some routes but the
being replaced by palm. general view was that any increased market activity may
be soaked up by new tonnage being delivered.
For 2008, demand is likely to be mainly met by improved
production of palm oils. Present world oils and fats High demand for chemical commodities, in combination
reserves will be drawn down to around 16% of with several newly planned production units are likely to
production, the lowest for many years. provide a major boost to the seaborne trade.
Lower than expected production of oil seed crops in Nevertheless, all the signs now point to supply growing
the Northern Hemisphere, due to the replacement of faster than demand.

Table 3.13 Estimated representative chemical tanker rates - coated vessels (US$/day)*
Dwt 6,000 9,000 12,000 22,000 30,000 37,000

Type IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3
Age 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs
2002 4,985 4,272 7,025 5,701 8,841 8,201 10,937 10,190 11,970 11,115 13,090 11,934
2003 4,986 4,272 7,025 5,701 8,620 7,996 11,074 9,196 12,509 11,282 13,585 12,264
2004 5,276 4,272 7,131 5,915 9,350 8,282 12,550 9,664 14,237 11,451 15,953 13,478
© Drewry Shipping Consultants Ltd

2005 6,037 5,053 7,881 7,077 11,834 9,847 13,889 11,393 16,017 13,286 21,367 18,395
2006 6,750 5,475 8,838 7,663 13,313 11,250 14,875 12,813 18,388 15,688 24,500 21,563
2007 7,700 6,400 10,000 8,500 15,000 13,000 18,000 16,000 22,000 20,000 27,000 23,000
2008 7,300 5,800 9,000 7,500 13,000 11,000 16,000 14,000 20,000 18,000 25,000 21,000
2009 6,300 4,800 8,000 6,500 12,000 10,000 14,000 12,000 18,000 16,000 23,000 19,000
forecast
2010 7,300 5,800 9,000 7,500 14,000 12,000 16,000 14,000 20,000 18,000 25,000 21,000
2011 8,300 6,800 10,000 8,500 15,000 13,000 17,000 15,000 22,000 20,000 27,000 23,000
4Q05 6,300 5,100 8,000 7,400 13,000 11,000 14,000 12,000 16,000 14,500 25,000 23,500
1Q06 6,500 5,200 8,500 7,500 13,000 11,000 14,500 12,000 17,300 14,750 24,500 22,750
2Q06 6,500 5,200 8,600 7,500 12,500 10,500 14,000 12,250 17,750 14,500 24,000 21,000
3Q06 6,700 5,500 8,750 7,650 13,500 11,500 15,000 13,000 18,500 16,000 24,500 21,000
4Q06 7,300 6,000 9,500 8,000 14,250 12,000 16,000 14,000 20,000 17,500 25,000 21,500
1Q07 7,300 6,000 9,500 8,000 14,500 12,250 17,000 15,000 21,000 18,500 25,250 21,500
2Q07 8,000 6,400 10,300 8,500 15,000 13,500 18,000 15,200 22,000 19,000 15,563 14,625
3Q07 8,000 6,400 10,000 8,000 14,500 12,000 17,750 15,000 22,000 18,500 24,000 21,000
* Estimated representative rates for chemical tankers are based on a 12 month period with prompt delivery in US$pd and/or sailed in time charter equivalent on today's spot market.
Source: Drewry
3Q2007
43
3Q2007
44
Table 3.14 Estimated representative chemical tanker rates - IMO 2/3 fully stainless vessels (US$/day)*
Dwt 6,000 9,000 12,000 22,000 30,000 37,000

Type IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3 IMO 2 IMO 2/3
Age 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs 0-10 yrs 10-20 yrs
2002 6,722 6,111 8,429 7,631 10,812 9,639 16,117 15,464 22,567 21,578 27,170 n/a
2003 6,722 5,958 8,429 7,536 10,596 9,608 15,553 14,923 21,384 19,993 26,152 n/a
2004 6,991 5,806 8,534 7,250 11,693 10,025 16,526 14,381 22,078 18,900 28,961 n/a
2005 7,173 6,414 10,475 8,488 14,591 11,693 19,472 16,095 25,332 21,908 33,022 30,375
2006 8,113 6,925 11,725 9,350 15,363 12,550 22,125 18,688 28,063 25,075 33,875 31,750
2007 11,000 9,000 14,000 11,000 17,000 14,000 25,000 21,000 32,000 29,000 38,000 36,000
2008 10,000 8,000 13,000 10,000 16,000 12,000 22,000 18,000 29,000 26,000 35,000 33,000
2009 9,000 7,000 12,000 9,000 15,000 11,000 20,000 16,000 27,000 24,000 33,000 31,000
forecast
2010 11,000 9,000 14,000 11,000 17,000 13,000 23,000 19,000 30,000 27,000 35,000 33,000
2011 14,000 12,000 17,000 13,000 19,000 15,000 25,000 21,000 32,000 29,000 39,000 37,000
4Q05 7,200 6,600 11,200 9,000 15,500 13,000 20,000 17,500 27,000 24,000 33,500 31,500
1Q06 7,500 6,600 11,700 9,300 15,500 13,000 21,000 17,500 27,750 24,300 34,000 31,500
2Q06 7,500 6,600 11,700 9,300 15,000 12,000 22,000 18,750 27,000 24,000 33,000 31,000
3Q06 8,200 7,000 11,500 9,300 15,200 12,200 22,500 19,000 28,000 25,000 33,500 31,500
4Q06 9,250 7,500 12,000 9,500 15,750 13,000 23,000 19,500 29,500 27,000 35,000 33,000
1Q07 10,500 8,500 13,000 10,500 16,250 13,500 24,000 20,000 30,000 27,500 36,000 34,000
2Q07 11,250 9,000 14,200 13,000 17,000 14,000 24,000 20,000 32,000 28,000 37,500 34,000
3Q07 10,500 8,500 14,200 11,500 17,500 13,500 24,000 20,500 32,500 28,250 37,500 34,500
* Estimated representative rates for chemical tankers are based on a 12 month period with prompt delivery in US$pd and/or sailed in time charter equivalent on today's spot market.
Source: Drewry

3Q2007
Table 3.15 General deep sea and regional freight rates
Trade Legs/Cargo Size Product 2006 2007 3Q06 4Q06 1Q07 2Q07 3Q07
Transatlantic Eastbound
1,000 sus 70 83 72 74 83 85 80
2,500 easy 52 68 57 58 72 73 58
5,000 easy 40 54 42 47 57 60 46
Transatlantic Westbound
1,000 sus 78 71 75 65 73 73 66
2,500 easy 64 57 62 58 59 60 52
5,000 easy 56 47 56 48 47 56 39
Transpacific Westbound
1,000 sus 93 98 95 88 110 99 85
2,500 easy 68 78 70 68 90 75 68
5,000 easy 56 67 55 59 79 66 55
Far East-USG
1,000 easy 106 113 105 112 115 112 111
2,000 easy 95 93 95 95 95 93 92
7,000 easy 74 73 75 75 75 76 68
Far East-NW Europe

1,000 easy 118 109 120 115 110 108 109
2,000 easy 100 98 100 100 100 98 95
7,000 easy 86 86 85 87 89 85 83
AG - India
5,000 29 29 29 28 30 29 28
10,000 25 25 25 23 26 25 23
AG - Singapore
5,000 45 46 46 46 47 46 46
10,000 37 37 36 40 39 36 35
AG-South Korea
5,000 60 58 59 60 60 58 56
10,000 53 54 55 55 57 52 52
AG-NW Europe
5,000 70 70 70 70 72 72 67
10,000 65 65 67 67 65 66 63
AG-USWC
35,000 60 60 60 60 60 60 60
NWE-Far East
3,000 87 87 89 89 90 88 82
NWE-India
3,000 87 82 85 85 85 82 80
NWE-SEA
3,000 88 85 86 86 88 86 80
Source: Drewry

3Q2007
Table 3.16 General oils fats and molasses freight rates ($/mt)
Trade Legs Product 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07
Straits-Rotterdam
25-30,000 Palm Oil 49 65 65 52 60 63 65 59 59
3/5,000 Palm Oil 55 70 72 62 70 68 70 67 65
1000 Palm Oil 62 75 80 70 80 80 85 80 80
Straits/Turkey
7-10,000 Palm Oil 52 70 70 56 65 75 75 72 72
Straits-India Ocean
6,000 W.C.India Palm Oil 29 27 28 29 40 37 43 33 30
6,000 E.C.India Palm Oil 25 22 23 24 38 31 39 30 29

15/22,000 Pakistan Palm Oil 26 26 27 26 40 32 42 33 30
25,000 E.C.Africa Palm Oil 38 38 37 36 42 38 42 38 36
South America/various
25-30,000 China Soy/Sun 48 62 58 48 50 49 70 77 60
30,000 Karachi Soy/Sun 47 55 50 42 50 45 60 70 60
30,000 WC India Soy/Sun 46 54 48 42 46 45 62 71 59
30,000 EC India Soy/Sun 48 56 48 47 48 45 60 72 60
25,000 Bangladesh Soy/Sun 48 55 50 47 50 45 58 70 60
25,000 E.Med Soy/Sun 48 55 50 45 50 48 63 67 57
20,000 Black Sea Soy/Sun 55 60 55 52 50 48 65 68 56
20,000 S.Africa/India Soy/Sun 50 50 50 45 55 50 65 68 62
15,000 Caribbean Soy/Sun 40 42 50 45 50 47 58 68 40
15/20000 WC SAmerica Soy/Sun 52 60 60 55 50 45 68 80 50
7/8,000 N.Africa Soy/Sun 70 70 70 68 60 60 70 72 65
4,000 West Africa Soy/Sun 65 70 70 68 70 70 70 72 70
35,000 Iran Soy/Sun 42 42 40 42 40 33 42 65 50
20,000 Rotterdam Soy/Sun 48 58 58 48 48 48 60 63 59
US Gulf-various
10-15,000 China Soya Oil 68 65 63 62 62 62 70 70 65
15,000 E.Med Soya Oil 48 48 52 52 52 52 65 65 55
25,000 India or Pakistan Soya Oil 68 65 50 52 52 52 85 85 75
Canada (Vancouver)
10,000 China/SE Asia Rape Oil 42 40 42 42 45 45 45 44 45
Pakistan
28,000 Continent Molasses 35 45 45 36 38 39 39 39 43
20,000 Taiwan Molasses 24 28 28 27 30 30 38 36 35
East Africa
21,000 Med/Cont Molasses 36 36 36 35 38 45 48 48 47
Source: Drewry

3Q2007
Table 3.17 Chemical tanker market activity (‘000 dwt)
New Orders Secondhand Sales Demolition Sales

2002 81 2,080 32 376 17 349
2003 88 1,773 44 1,029 34 482
2004 66 1,455 72 2,018 8 156
2005 58 1,062 53 1,743 19 274
2006 68 1,671 134 3,129 55 1,037
2007* 53 1,234 76 1,759 40 1,091
1Q06 12 388 35 855 13 271

2Q06 18 399 49 932 17 275
3Q06 19 358 25 602 13 271
4Q06 19 526 25 740 12 219
1Q07 15 303 19 447 24 643
2Q07 11 262 30 769 12 376
3Q07 27 669 27 543 4 72
Source: Drewry
3.6 Newbuilding Another eight vessels were ordered by Blystad, Arne,

AS, all for 2010 delivery. The 25,000 dwt vessels were
In order to align the asset market with the revised placed on order at the Samho Tongyoung yard and were
chemical fleet, the newbuilding and secondhand values contracted at a price of $42.0m.
have also been updated, to now represent the
newbuilding prices of the IMO 2 type coated and 3.7 Secondhand
stainless steel vessels.
Just like the newbuilding markets, the weak chemical
In this publication, we have included the complete 3rd freight markets could not dampen the activity in the
quarter 2007 analysis. secondhand markets.
Even though the overall chemical markets did not The number of vessels that traded in the secondhand
perform well throughout 3Q07 in terms of earnings, a markets remained high during 3Q07 as well, at 27
high number of vessels were placed on order. vessels aggregating 0.5m dwt.
As compared to the 11 vessels of 0.3m dwt that were It is worth noting here inspite of an overflow of tonnage
placed on order during the previous quarter, in 3Q07, 27 in the secondhand markets, the selling prices for both
vessels of 0.7m dwt were ordered. coated and stainless steel vessels increased. While the
secondhand prices for a IMO 2 stainless 10-12,000 dwt
The high count of vessels ordered during the quarter vessel increased from $19.8-$24.2m seen in 2Q07 to
was largely on the back of 14 vessels aggregating $21.2-$25.9m in 3Q07, the prices for coated IMO 2 type
ordered by Capital Ship Management Corporation. 12 10-12,000 dwt vessel increased from $12.6-$15.4 to
of these vessels were 25,000 dwt size chemical carriers $13.5-$16.5.
that were placed on order at Samho Tongyoung yard for
delivery in 2010 and were procured for $42.0m each. Over the last few quarters, the increasing amount of
activity and the rising prices for both coated and
The other two vessels ordered by the company are stainless vessels suggests the continuing optimistic view
smaller 14,000 dwt size carriers that have been ordered that the owners have about the chemical markets.
at Baima Shipyard and are expected to be delivered to Amongst the deals concluded during 3Q07:-
the operating fleet during 2009. The company was
reported to have paid a price of $25.0m for both the Elmira Shipping Trading S.A concluded an en-bloc sale
vessels. of four of its 2006 built vessels, Liquid Blue, Liquid

3Q2007
Table 3.18 Newbuiling prices – IMO 2 – stainless (US$ million)
Chemical Tanker - IMO 2 - Stainless
Dwt 5-6,000 8-9,000 10-12,000 14-16,000 18-20,000 22-24,000 35-37,000 40-45,000
2002 12.6-15.4 13.1-16.0 15.3-18.7 17.1-20.9 22.1-27.0 28.8-35.2 45.0-55.0 48.6-59.4

2003 12.6-15.4 13.5-16.5 16.2-19.8 17.6-21.5 19.8-24.2 25.2-30.8 46.8-57.2 47.7-58.3
2004 15.0-18.4 16.2-19.8 19.8-24.2 22.1-27.0 24.3-29.7 28.1-34.3 49.5-60.5 54.0-66.0
2005 16.9-20.7 18.5-22.6 24.2-29.6 26.1-31.9 30.3-37.1 33.3-40.7 51.3-62.7 61.7-75.4
2006 18.0-22.0 21.6-26.4 27.0-33.0 29.7-36.3 36.0-44.0 36.9-45.1 57.6-70.4 67.5-82.5
2007* 19.3-23.6 22.4-27.5 29.7-36.3 32.8-39.4 37.5-45.8 41.6-49.4 59.1-72.9 78.1-95.5
1Q06 18.0-22.0 20.7-25.3 27.9-34.1 28.8-35.2 35.1-42.9 37.4-45.7 54.0-66.0 67.5-82.5

2Q06 18.4-22.5 21.2-25.8 28.8-35.2 30.6-37.4 36.0-44.0 38.7-47.3 57.6-70.4 72.0-88.0
3Q06 18.5-22.8 21.5-26 29.0-36.0 31.0-38.0 37.0-45.0 39.0-48.0 58.0-71.0 73.0-89.0
4Q06 18.9-23.1 21.6-26.4 29.2-35.7 31.5-38.5 37.3-45.7 39.6-48.4 58.5-71.5 74.7-91.3
1Q07 18.9-23.1 21.6-26.4 29.2-35.7 31.5-38.5 36.9-45.1 39.6-48.4 58.5-71.5 76.5-93.5
2Q07 19.2-23.4 22.5-27.5 29.7-36.3 32.1-39.3 37.4-45.7 40.5-49.0 59.7-72.9 78.3-95.7
3Q07 19.8-24.2 22.9-28.05 30.2-36.8 34.2-41.8 38.7-47.3 42.3-51.7 60.3-73.7 79.2-96.8
Source: Drewry
Velvet, Liquid Elegance and Liquid Beauty (12,901 dwt) $110.0m. The deal also included a bare boat charter
to undisclosed buyers for $30.5m each. back for 10 years of an undisclosed amount.
In another deal concluded during 3Q07, Palmali 3.8 Demolition

Shipping Co. sold three of their vessels, the 1995 built
Pacific Ambassador (29,667 dwt), the 1996 built Indian Since the beginning of 2007, the only most noticeable
Ambassador (28,840 dwt) and the 1998 built Atlantic feature has been the high levels of vessels sold for
Ambassador (29,667 dwt) for an en-bloc price of scrapping. As opposed to the 30 vessels of 0.5m dwt
Table 3.19 Newbuiling prices – IMO 2 – coated (US$ million)
Chemical Tanker - IMO 2 - Coated
Dwt 5-6,000 8-9,000 10-12,000 14-16,000 18-20,000 22-24,000 35-37,000 40-45,000
2002 9.2-11.2 9.9-12.1 10.7-13.1 12.2-14.9 14.6-17.8 17.1-20.9 23.4-28.6 26.1-31.9

2003 9.5-11.7 10.4-12.8 11.7-14.3 12.4-15.2 14.9-18.3 17.6-21.5 25.2-30.8 30.2-36.9
2004 10.8-13.2 12.2-14.9 14.1-17.3 16.0-19.6 17.6-21.5 19.8-24.2 27.0-33.0 31.5-38.5
2005 11.6-14.2 14.0-17.1 16.5-20.1 18.3-22.3 20.0-24.4 22.8-27.8 29.3-35.8 33.8-41.4
2006 13.4-16.4 15.8-19.3 19.3-23.6 21.2-25.9 24.8-30.3 25.7-31.4 36.3-44.4 42.2-51.6
2007* 13.8-16.9 17.4-21.3 21.2-15.9 24.4-29.8 27.6-33.7 30.9-37.8 42.0-51.3 48.0-58.7
1Q06 13.5-16.5 14.9-18.2 17.6-21.5 19.8-24.2 23.4-28.6 24.3-29.7 31.5-38.5 39.2-47.9

2Q06 13.3-16.3 15.3-18.7 18.9-23.1 20.7-25.3 24.3-29.7 26.1-31.9 35.6-43.5 41.4-50.6
3Q06 13.4-16.4 16.2-19.8 19.8-24.2 21.6-26.4 25.2-30.8 27.0-330 38.7-47.3 43.2-52.8
4Q06 13.5-16.5 16.8-20.6 20.9-25.5 22.8-27.8 26.1-31.9 27.9-34.1 39.6-48.4 45.0-55.0
1Q07 13.5-16.5 17.1-20.9 20.7-25.3 23.6-29.0 27.0-33.0 29.7-36.3 41.4-50.6 47.7-58.3
2Q07 13.9-16.5 17.6-21.5 21.2-25.9 24.3-29.7 27.9-34.1 31.5-38.5 42.3-51.7 47.8-58.4
3Q07 14.1-17.3 17.6-21.6 21.6-26.4 25.2-30.8 27.9-34.1 31.5-38.5 42.3-51..7 48.6-59.4
Source: Drewry

3Q2007
Table 3.20 Secondhand prices – IMO 2 – stainless (US$ million)
Chemical Tanker - IMO 2 - Stainless
Dwt 5-6,000 8-9,000 10-12,000 14-16,000 18-20,000 22-24,000 35-37,000 40-45,000
2002 6.8-8.3 7.7-9.4 8.1-9.9 11.3-13.8 12.6-15.4 16.0-19.6 23.4-28.6 25.2-30.8

2003 7.2-8.8 8.7-10.7 9.9-12.1 12.6-15.4 13.5-16.5 14.9-18.3 24.3-29.7 29.7-36.3
2004 7.7-9.4 9.9-12.1 11.7-14.3 13.5-16.5 15.3-18.7 18.0-22.0 26.1-31.9 31.5-38.5
2005 8.2-10.0 13.3-16.3 15.1-18.5 17.8-21.8 19.8-24.2 20.6-25.2 30.3-37.1 36.2-44.2
2006 9.3-11.3 14.7-17.9 18.8-23.0 20.0-24.4 21.0-25.7 21.8-26.6 34.7-42.4 40.9-50.0
2007 10.9-13.3 16.0-19.6 20.1-24.5 26.7-32.7 28.1-34.3 29.9-36.5 36.2-44.2 44.6-54.5
1Q06 9.0-11.0 14.4-17.6 18.5-22.6 19.8-24.2 20.7-25.2 21.6-26.4 34.2-41.8 40.5-49.5

2Q06 9.3-11.3 14.7-17.9 18.9-23.1 20.0-24.4 21.1-25.8 21.8-26.6 34.8-42.6 40.9-50.1
3Q06 9.4-11.6 14.8-18.1 19.2-23.4 20.2-24.7 21.2-25.9 21.9-26.7 35.1-42.9 41.4-50.6
4Q06 9.9-12.1 16.2-19.8 19.8-24.2 25.2-30.8 27.0-33.0 29.2-35.7 35.5-43.4 42.3-51.7
1Q07 10.1-12.3 16.0-19.6 19.8-24.2 26.0-32.4 27.0-33.0 29.2-35.7 35.7-43.7 42.8-52.2
2Q07 10.1-12.3 15.9-19.5 19.8-24.2 26.6-32.6 27.9-34.1 29.7-36.3 36.0-44.0 45.0-55.0
3Q07 12.6-15.4 16.2-19.8 21.2-25.9 27.0-33.0 28.8-35.2 30.6-37.4 36.9-45.1 45.9-56.1
Source: Drewry
that were sent for scrapping in 1H06, this year the sold to the demolition yards. Of the four vessels, two
numbers rose to 36 vessels of 1.0m dwt. were scrapped in Bangladesh, two of the vessels, the
1979 built Putri Sakti and the 1980 built Aegean Trader
In 3Q07, however, the activity finally slowed down and were sold to the yards for scrapping in July and August
only 4 vessels aggregating 0.01m dwt were reported as (3Q07).
Table 3.21 Secondhand prices – IMO 2 – coated (US$ million)
Chemical Tanker - IMO 2 - Coated
Dwt 5-6,000 8-9,000 10-12,000 14-16,000 18-20,000 22-24,000 35-37,000 40-45,000
2002 5.4-6.6 6.4-7.8 6.8-8.4 8.6-10.5 9.5-11.6 12.2-14.9 13.1-16.0 15.3-18.7

2003 5.9-7.2 6.0-7.4 7.7-9.4 9.0-11.0 9.6-11.8 12.4-15.2 14.9-18.2 18.0-22.0
2004 6.7-8.1 6.9-8.5 8.7-10.7 10.8-13.2 12.6-15.4 14.2-17.4 16.2-19.8 19.6-24.0
2005 7.2-8.8 8.8-10.8 11.0-13.4 12.2-14.9 14.2-17.4 15.7-19.1 16.9-20.7 22.1-27.0
2006 7.4-9.2 10.0-12.3 12.2-14.9 14.1-17.3 15.5-19.3 16.4-20.0 19.8-24.2 25.2-29.7
2007 8.4-10.2 11.3-13.8 13.0-15.8 14.8-18.0 16.7-20.4 19.4-23.7 29.8-36.4 31.8-38.9
1Q06 7.2-8.8 9.9-12.1 12.0-14.6 14.0-17.2 15.3-18.7 16.2-19.8 18.0-22.0 23.4-28.6

2Q06 7.6-9.2 10.1-12.3 12.2-14.9 14.1-17.3 15.5-18.9 16.4-20.0 19.9-24.2 24.3-29.7
3Q06 7.7-9.4 10.2-12.5 12.3-15.1 14.2-17.4 15.8-19.3 16.6-20.2 21.6-26.4 25.2-30.8
4Q06 8.0-9.9 10.8-132 12.6-15.4 14.4-17.6 16.2-19.8 18.0-220 25.2-30.8 27.9-34.1
1Q07 8.2-10.0 11.1-13.5 12.8-15.6 14.4-17.6 16.4-20.0 18.9-23.1 29.7-36.3 31.5-38.5
2Q07 8.4-10.2 11.2-13.6 12.6-15.4 14.6-17.8 16.5-20.1 19.8-24.2 29.9-36.5 32.4-39.6
3Q07 8.6-10.5 11.5-14.1 13.5-16.5 15.3-18.7 17.1-20.9 19.4-23.7 29.7-36.3 31.5-38.5
Source: Drewry

3Q2007
Table 3.22 Historical and forecast bunker prices (US$ per ton)
Arabian Gulf N.Europe Med US Gulf Caribbean Singapore

IFO MDO IFO MDO IFO MDO IFO MDO IFO MDO IFO MDO
2002 152 222 138 187 150 232 137 196 156 242 153 202
2003 171 266 159 231 176 288 167 268 181 294 176 242
2004 184 359 168 312 188 385 179 328 195 383 185 337
2005 272 502 256 454 280 543 266 509 296 601 273 480
2006 323 616 311 522 341 625 314 558 345 662 321 574
2007 364 649 342 540 381 660 345 577 375 663 361 606
forecast
2008 392 697 372 583 413 707 377 614 408 697 392 650
2009 378 680 358 569 403 700 358 609 393 710 383 635
2010 373 672 353 563 398 692 353 602 388 702 378 627
2011 361 650 342 544 385 670 342 583 376 679 366 607
2Q06 352 641 336 566 364 662 337 574 365 667 348 632
3Q06 330 681 319 553 355 660 324 575 356 668 325 625
4Q06 283 607 280 481 310 586 279 540 316 620 285 528
1Q07 306 584 270 464 307 565 276 518 315 610 303 523
2Q07 358 621 341 532 376 654 340 563 367 648 355 603
3Q07 397 691 382 575 426 709 386 609 408 694 390 642
4Q07 395 702 374 587 416 712 379 619 411 702 395 655
1Q08 384 682 364 571 404 693 369 602 399 682 384 637
forecast
2Q08 396 703 375 588 416 713 380 619 411 703 396 656
3Q08 402 714 381 598 423 725 386 630 418 714 402 667
4Q08 387 687 366 575 407 697 371 605 402 687 387 641
1Q09 377 670 357 561 397 680 362 591 392 670 377 625
Source: Drewry
Table 3.23 Representative operating costs for 2007 (US$ per day)
Dwt 5-6,000 8-9,000 10-12,000 13-16,000 18-20,000 22-24,000 29-31,000 35-37000 40-45,000
Stainless
Operating Costs for a new vessel

$/day 1,669 1,895 2,100 2,360 2,750 3,450 3,875 4,100 4,400
Operating Costs for 10 year old vessel

$/day 2,255 2,483 2,632 2,810 3,100 3,630 4,060 4,313 4,670
Coated
Operating Costs for a new vessel

$day 1,600 1,775 1,990 2,245 2,835 3,300 3,695 4,010 4,350
Operating Costs for 10 year old vessel

$'000/day 3,310 3,427 3,570 3,665 3,865 3,925 4,285 4,535 4,837
Second hand tankers assumed 10 year old. Only minor coating repairs allowed and no steel renewal. Assumed hoses charterers supply. Smaller
tankers (5,000-12,000 dwt) assumed on regional business. Stainless steel tankers (5,000-12,000) assumed with electric submerged pumps and larger
tankers having 4 centrifugal pumps. Assumed vessels comply with Marpol Annex III and VI
Source: Drewry

3Q2007
chemical forecaster freight markets
4. Freight markets pressure, the Pacific showed signs of resurgence which

if it continues could lead to other markets up with it.
4.1 Major deep sea trade legs Looking ahead there were reports of increased activity
and arbitrage opening up on some routes but the
During the third quarter freight rates fell across the general view was that any increased market activity may
board and for the first time brokers reported small cracks be soaked up by new tonnage being delivered.
in the façade of some ship owner’s confidence. The
trade has become more and more concerned as to how 4.2 Transatlantic eastbound
the never ending amount of new buildings will be
absorbed, particularly if the Chinese economy slows. At the start of July, contract nominations were reported
to be fairly strong but as the month continued owners
At the same time major contracts, when being began to struggle against a flagging CPP market.
renegotiated and/or placed on to the market, were still Regular players reported contract volumes slipping
reported to be meeting with firm responses from the whilst biodiesel and styrene volumes (so long the “filler”
COA holders, and/or not necessarily attracting new this year) also became more sporadic and rates began
entrants. Main contract volumes are also reported to be to fall, albeit more on the larger volumes.
holding up.
Figure 4.1 Spot rates - Transatlantic
The CPP market remained very soft over the summer eastbound, USG - Rotterdam ($/mt)
period particularly in the West with earnings down to
US$15-17,000pd and ample positions were being
100 1,000 sus 2,500 easy 5,000 easy
recorded in the Caribbean and Continent, however, time
charter rates for 13,000 dwt range IMO 2 vessels were
80
reported to be holding firm at up to US$15,000pd.
60
Perhaps the biggest blow to owners expecting returns in
recent months have been the high oil/bunker prices as
well as the weakening freight dollar exchange. 40
All eyes have been on China as their lower demand 20
3Q02 3Q03 3Q04 3Q05 3Q06 3Q07
coupled with high commodities prices seemed to be
Source: Drewry
pointing to a worrying slowdown. It was reported shore
tanks ex mid China were almost full of cargoes but with
very limited takers arriving for export. The flooding A 5,000 tonnes parcel from US Gulf to Rotterdam could
along Lake Tai and Yangtze River in July worsened the apparently be fixed in the high US$40/t by the end of
situation. Hundreds of small chemical factories were July whereas this would have paid mid US$60’s/t a few
recently forced to close in Jiangsu province alone on months before. The situation was not helped by an
concerns of water pollution and the Jiangsu provincial influx of outside tonnage into the USG ex-Cont, due to a
government made it clear that there would eventually be weak CPP market, with a reported four-five 12-16,000
more than 2,000 chemical plants along Lake Tai closed dwt vessels added to the mix for end Jul-mid
by the end of 2008, so the problem would appear to be August.
not how quick the economy in China will grow, but at
what cost to health and sustainability. Biodiesel volumes picked up again in August with
12,000 tonnes being reported fixed account Vinmar from
Increasing volumes of caustic soda, along with MTBE, Houston and New Orleans to Rotterdam at around
naphtha, methanol and ethanol were still the main US$48.5/t for early August lifts. Other fixtures of interest
grades out of China with caustic to India, other Far East in August were Stolt-Nielsen tonnage fixing Kolmar from
ports as well as movements into Australia, which also US Gulf to Rotterdam in the low US$ 50’s/t and Total
became the recipient of the first methanol shipment out fixing 6,000 tonnes of xylene from Houston to ARA in
of the new methanol plant in Hainan. Several acetic the low US$ 50/t on the “Jo Ask”.
acid movements were also reported to Korea and
Europe for account of Celanese. There were mixed The month of August was also reported to have picked
signals across all chemical markets by the month of up over July due to a European styrene producer
September. Whereas Transatlantic remained under scheduling a plant turnaround, and two styrene cargoes

3Q2007
reported fixed were on the “Stolt Endurance” with 10,000 In addition, MISC is reported to be looking seriously into
tonnes for Helm from Texas City at around US$ 50-53/t the possibility of establishing a transatlantic service that
and 5,000 tonnes for Novachem in the mid to high would commence in the 2nd quarter of 2008.
US$50/t. The regular owners were reporting high COA
nominations with the exception of Stolt-Nielsen and While they would start out utilizing two 19,900 dwt
Hiltveit who were more affected by the Celanese plant stainless ships, they would consider increasing this
problems. number to as many as five ships of this size.
Cargoes fixed in the month of August were 7,000 tonnes 4.3 Transatlantic westbound
cumene from USG to Rotterdam for Ineos on the
‘Sichem Aniline’, off 15-25 August, in the mid US$ 40s/t Lack of buying interest in European gasoline in the US
and 3,000 tonnes of biodiesel, for Vinmar which was caused CPP rates plummet to their lowest for four years
thought to have been fixed from New Orleans to which did not help an already weakening chemical
Rotterdam on the ‘Sichem Manilla’, off early August market west bound. Rates on a 37,000 tonne cargo fell
dates, in the low $50s/t. to World Scale 200 with owner’s earnings slipping to
around US$18,000/day, and the market tried to get by
All in all eastbound rates suffered an 8.0% drop during on occasional movements of reformats and base oils.
the month of August for 5,000 tonne parcels. However,
by the end of the month rates seemed to have Figure 4.2 Spot rates: Transatlantic
stabilized, with owners having some success in holding westbound, Rotterdam - USG ($/mt)
those levels.
100 1,000 sus 2,500 easy 5,000 easy
There were still several positions looking to fill out of the
Gulf and off the East Coast for the month of September. 80
Most owners were noting several outstanding biodiesel
cargoes with a few notable fixtures to report. World 60
Energy reportedly fixed 6,000 tonnes biodiesel on Jo
Tankers tonnage at rates reported at US$ 50/t basis 40
Houston/ Rotterdam. Additionally, several traders were
in the market for similar moves with 5,000 tonnes and 20
2,000 tonne parcels for prompt lifting. 3Q02 3Q03 3Q04 3Q05 3Q06 3Q07
Source: Drewry
So far in the quarter, according to one major Atlantic
broker, the percentage of increases being offered by the AOT fixed the “Diplomat” for 12,000 tonnes reformate
owners for the various trade lanes have been from the Continent to the USEC option USG loading 5-
significantly lower than was the case last year. The 10 Jul., reportedly at US$37/t. AOT was also looking to
Atlantic trade route seems to be under the most move 8,000 tonnes reformate ex Le Havre, but no fixture
competitive pressure. Chem-Tankers, for instance, was reported. Shell were reported to fix 5,500 tonnes
have apparently increased their eastbound capacity to lube oils from the Continent to the Caribbean on
2.0 sailings per month to the Continent in an effort to “Oriental Tulip”, loading 20-30 Aug. By the end of July
increase their market share on this route. They have World Scale rates dropped to 190 for Continent to the
secured a contract with one of the majors previously USG/ USEC.
held for years by another one of the major operators.
Some VAM cargoes were seen from Antwerp to the US
Representative fixtures: third quarter 2007 Gulf and some BTX cargoes, as well as UAN
movements from Poland but owners were reported
6,000 mts ethanol Santos/Rotterdam low US$ 70’s pmt sailing to the US Gulf with plenty of available space. A
7,000 mts styrene monomer Houston/Rotterdam US$ 52 pmt larger parcel of Methanol was reported fixed Baltic/USG
Helm/Odfjell in the mid US$ 40’s.
6,000 mts xylene Houston/Rotterdam low US$ 50’s pmt Jo
Tankers
The less regular owners were reported to be looking to
6,000 mts bio diesel Savannah Rotterdam US$ 69 pmt
alternative markets to try and better their income, and
22,000 mts fish oil Peru/Ghent Chembulk US$ 67 pmt
spot chemical rates dropped down some 15.0% over the
15,000 mts fish oil New Orleans/Fredrikstad US$ 81 pmt quarter.

3Q2007
Contract volumes kept some regular players occupied in June, then to $59/t in July. While there were
for some of the time, but open tonnage was seen at suspicions that some 50,000 tonnes of PX moved on the
times throughout the month of August. Very little was spot market to help fill July tonnage, there was precious
seen in the way of aromatics cargoes and rates suffered little to report for August shipments resulting in several
somewhat due to the lack of activity. CPP rates owners pulling vessels off the berth in that month in
dropped further from around WS 190 on a 37,000 order to consolidate contractual cargoes. This did little
tonnes basis to WS 155 towards the end of the month. to keep freights from falling further and the month of
As September began, there did appear to be some August proved really difficult for owners.
improvement with a possible WS 175 being reported.
Major chemical owners appeared to be busier for Figure 4.3 Spot rates: Transpacific
September which was expected to have a positive affect westbound US Gulf-Far East ($/mt)
on rates, however this has not become apparent as yet.
150 1,000 sus 2,500 easy 5,000 easy
Traders reportedly fixed 10,000 tonnes of toluene on the
“Gennaro Ievoli” (a Stolt-Nielsen TC vessel) at rates in 120
the low $30s/t basis prompt loading. Sabic was
reportedly in the market with 6,000 tonne pygas Tees /
90
USG 2nd half September and the CPP market yet the
overall feeling is that as the heating oil season
60
approaches rates should firm up a bit, but as the
summer has concluded and rates are low, we still
characterize the market as weak. 30
3Q02 3Q03 3Q04 3Q05 3Q06 3Q07
Source: Drewry
The UAN market was relatively active even though the
product price was also moving up. A significant volume
of UAN was shipped to Argentina during September. Even sophisticated tonnage was keen to fix large slugs
The weak dollar has created quite a challenge to of commodity cargoes to fill and stainless regulars
complete sales of UAN into the United States. A competed head on with 45,000 dwt product chemical
majority of the available product flowed from Europe and tankers for the month of August.
Eastern Europe to Argentina, as well as, a number of
inter- European moves. Four liftings of UAN ranging in Aurora pulled their first half August vessel due to a lack
size from 18 to 25,000 tonnes were confirmed to of COA cargoes, and was reported to still have space on
Argentina at freight levels in the low US$ 40’s/t. The their second half vessel “Maritime Jingan” depending on
rates for product moving from the Baltic to the how COA nominations finalized. Eitzen were also
USEC/USG remained in the US$ mid-30’s/t again during reported to have space and to have separated
September, while the freight levels from the Black Sea themselves as the only carrier that will opt to sail light
to the USEC/USG were also holding into the low US$ than fix below US$ 60/t level. There was talk of an
40’s/t. For the third straight month, the Henry Hub occasional opening of PX and Styrene arbitrage
natural gas spot prices remained virtually unchanged windows, but little developed.
averaging $6.24/ MMBTU.
The 5,000 tonne benchmark rate dropped another
Representative fixtures: third quarter 2007 20.0% to US$47/t in the month of August, the lowest
rate for nearly four years. The specialty parcel tanker
2,000 mts chemicals Rotterdam/Freeport Dow US$ 58 pmt market also took a noticeable hit with the 1,000 tonne
20,000 mts methanol Baltic/US Gulf mid US$ 40’s pmt benchmark rate falling from US$94 to US$ 85/t (9-10%)
18,000 mts UAN Baltic/US Gulf low US% 40’s pmt during the same period. In fact the smaller, stainless
steel vessels arguably had more problems filling in
1,000 mts 2-E-H Rotterdam/Puerto Cabello US$ 130 pmt
August than did the big commodity carriers, and willing
25,000 mts UAN Novorossissk/Argentina los US$ 40’s pmt
to drop down to US$ 50 pmt for BTX cargoes.
18,000 mts caustic soda solution Antwerp/USAC US$ 35 pmt
September began to see renewed Asian interest in

4.4 Transpacific westbound buying xylenes and contract nominations appeared to be
slightly healthier bolstering several owners’ freight ideas
Rates for 5,000 tonne parcels from the US Gulf to main and the market firmed to low US$50s/t for the 5,000
port Far East fell 21.0% from US$75/t in May to US$65/t tonnes. As inquiry then began to build over a wider

3Q2007
variety of other products, rates climbed into the low laycans. One owner claimed that his vessel discharging
$50s/t and by the end of the month and the regular 3 ports WC India was facing up to 5 days berthing delay
operators were striving to push these rates towards the in each port. Consequently, the vessel was going to
mid $50s/t and hold them there. These other products miss the next laycan in the MEG.
in play in included BTX, Acrylonitrile, EDC, MEG and
Vegoil. Sumit fixed 20,000 tonnes of styrene USG / The deep sea market was not so affected, but the lack
China on Chembulk tonnage at rates estimated in the of base cargoes meant that there were positions
US$ high 40s/t to low 50s/t. Traders also reportedly stacking up, waiting for the “big” cargo to put them on
fixed 5,000 tonnes styrene USG / Korea on the berth. 12,000 tonnes of MTBE was fixed into the
“Chembulk Westport” at $63.0/t for September loading. Mediterranean - in the low US$50’s/t, and 30,000 tonnes
Arbitrage appeared to be open with several traders of methanol to the Continent for second half August in
looking at 5,000 –10,000 tonne stems for October. the US$ high 50’s/t. 4,000 tonnes of normal paraffin and
LAB was also fixed to the continent from Iran.
Freight levels for the smaller parcels also climbed in
September. By the end of the month rates being offered One broker reported more MR’s fixture of MTBE to the
were between $110-115/t, but fixing levels were actually continent as proof that this cargo is moving away from
close to $105-110/t. The EPCA meetings (coupled with the chemical markets.
holidays in the Far East) slowed down activity towards
the end of the month and fewer deals were concluded. As for contracts, owners reported healthy volumes and
this was evidenced by little spot space available for the
regulars – some of them were said to be well covered
5,000 mts xylene Houston/Korea high US$ 40’s pmt
into October.
15,000 mts styrene US Gulf/China low US$ 60’s pmt
18,000 mts EDC US Gulf Main Port Far East US$ 65 pmt Westbound 30,000 tonnes chemicals got fixed from Iran
to Europe in the mid US$ 60’s/t. A similar cargo was
being worked for loading October. Some smaller sized
4.5 Middle East Gulf to North West Europe cargoes were fixed to Rotterdam and Turkey.
and Mediterranean
Quality tonnage became hard to find on October dates,
Middle East Gulf - Westbound witnessed little with several parties struggling to cover requirements
excitement with limited chemical activities until leading to increased rate pressure and demand held up
September. There was a build up of small-mid sized better than expected leading up to Ramadan.
tankers, adding pressure to the freight rates. Westbound cargoes were reported to be the most
challenging to cover but brokers reported that they are
Delays in India were making it more difficult to fix now seeing eastbound requirements becoming
vessels that were facing severe delays in WC India, increasingly difficult to close. This trend is in contrast to
which was affecting their ability to meet their loading the markets West of Suez, which continue to remain
fairly dull at most places.
Figure 4.4 Spot rates: Middle East Gulf to Owners were expected to position more vessels into the
NW Europe ($/mt) area due to the overall poorer markets seen in the west,
but this might have an effect on November
5,000 Rotterdam 10,000 Rotterdam requirements. Whether there would be a surge in rates
80
or a more modest appreciation remains uncertain, but
70 increased volumes from new Iranian output should help.
60 Representative fixtures: third quarter 2007
50
30,000 mts chemicals Iran/NW Europe US$ mid 60’s pmt
40 30,000 mts methanol Jubail/Continent US$ 59 pmt
17,000 mts methanol BIK/Med-Continent US$ 53 pmt (COA)

30
3Q02 3Q03 3Q04 3Q05 3Q06 3Q07 17,000 mts methanol Assaluyeh/Med-Continent US$ 54-57 pmt
(COA)
Source: Drewry

3Q2007
Table 4.1 General deep sea and regional freight rates ($/mt)
Trade Legs/Cargo Size Product 2006 2007* 3Q06 4Q06 1Q07 2Q07 3Q07
Transatlantic Eastbound
1,000 sus 70 83 72 74 83 85 80
2,500 easy 52 68 57 58 72 73 58
5,000 easy 40 54 42 47 57 60 46
Transatlantic Westbound
1,000 sus 78 71 75 65 73 73 66
2,500 easy 64 57 62 58 59 60 52
5,000 easy 56 47 56 48 47 56 39
Transpacific Westbound
1,000 sus 93 98 95 88 110 99 85
2,500 easy 68 78 70 68 90 75 68
5,000 easy 56 67 55 59 79 66 55
Far East-USG
1,000 easy 106 113 105 112 115 112 111
2,000 easy 95 93 95 95 95 93 92
7,000 easy 74 73 75 75 75 76 68
Far East-NW Europe

1,000 easy 118 109 120 115 110 108 109
2,000 easy 100 98 100 100 100 98 95
7,000 easy 86 86 85 87 89 85 83
AG - India
5,000 29 29 29 28 30 29 28
10,000 25 25 25 23 26 25 23
AG - Singapore
5,000 45 46 46 46 47 46 46
10,000 37 37 36 40 39 36 35
AG-South Korea
5,000 60 58 59 60 60 58 56
10,000 53 54 55 55 57 52 52
AG-NW Europe
5,000 70 70 70 70 72 72 67
10,000 65 65 67 67 65 66 63
AG-USWC
35,000 60 60 60 60 60 60 60
NWE-Far East
3,000 87 87 89 89 90 88 82
NWE-India
3,000 87 82 85 85 85 82 80
NWE-SEA
3,000 88 85 86 86 88 86 80
* Average year to date.
Source: Drewry

3Q2007
4.6 Northwest Europe to India/S.E. Asia and As September approached, there did seem to be some
Far East improvement however, with a few more enquiries and
less open tonnage for September being reported.
NW Europe to main ports, Indian Ocean and the Far Europe to India appeared to be a little more stable,
East, followed the summer trend and slowed down with a higher level of enquiries and fixtures seen and
considerably but was showing signs of firming by the owners were quick to respond to an apparent reduction
end of September. in open tonnage for September and rates had firmed a
little.
Contract business kept the market afloat during July but
a lack of spot business was notable throughout the Fixtures seen on this route included 5,500 tonnes of
month. Owners found themselves with plenty of space pure phenol, for Polimeri, from Porto Torres to Yangtze
and few enquiries. Major players reported to be were river at $145/t and ICC may have also fixed the ‘Oriental
struggling to fill all their available space. Some Salvia’, with 5500 tonne chemicals including toluene, to
acrylonitrile was seen moving to BIK and China, while Kandla and Bombay, in the high US$ 90s/t. Kolmar may
phenol was fixed from the Mediterranean. Europe to have fixed 5000 tonne styrene from Houston to Korea or
India was reported to be particularly quiet in July, with China, off end August, between high US$ 50st.
spot business extremely sparse and the general level of
enquiries was low. September was an extremely active time period for the
trade route. Traders reportedly fixed a total of 13,000
tonnes of styrene on the “Hartati” Continent / WCI and
Figure 4.5 Spot rates: NW Europe to AG at rates reported in the low/mid US$70s/t for a
India/Asia and Far East ($/mt) prompt loading. An additional 12,000 tonnes was
reportedly fixed as well with no details forthcoming. The
120 3,000 S.E.Asia 3,000 Far East 3,000 India majors were active in the lube trade with a total of nearly
20,000 tonnes fixed into India / MEG. The recent
100 activity spike has made the space situation somewhat
tight as the regulars remain mostly covered for August
80 and into the first half of September. The market can be
described as stable, as there are still pockets remaining
60 for the rest of the month for moves into the Far East.
Expectations are that this trend will continue, although
the route could be adversely affected if the US supplied
40
3Q02 3Q03 3Q04 3Q05 3Q06 3Q07 the demand at more competitive pricing.
Source: Drewry
Representative fixtures: third quarter 2007
Various acrylonitrile enquiries ex-Ventspils and Tees

8,250 mts lubes Augusta/Jebel Ali US$ 63 pmt “Heidmar tonnage”
were fixed to BIK and China. An Italian producer
entered the market with 5,500 tonnes of phenol ex- 13,000 mts styrene Continent/MEG and India US$ 70’s pmt
Mediterranean to 3 ports in China, and another “Hartati”
European producer was trying to ship 1,000 tonnes 5,500 mts pure phenol Porto Torres to Yangtze River US$ 145 pmt
phenol to NE Asia. Product pricing is still the major
driver in keeping the cargoes on the Continent but the
price of acrylonitrile could justify such shipments. 4.7 US Gulf to South America
More ships are becoming available, a result of Asian The US Gulf to and from South American trade lanes
domiciled tonnage venturing to European waters. appear to have begun to be plagued with similar
Berlian Laju Tankers (BLT) had two vessels discharging problems as other major lanes - excessive tonnage
in Europe in July and a third due mid August. Activity supply for both southbound and northbound and
from Europe to Asia remained low at the beginning of unexpected weakening demand.
August, following on from a slow down in the previous
month. Many of the regular players on the route had Caustic soda continued to be shipped from the US Gulf
open tonnage and were struggling to find cargoes. to Brazil although the supply ex Gulf was described as
Some acetone and styrene were seen moving tight and in July both Odfjell and Stolt-Nielsen were
eastwards, but perhaps at lower rates. reported to have open space southbound.

3Q2007
Figure 4.6 Spot rates: US Gulf to Spruce” reportedly had 5/10,000 tonnes open space
S. America ($/mt) direction Caribs/USG/USEC after having fixed Copesul
for about 15,000 tonnes BTX Rio Grande to USG.
80 2,000 easy 3,000 easy 5,000 easy Copesul was reported again in the market for 11,000
70 tonnes BTX Rio Grande/USG on September 10/15
dates.
60
50 Expectations are that north bound rates will weaken

while South bound rates should remain stable.
40
30
Representative fixtures: third quarter 2007
20
3Q03 3Q04 3Q05 3Q06 3Q07
7,000 mts ethanol Santos/Lagos mid US$ 70’s pmt Sichem Ruby
Source: Drewry
20,000 mts ethanol Santos/India-AG US$ 52 pmt Iver Progress
10,000 mts BTX Rio Grande/US Gulf US$ 55 pmt Annette Theresa
Brazilian ethanol exports remained well below last year’s
10,000 mts bio diesel Argentina/San Francisco US$ 98 pmt Clipper
volume and with high pricing now a larger part of the
Kristin
production goes to the domestic market. As a
consequence there has also been open space on the
North bound trade lane. 4.8 US Gulf to the Mediterranean and return
The USA market was reported to be saturated with The US Gulf / Mediterranean market stayed relatively
ethanol, even though domestic logistics lagged behind unaffected as compared to other routes until mid
production and therefore owners can expect more August where after a tangible slowing down was
ethanol flows from Brazil to the UK/Continent. reported.
Even so regular ethanol moves were still happening in Until then, the three regular owners were all reporting
July as various traders. (Shell / Coimex / Vertical / strong COA nominations with little spot space available
Integra / Noble etc) were all quoting 10-15,000 tonnes and outsider vessels were reported able to come on
ethanol from Brazil to USEC and Montreal on July 5-15 berth to fix available base cargoes at very reasonable
dates. Coimex fixed the “Jose Breeze” with 12 000 levels.
tonnes ethanol Santos / St. Croix on July 20- 30 in the
mid US$ 50's/t. Vertical was reported to be quoting a The recurring base cargo for many outsiders on the
COA for 8,000 tonnes ethanol per month for one year route has been ExxonMobil’s Exxpar from Houston to
starting in August 2007 from Brazil to West Africa. Augusta which is usually about 7,500 tonnes and vessel
reported to have taken advantage of this “starter” have
August and September saw the regular owners been the “Bruce Park” (13,940 dwt) loading first half July
improving contractual nominations southbound. Bulk in the low US$ 60’s/t and then the “Fairchem Filly”
chemical solutions took some time to fix their Munguba (19,995 dwt) fixed the next requirement it in the low US$
bound cargo on the MAPA controlled “Amalienborg” for 70’s/t.
6000 tonnes loading out of Freeport with a rate reported
to be around US$ 60/t. One broker reported a normally At the end of July/early August the “Fairchem Filly”
thinly trading spot market becoming extremely thin with (19,995 dwt) was forced to sail with approximately 3000
all three operators from the USG showing some spot tonnes space still open.
space and rates for 3,000-4,000 tonnes crept
downwards into the low US$ 70s/t. Chem-Tankers fixed the “Taviland“(22,717 dwt) from the
Mississippi River to the Mediterranean 10/17,000 tonnes
Whilst contract nominations turned out to be fairly vegetable oil and completed by filling with contract
healthy on the south bound trade, the north bound trade nominations.
lane was reported to be lacking volume both on spot and
contract nominations. In September Seatrans and Stolt-Nielsen offered their
regularly scheduled sailings but Chem-Tankers were
Jo Tankers fixed both their “Jo Cedar” (36,634 dwt) for reported to not have ship until early October. While the
early August loading and the “Jo Spruce” (36,782 dwt) market is still quiet and softening, it will be interesting to
loading end August with large base cargoes. The “Jo see whether the absence of Chem-Tankers for the

3Q2007
month will put a temporary hold on the declining freight In August arbitrage closed and there was hardly any
rates. The main brokers guess was that it would not be Benzene enquiry on the route from Asia to the US. While
there as there would be plenty of “outsiders” looking to trader enquiry for Benzene is now starting to emerge for
fill this void. first half of October positions to the US, it remains to be
seen whether any business will in fact be concluded.
4.9 Far East to Europe and USA
There have been several tenders for 8,000-9,000 tonne
There was a fair amount of activity in the route from the parcels of alkylates parcels from Taiwan to the USWC,
Far East to the Cont and US Gulf. This seemed to be but without the prospect of completion cargo, owners
because of the need to re-supply acids back to the west. have been hesitant to offer.
Cargoes seen fixed on these routes included Interchem
with 25,000 tonnes benzene from Ulsan to USG, off end Eitzen have reportedly fixed 3 voyages of 20,000 tonnes
July dates, at around US$53/t. . 1,500 tonnes Biodiesel for Wilmar from the Straits to USG-USWC
phosphoric acid was thought to have been fixed from options to be lifted in September, October and November
Jiangying to Barcelona, in the low US$150s/t. with freight estimated to be in the mid US$ 70’s/t.
Since the break-down of their Clear Lake Texas facility, Celanese Nanjing Acetic Acid Plant (600,000 T/A) has
Celanese have been active shipping in excess of 50,000 been operating smoothly since early June. BP/Yangtze
tonnes Acetic Acid to both Europe and the US from their Petrochemical JV Acetic Acid project (500,000
Nanjing and Singapore plants over the past two months, tonnes/year), also in Nanjing, has started construction
giving a lift to an otherwise dull market from Asia Trans- and is scheduled to be on-stream in 2009, while Jiangsu
Pacific. Celanese are now studying if they are going to Sopo Group in Zhenjiang also announced recently that it
continue to use their Asian plants to supply customers in is scheduled to bring on-stream additional 600,000
other regions and have tendered two short-term COAs, tonnes/ year acetic acid capacity in 2009 in its Phase III
one ex Nanjing and the other ex Singapore, in the expansion.
market to cover European and US destinations. Several
owners have reportedly offered, but no contract has It is estimated that by the end of 2009, China’s total
been awarded as yet and it is unlikely that these acetic acid production capacity will be expanded to 4.7m
shipments will continue in the long term due to the tonnes/year, among which the new capacity from
higher freight costs. Celanese Nanjing, BP/Yangtze Petrochemical Nanjing
and Sopo Zhenjiang together will reach 1.7m
While Bio-Diesel enquiry has been almost nonexistent, tonnes/year. China’s acetic acid apparent consumption
Benzene enquiry has remained slow but steady. in 2009 is estimated to reach 3.7m tonnes/year. Thus
Aurora’s” Selandang Gemala” reportedly parcelled up to by 2009, China is expected to change from an acetic
about 30,000 tonnes Benzene from Korea to the US acid net importing country to a very different net
Gulf for several charterers including SK and Kolmar off exporting country.
2H Aug. timing. The newbuilding, Sea Lion, fixed Vitol
for 12,000 tonnes BTX from South Korea to USG Representative fixtures: third quarter 2007
loading second half July in the low US$70s/t.
7,000 mts paraffin wax China/Baltimore US$ 145 pmt “Aigran D”
3 x 20,000 mts bio-diesel Straits/US Gulf/Atlantic Coast
Figure 4.7 Spot rates: Far East to Rotterdam US$ 75 pmt Eitzen tonnage
and US Gulf ($/mt) 25,000 mts benzene Korea/US Gulf low US$ 50’s pmt
7,500 mts chemicals Far East/Marmara Sea US$ 100 pmt
140 1,000 eur 1,000 usg 5,000 eur 5,000 usg “Golden Brilliance”
120
4.10 Regional markets
100
80 Stirrings in the regional markets can be important

60 indicators to the direction of global trade lane freight and
here we look at all the world’s most significant area of
40 commodity chemical growth in the Middle East, followed
20 by areas of great population where increased prosperity
3Q02 3Q03 3Q04 3Q05 3Q06 3Q07 drives demand leading to better prospects for the
Source: Drewry chemical tanker trade.

3Q2007
4.10.1 Middle East Gulf plans for the region. According to reports producers
have increased their captive tonnage carrying 7.2m
In July with the exception of some improved demand tonnes in 2006 compared to only 1.8m tonnes in 2001.
from WCI, the regional market was more or less at Estimates at the conference have 29.0m tonnes of
status quo in the Middle East. If there was tonnage additional volume coming online over the next 18
open and available it was generally because of reasons months, which remains to be seen. Either way, the
of age, approvals and previous cargoes. AG will have the greatest impact on future trading
patterns.
As for contracts, owners reported healthy volumes and
this was evidenced by little spot space available from Main Middle East ports
the regulars. Rates for semi-prompt cargoes going east
were definitely coming under pressure, whereas the We can supply our readers with more customised and
westbound volumes (often being more demanding on specific analysis of the main Middle East load ports,
approvals) seemed steady. commodities, owners, and what we may see as
opportunities, as an add on option to the chemical
Scheduling of chemical tankers became ever more forecaster at very reasonable cost and on a regular
problematic for end August - early September due to basis if required meanwhile we are able to give our
various unforeseen delays. This resulted in readers the following examples of the type and range of
cancellations of some spot fixtures, delayed deliveries to analysis available.
certain customers and uncertainties regarding available
positions 1-15 September. Jubail
Figure 4.8 Spot rates: AG to India, Singapore During 2007, Jubail continued to increase their
and Far East ($/mt) dominance over the other major operators, which is not
10,000 India 10,000 Spre 10,000 Ulsan
too surprising bearing in mind Odfjell’s reduced interest
70
in practically anything except South African destinations
60 and most other chemical operators reducing their shares
50 for apparently more rewarding trades. We may see this
changing next year as the other chemical trade lanes
40 have slipped as well as the CPP market.
30
In an attempt to be more competitive, and/or to make
20
more sense of commodity chemical rates, Iino Kaiun
10 added the zinc coated 37,000 dwt “Chemway Gaia” to
3Q02 3Q03 3Q04 3Q05 3Q06 3Q07 their mainly stainless fleet serving Europe, along with
Source: Drewry their other vessels to Rotterdam, including parcels to
Turkey, Greece, Malta and Italy, and the 45,000 dwt
There were however still quite a few smaller vessels Marineline coated “Chembulk Arrow” which is hauling
about for cargoes to WC India or SE Asia, and Ecofuel MEG to China.
fixed their usual 10,000 tonnes of MTBE from Jubail to
Taiwan for loading mid September, with contracted Stolt-Nielsen maintained their third position decreasing
owners apparently limiting the number of vessels for 20- their volume by around 5.0% and International Tanker
30 September where possible in an effort to balance out Management took over from Vela in holding the MTBE
the supply and demand during that period. domestic contract from Jubail to other Saudi ports on
their 46,000 dwt Chemical Oil vessel “Port Moody”. The
The big news in August was the reported Jubail total annual volume of products to date in 2007 is still
explosion that effected SabicGlycol production. This slightly less by 3.0% than 2006. The major differences
created pockets available on Stolt-Nielsen tonnage for have been a 27.0% increase in mono ethylene glycol
ex AG to the US Gulf. volumes and a 31.0% decrease in Caustic Soda solution
trade volumes.
The Marichem recently completed and the report from
the conference is that with the increased production in In 2007, IMC/Aurora and Tokyomarine have both cut
the region, several owners have significant expansion back their sailings from Jubail whilst the Klaveness
plans to service the new capacity. SH Marine, Eitzen, Cabu ships have increased the share of their reduced
Aurora, Iino, Odfjell, and Hanjin all have expansion volumes of Caustic Soda solution to Australia.

3Q2007
Figure 4.9 Total owner shares ex Jubail Figure 4.10 Products by volume Jubail
Jan-Jul 2007 Jan - Jul 2007, mt
Sabic Meoh
Iino Kaiun (Chem) MEG
Stolt-Nielsen
MTBE
International Tanker
Management SM
Tokyo Marine Caustic
Bakri Navigation EDC
Westchart A/S Mogas
Aurora Tankers
Cyclohex
Far East Transport
Odfjell-Seachem DEG
Lee Chang Yung Chemical 2-EH
Mitsubishi Gas Chemicals Benzene
Others Others
Table 4.2 Jubail exports Jan-July 2007 by

owner share, mt
Operator Total
Figure 4.11 Jubail by discharge area
Jan-Jul 2007
Sabic 1,667,008
Iino Kaiun 870,489 FE
Stolt-Nielsen 617,548 SEA
EUROPE
International Tanker Management 368,750 AG
Tokyo Marine 279,077 MED
AUSTRALIA
Bakri Navigation 276,016 INDIA
Westchart A/S 268,330 RSA
USA
Aurora Tankers 255,324 PAK
Far East Transport 213,579 SAFRICA
VENEZUELA
Odfjell-Seachem 196,170
RED SEA
Source: Drewry
Lee Chang Yung Chemical 193,816 EGYPT
Others
Mitsubishi Gas Chemicals 191,096
Others 1,769,981
Total 7,167,183
Table 4.4 Jubail exports Jan-July 2007 by
Source: Drewry area of discharge, mt
Table 4.3 Jubail exports Jan-July 2007 by Area Total

product, mt FE 2,672,884
SEA 1,056,562
Europe 761,452
Cargo Total
AG 708,968
Meoh 2,101,380
Med 529,446
MEG 1,696,047
Australia 336,048
MTBE 1,647,258
India 323,579
SM 440,930
RSA 280,076
Caustic 387,093
USA 157,586
EDC 200,918
Pakistan 134,971
Mogas 191,380
Cyclohexane 150,143 Safrica 65,621
DEG 127,173 Venezuela 61,166
2-EH 88,429 Red Sea 44,007
Benzene 54,962 Egypt 18,231

Others 81,471 (blank) 16,586
Grand Total 7,167,183 Grand Total 7,167,183

3Q2007
Figure 4.12 Jubail methanol by owner Jan-Jul 2007 (mt)
500,000
400,000
300,000
200,000
100,000
Stolt-Nielsen
Mitsubishi Gas
Chemicals
Iino Kaiun (Chem)
Chemical
Sabic
Lee Chang Yung
Mitsui & Co
Others
Far East Transport
Source: Drewry
It is interesting to note that IMC/Aurora are maintaining a Iran

no methanol policy for their liftings eastbound, leaving
this sometimes problematic cargo to other perhaps more Whilst we are still missing the May monthly volume from
dedicated ships. Bandar Imam Khomeini (BIK) which apparently had
production problems in that month, it is apparent from
Figure 4.13 Jubail methanol by discharge area the following table that the start up of export of methanol
Jan-Jul 2007 from the Assaluyeh plant will effectively double the total
exports of Iran chemicals by the end of this quarter. The
FE new Kharg expansion of methanol is fully up and
SEA running along with the Borzuyeh Petrochemical’s new
EUROPE aromatics facility in Assaluyeh and with a forecast 1.2m
MED tonnes of Benzene, Paraxylene, and Orthoxylene
INDIA
capacity there are interesting times ahead for all,
AG
particularly the owners.
PAK
EGYPT
To date Iranian exports have been dominated by Bandar
Source: Drewry Khomeini (BIK) with Assaluyeh maintaining a steady
Table 4.5 Iranian chemical exports Jan-June 2007 by port share (mt)
Month Assaluyeh BIK Bushehr Kharg Mahshahr Grand Total

January 107,751 17,698 64,248 6,369 196,066
February 127,241 15,717 38,339 181,297
March 178,868 18,947 83,333 10,596 291,744
April 103,500 203,845 12,791 48,316 368,452
May 132,000 14,237 48,905 195,142
June 97,000 145,585 19,995 47,299 309,879
Grand Total 332,500 763,290 99,385 330,440 16,965 1,542,580
Source: Drewry

3Q2007
Figure 4.14 Iranian exports by world area China imports methanol from Kharg and Assaluyeh on a
Jan-Jun 2007 broad mix of tonnage, many being around 10-13,000
dwt, 5,000 tonnes of Paraxylene moved from BIK to
MEGulf China with IMC/Aurora. Also, almost all cargo to other
FEast Far East ports was methanol too.
India
China
Europe The European side was being served by BLT,
Unknow n Serromah, SH Marine and Hanjin and is placing Far
Med East owners into the western hemisphere, with
SEAsia
methanol, slack wax, LAB, Paraxylenes and some
sulphuric acid on a Hanjin vessels.
Source: Drewry
We would anticipate more long range and hence more

Iranian exports by discharge area: Jan-Jun 2007
tonne/mile business in the long term.
Area Total
ME Gulf 585,889 Operator Total

Far East 312,234
Others 672,324
India 240,573
Unknown 135,556
China 112,516
Aurora 134,719
Europe 110,551
BLT 96,630
Unknown 95,916
Emirates 78,297
Med 70,317
Tanker Pacific 78,147
SEAsia 14,584
Mitsui OSK 58,160
Total 1,542,580
Samho 51,159
Iino Kaiun (Chem) 96,602
export share since April this year. The Middle East Gulf A Rheem 40,521
itself is still absorbing the major share of exports with Marnavi 35,997
base oils from Bushehr and benzene, naptha, heavy Bryggen 33,771
ends and condensate from the other ports to Bahrain,
Sinochem 30,696
UAE and Saudi ports, representing 38.0% of the total Total 1,542,580
exports so far.
Figure 4.15 Iranian exports by owner Jan-Jun 2007 (mt)
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
A Rheem
Bryggen
Unknown
Iino Kaiun (Chem)
Tanker Pacific
Marnavi
Others
Samho
Sinochem
Mitsui OSK
Emirates
BLT
Aurora
Source: Drewry

3Q2007
Iranian exports by product: Jan-Jun 2007 there was some activity, such as methanol cargoes
bound for India, coming from the Baltic, however this did
Product Total little to affect trade within NW Europe.
Methanol 783,150
Herning managed to find employment throughout the
Heavy End 188,055
month, with prompt available tonnage almost rarely
Naptha 157,805
available. They were usually looking to fix only a week
Benzene 108,182
or occasionally two ahead, but early in the month they
Base Oil 61,401
had been seen to fix up to three weeks ahead.
DPG 52,027
Toluene 26,805
Numerous plant shutdowns due to failure/maintenance
Condensate 26,000
did not help Statoil TBO, Sabic UK and Exxon, Fawley.
P.X. 19,683
COA liftings were steadier but in today’s market the
Others 119,472 COA freight level is still about 20.0% below the spot
Total 1,542,580 market.
Aurora tankers and BLT have been serving the Iranian The market slipped lower throughout August and the
trade for some time along with MEG regulars but as can North Sea was reported quieter than the Baltic with
be seen the very large range of owners featuring under some occasional lubes and styrene cargoes being seen.
“others” clearly demonstrates the essentially spot
coverage required. This is now expected to be In the Baltic, contract volumes were still visible and
converted into contracts which are currently being although spot fixing seems to have slowed somewhat,
negotiated. the rates were not too affected. Reformate cargoes
and some bio diesel were seen in the region and levels
4.10.2 Europe of enquiries raised a notch towards the end of the
month.
Throughout July, the NW European market continued in
much the same vein as the previous month, remaining Fixtures reported on this route included 3,500- 4,000
particularly uneventful. Early in the month there were tonnes of MTBE from ARA to Slagen, mid August dates,
very few spot fixtures noted both in the North Sea and on Clipper tonnage in the low to mid US$20s/t, which
the Baltic. Available cargoes seemed to be few and far was thought to be for Exxon. Styrene was heard fixed
between and the majority of voyages seen were regular from ARA to Rauma, off mid-August dates, at around
contract movements. Towards the end of the month $35/t Europe & US Gulf to Asia.
Figure 4.16 Iranian exports Jan-Jun 2007 by product (mt)
800,000
700,000
600,000
500,000
400,000
300,000
200,000
100,000
0
DPG
Toluene
Others
Naptha
Condensate
Benzene
Heavy End
P.X.
Methanol
Base Oil
Source: Drewry

3Q2007
4.10.3 Asia India’s palm market had more shipments being booked
for West Coast than East and cargoes loading from the
After a lack lustre July, the Asian regional markets Straits have maintained around US$28/t to the East
experienced a slight pick-up from the second half of the Coast and around US$33/t for 10,000 tonnes to the
month of August. The most notable recovery happened West Coast.
on exports from mid and north China where rates were
affected most probably associated with the export tax North East Asia
rebate cut this July.
Demand remained firm in NE Asia in spite of local
On the import side there was increased activities, partly holidays and rates were firm too, the same was true of
triggered by consumption of high inventory piled up cargoes north bound from SE Asia where several large
during the previous two months. Things were also slugs were reported particularly of pyrolysis gasoline to
stirring in the domestic markets where methanol for South China. Rates from Korea to mid China were
example, was traded much more actively under the around US$ 22/t.
increasing domestic prices. However, the macro-
economy of China was still reported to be on a fast lane Transhipments
to overheating, with no noticeable difference despite the
government’s attempts to make it cooler and sustainable. Intra NE Asia space was particularly tight for end
September positions with storms and typhoons featuring
Caustic soda was the largest exported chemical in terms and charterers were reported scouting for replacement
of volume for export, about 30,000 tonnes caustic soda vessels due to delays further south. Nevertheless, the
was fixed with Asian owners in August for export to transhipment market was somewhat subdued, and the
South East Asia while around 20,000mts was loaded in freight rates were reported as steady at around US$ mid
second half of the month for discharge in Canada. 20’s/t for 3,000 tonnes Ulsan anchorage to mid China
due to the lack of end September coasters.
More than 15,000 tonnes of Acetic acid was fixed for
export from either Nanjing or Jiangyin to Singapore, S.E. Asia Northbound
USA and South America. At least 3 shipments of
phosphoric acid were fixed from South China bound for While space on the SE Asia Northbound route was tight
Australia; Indonesia and Thailand shipments were in 2- for first half September dates, the level of spot enquiry in
4,000 tonnes lot. Several shipments of Ethyl Acetate the meantime dropped. COA volumes also declined and
were fixed in 1,000 tonnes size for Japan and there was ample part cargo space available for second
Philippines discharge. half timing. As a result, one broker reported seeing
some owners willing to discount rates to fill out ships
China’s palm oil market saw fewer activities but market and 3,000 tonnes chemicals from Singapore to South
sentiment remained unchanged, with ideas for 8,000 China at US$36.0/t.
tonnes loading East Malaysia/South China around US$
mid 20’s/t. NE Asia Southbound
Figure 4.17 Spot rates: Singapore to various The NE Asia southbound leg remained weak with larger
ports 3,000 mt easy chemicals parcels attracting numerous offers from owners. There
($/mt) was plenty of space available on this route and the
freight level for 5,000 tonne chemicals from Taiwan to
60 Bombay Ulsan Bangkok Singapore has now fallen well below US$20/t. On this
route Chevron reportedly fixed a COA with SU
50
Navigation, covering shipments of lube oils from Korea
40
to Singapore from January 2008.
30 SE Asia to WC India
20 The enquiry level on the route from SE Asia to WC India

was generally stable. Freight rates were largely
10
3Q04 2Q05 1Q06 4Q06 3Q07
unchanged, particularly with the market for 3,000
tonnes. Chemicals from Singapore to WC India were
Source: Drewry paying mid US$ 40/t level.

3Q2007
chemical forecaster veg oils, fats and molasses market
5. Veg oils, fats and volumes. There are long term factors that could
increase the ocean going trade to the detriment of
molasses market regional movements, particularly on sun oil and rape oil
that are being slowly but gradually being replaced by
palm oil.
5.1 Oils fats and molasses freight markets
Price increases over last year have been remarkable,
Demand for oils and fats is being checked by high taking average FOB prices in $ at origin, for example,
prices, and whilst consumption is reported to have 75.0% for sun oil, 70.0% for Tallow, and around 66.0%
slowed, recently it has not yet affected seaborne for palm oil.
Table 5.1 General oils fats and molasses freight rates ($/mt)
Trade Legs Product 3Q05 4Q05 1Q06 2Q06 3Q06 4Q06 1Q07 2Q07 3Q07
Straits-Rotterdam
25-30,000 Palm Oil 49 65 65 52 60 63 65 59 59
3/5,000 Palm Oil 55 70 72 62 70 68 70 67 65
1000 Palm Oil 62 75 80 70 80 80 85 80 80
Straits/Turkey
7-10,000 Palm Oil 52 70 70 56 65 75 75 72 72
Straits-India Ocean
6,000 W.C.India Palm Oil 29 27 28 29 40 37 43 33 30
6,000 E.C.India Palm Oil 25 22 23 24 38 31 39 30 29
15/22,000 Pakistan Palm Oil 26 26 27 26 40 32 42 33 30
25,000 E.C.Africa Palm Oil 38 38 37 36 42 38 42 38 36
South America/various
25-30,000 China Soy/Sun 48 62 58 48 50 49 70 77 60
30,000 Karachi Soy/Sun 47 55 50 42 50 45 60 70 60
30,000 WC India Soy/Sun 46 54 48 42 46 45 62 71 59
30,000 EC India Soy/Sun 48 56 48 47 48 45 60 72 60
25,000 Bangladesh Soy/Sun 48 55 50 47 50 45 58 70 60
25,000 E.Med Soy/Sun 48 55 50 45 50 48 63 67 57
20,000 Black Sea Soy/Sun 55 60 55 52 50 48 65 68 56
20,000 S.Africa/India Soy/Sun 50 50 50 45 55 50 65 68 62
15,000 Caribbean Soy/Sun 40 42 50 45 50 47 58 68 40
15/20000 WC SAmerica Soy/Sun 52 60 60 55 50 45 68 80 50
7/8,000 N.Africa Soy/Sun 70 70 70 68 60 60 70 72 65
4,000 West Africa Soy/Sun 65 70 70 68 70 70 70 72 70
35,000 Iran Soy/Sun 42 42 40 42 40 33 42 65 50
20,000 Rotterdam Soy/Sun 48 58 58 48 48 48 60 63 59
US Gulf-various
10-15,000 China Soya Oil 68 65 63 62 62 62 70 70 65
15,000 E.Med Soya Oil 48 48 52 52 52 52 65 65 55
25,000 India or Pakistan Soya Oil 68 65 50 52 52 52 85 85 75
Canada (Vancouver)
10,000 China/SE Asia Rape Oil 42 40 42 42 45 45 45 44 45
Pakistan
28,000 Continent Molasses 35 45 45 36 38 39 39 39 43
20,000 Taiwan Molasses 24 28 28 27 30 30 38 36 35
East Africa
21,000 Med/Cont Molasses 36 36 36 35 38 45 48 48 47
Source: Drewry

3Q2007
For 2008, demand is likely to be met by improved Malaysian palm output is up 16.0% from a month before
production of palm oils. Present world oils and fats July, much above normal and could be the beginning of
reserves are expected to be drawn down to around the reversal in the yield cycle, whilst soya bean
16.0% of production, the lowest for many years. production is forecast to rise 3.0% next year with
demand increase at 5.8%.
Lower than expected, production of oil seed crops in the
Northern Hemisphere, due to the replacement of winter Compared to the main chemical and CPP markets, oils
rapeseed crop with wheat, the removal of EU set aside and fats freight have been relatively steady but
restrictions, and demand for biodiesel, is expected to weakening.
lead to a shortage that can only be to the advantage of
palm oil, and other soft oils. Historically, soft oil freight, with the exception of the last
few months leading up to 1st January 2007 (as the
Unless ideal weather and high crop yields ensure unqualified ships fixed their last voyages), has been
satisfactory growth and demand for fuel use is curbed, observed to track the vagaries of the CPP market albeit
Oil World reports that we could see a food crisis on the with a lapse of a few months behind the peaks and
not too distant horizon. OPEC clearly intends to troughs.
maximise returns on mineral oils with a $90/bbl, or even
up to $100 being touted. Since the new rules took effect at the beginning of this
year, we have not seen any dramatic change despite the
Despite these price increases, combined G3 CPP markets, especially Transatlantic, falling to their
(US/Brazil/Argentina) soya oil exports were reported lowest in 4 years. It is perhaps too early to determine
close to 2.0m tonnes in June and July, up 35.0% from a whether this link is not so effective anymore, but we
year ago, with cumulative exports between October/July could see the CPP owners of modern tonnage less
at 7.7m tonnes, up 9.0% from a year ago. willing to swing into oils and fats, whilst those servicing
the trade will become “dedicated”.
Decline in sun seed production in the Black Sea and
elsewhere, due mainly to severe drought, is One broker reports that the general consensus among
unprecedented and the European crop has declined by shipowners was that the winter CPP market is around
30.0% to only 4.5m tonnes, which has not been too the corner and activity will pick up in the near future, and
supportive to the dedicated tonnage in the that when October bookings start taking off, and
Mediterranean. coincide with the expected increase in mineral oil
business, rates may well be moving back upwards. The
Russia reduced import taxes on palm and lauric oils tropical oil market to Europe has stayed fairly constant,
from 5.0 to zero for the next 9 months due to tight sun oil although slipping around 1.0% over the quarter and
supplies, which will support tropical oil imports. around 4.5% over this time last year.
Figure 5.1 2001-2007 main commodity trade lanes (US$/T)
Palm Straits Europe Soft Oils Arg/Bzl-Ind/China Molasses General
80
70
60
50
40
30
20
3Q02 1Q03 3Q03 1Q04 3Q04 1Q05 3Q05 1Q06 3Q06 1Q07 3Q07
Source: Drewry

3Q2007
Soft oil rates out of South America slipped lately by $40's/t level for 20-25,000 tonne parcels to Caribbean
around 17.% but are still up 6.0% over the same period destinations.
last year.
Regular Ethanol moves were still happening in July as
5.1.1 Ocean trade lanes summary various traders (Shell/Coimex/Vertical/Integra/Noble)
were all quoting 10-15,000 tonne parcels from Brazil
Over the third quarter, with a four year low clean to USEC/ Montreal on July 5-15 dates, with a COA
petroleum market in the Atlantic Basin, we have seen a ship running late. Coimex fixed “Jose Breeze” with
softening of global oils and fats rates, although the 12 – 14,000 tonnes of Ethanol Santos/St. Croix on
tropical oil lane from the Straits to Europe as well as the July 20-30 at around mid $50's/t. A trader fixed
USA has proved more stable. “Vega Spring” with 12/15,000 tonnes of Ethanol Santos/
USAC, on July 18/22. Vertical was quoting a COA for
Soft oil was coming under pressure from July, as the 8,000 tonnes of Ethanol per month for one year starting
Argentinean energy crisis drew markedly more handy in August 2007 from Brazil to West Africa.
size vessels importing gas oil thus increasing the
number of ships looking for employment against a A number of elderly vessels are reported to be still
collapsing CPP market in the Atlantic, where rates moving Ethanol and aromatics in their wing tanks whilst
dropped to the lowest since 2002. still working soft oils and palm in centre tanks only,
although these vessels have been noted heading to
The rates for 38,000 tonnes of CPP moving from the scrapyards as special surveys and annual dockings fall
Caribbean/USAC fell from the WS190-200 range down due.
to WS130-140, as the month came to a close. The rates
for 37,000 tonnes of CPP moving from the Continent to The palm oil market to Europe has seen very little
the USAC also drifted downward steadily from WS200- movement over the last couple of months. Infact one
190 to WS150-160. As a consequence, freight rates to broker commented you could count the amount of spot
India and China were only paying high $50’s/t to low fixtures on one hand, as the majority of requirements is
$60’s/t into September. of course now being covered under contracts.
Less drastic but still significant, reductions were seen in Peruvian fish oil traders did little in the month of August,
the South America to WCSA destinations - declining meanwhile a number of charterers were reported to be
from mid/high $50's/t level to high $40's/t level for 20- looking at 10,000 tonnes of Fish Oil from New Orleans
25000 tonnes, and from mid/high $50’s/t level to mid/low to Chile for October shipment. The next export season
Representative palm rates: third quarter 2007
Champion Star/Cargill 47,000 T/C Trip Del Fareast/Redel USA US$25K
Sten Aurora/ICOF 16,600 Palm/oleos Straits/Rotterdam US$65/67.00 2/1
Botany Troubadour/EDF 11,300 Palm oil Straits/West Africa US$ 90.00 ies
Oriental Freesia/Cargill 13,500 Palm oil Straits/Pakistan US$ 33.00
Nordic Helsinki/Cargill 11,500 Palm oil Straits/Canada rna
Bunga Melati/Wilmar 2,000 M.Ester Straits/Rdam US$ 70/72.00
Maersk Borneo/Equatorial 25,000 Palm oil Straits/E+S Afica US$ RNA
Shintoku/Wilmar 17,000 Palm oil StraitsWC India US$ 30.00
Havi Ocean/VVF 7,300 Palm oil Straits/WC India US$ 31.50 (Aug)
Bunga Melati 4/Kwantas 12,000 Palm oil Emal/Pakistan US$ RNR
Symphony 1/Wilmar 35,000 Palm oil Straits/Med options US$ 50IES 2/2
Global Flora/ICOF 10,000 Palm oil Straits/ECIndia US$ 29.00
Valdemars Krisjanis/Weco 37,300 T/C Trip Del Fareast/Redel Rdam US$ 20,500 pdpr
Team/Kemoleo 20,000 Palm oil Pelintung/New Haven US$ 71.00 1/1
Integrity/Cargill 44,000 Palm oil Straits/USA US$ 71.00 3/2

3Q2007
from Peru to Europe is expected to be at the end of However, this was tempered, as high commodity prices
October. continued to dampen demand.
The tallow export market was equally quiet. There was Nevertheless, freight rates to WC India firmed with
reportedly 4,000 tonnes of tallow done by Jacob Stern 15,000-20,000 tonnes from Straits reaching about $30/t
from Houston to Dakar for mid September loading with basis 1/1. Owners were trying to hike freight levels
freight ideas in the low $70’s/t. At the same time, Cargill further into the mid $30s/t due to high bunker prices,
booked 5,000 tonnes of tallow from Houston to although, with a number of ships available for
Casablanca for the same position on Clipper Wonsild September dates charterers were resisting.
tonnage with freight ideas in the mid $60’s/t. Freight
ideas for 2, 500 tonnes from New York to Port Au Freight rates for cargoes into China also picked up by
Prince, Haiti had remained in the mid $40’s/t. 2, 000 about $2-3/t with the market currently in the high $20s/t
tonnes of yellow grease was done from Quebec to for 8,000-15,000 tonnes from Straits to Mid China, while
Barranquilla with freight ideas in the mid $70’s/t. Freight a 24,000 tonne parcel was fixed at $29/t basis 2/1 from
rates for 4,000 tonnes From Portsmouth NH to Straits to N. China off end July dates.
Venezuela were reportedly in the mid $40’s/t.
5.2 Production/exports
The deep sea molasses trade mainly focused on Indian
exports which were now more competitive with Pakistani In Table 5.2 of forecast World production figures from
or Thai origins for both Europe and Asian destinations. Oil World, we have attempted to estimate total volumes
With the West CPP market weak with t/c earnings of oils and fats moved by sea by the year 2008 and our
around $12,000/day, many owners preferred to stay latest estimation indicates that there will be around
East of Suez. Traders were looking at high $30’s 1/1 60.0m tonne.
basis 35,000 tonnes of cargo from WC India / Karachi
range finding few takers with chemical tonnage booked It is also interesting to note that according to our
out on contract commitments creating a real shortage in methodology the average per annum percentage
available molasses space. increase in the amount of oils and fats moved by sea are
approximately twice that of the increase in production on
Molasses activity remains strong this year, and exports a per annum basis.
are expected to exceed last year’s figures. Last year
estimated export figures were: 1,130,000 tonnes EU – In the 2008 season the production growth (vs. 2007) of
750,000 tonnes Africa – 1,400,000 tonnes Americas – the 13 major vegetable oils and fats combined is
2,400,000 tonnes India/Asia. The Indian market has forecast at 3.5%, up from 2.5% in 2006/07/8 of the three
gone from 5,000 tonnes in 2004 to 62,000 tonnes in year average. Combined production of the 4 major
2005, and it is expected to export 1,000,000 tonnes this animal fats increased by only 2.2% over the last three
year. years.
In September one major broker reported that Far East Looking at the individual oils, palm will be the leader at a
markets have been a lot busier recently, and freight 3-year average growth rate of 5.5%.
levels to India and China were slowly creeping upwards
although they are still a long way off their highs. They The recent price escalations are obviously affecting
had seen a lot more spot business traded in the market, demand. In particular, many players in the biofuels
which is a positive sign that consumers are back in sector have adopted a wait-and-see attitude, hoping for
purchasing mode and this may lead to a more active a more favourable price ratio between vegetable oils
4th quarter – fingers crossed. and crude mineral oil. The ratio has clearly checked the
use of vegetable oils as energy source. Consumption of
5.1.2 Regional trade lane summary oils & fats is also suffering in the food sector at current
prices, particularly in low income countries.
In Asia, while palm oil prices came off slightly in July,
ending the month at about $797/t FOB Malaysia, prices In China, the demand growth has been outstanding so
remain at high levels. far this season, leading to sharply rising imports of
oilseeds, oils & fats. Oil World forecast the total growth
As expected, the palm oil freight market experienced a in Chinese demand for oils & fats at 1.6m tonnes in
seasonal upturn ahead of the Ramadan and Diwali. Oct/Sept 2006/07, against 1.4m tonnes last season.

3Q2007
Table 5.2 17 oils and fats: world production by type and estimated volumes by sea (MnT)
Oils & Fats and Sea Transport Estimates 2005-2008 % Change per Year
Prod Prod By Sea By Sea
Oils 2008 f By Sea f 2007e By Sea e 2006 By Sea
2008 3 Yrs 2008 3 Yrs
Soya oil 38 9.9 36.7 9.2 34.9 8.7 3.50% 2.90% 7.60% 4.40%
Palm oil 42 31.9 38 27.7 36.1 25.3 10.60% 5.50% 15.10% 8.80%
Rape oil 18.8 6.4 18.4 6.4 18.2 5.4 2.10% 1.20% -0.90% 5.80%
Sun oil 10.7 2.7 12 3.6 11 3.3 -10.70% -0.80% -25.60% -6.20%
Cotton oil 4.5 0.7 5 0.8 4.9 0.7 -10.00% -2.50% -10.00% -2.50%
GNO 4.2 0.9 4.2 0.9 4.6 1 0.00% -2.90% 0.00% -2.90%
Olive oil 3.1 0.5 3 0.5 2.7 0.4 2.00% 4.70% 2.00% 4.70%
Sesame 0.9 0 0.9 0 0.9 0 0.00% -0.40% 0.00% -0.40%
Corn oil 2.4 0.2 2.4 0.2 2.2 0.2 3.00% 3.00% 3.00% 3.00%
Coconut oil 3.1 2 2.9 1.9 3.2 2.1 5.20% -1.80% 5.20% -1.80%
PKO 4.7 2 4.4 1.8 4.2 1.7 5.90% 3.90% 11.10% 5.70%
Linseed oil 0.7 0 0.7 0 0.7 0 0.00% 0.50% 0.00% 0.50%
Castor oil 0.5 0.1 0.5 0.1 0.5 0.1 0.00% -0.60% 0.00% -0.60%
Fats 25.5 2.8 24.5 2.7 23.9 2.6 4.20% 2.20% 4.20% 2.20%
Total 159 60 153.6 55.8 148 51.6 3.50% 2.50% 7.60% 5.40%
f=Forecast, e= estimated
Source: Drewry
5.2.1 Malaysia China is the largest known area of discharge with

around 16.0% of the quantity exported compared to
We apologise that our Malaysian source of cargo Europe in second position with 13.0%. NE Asia remains
loading information is still being reorganized and for this the largest area of discharge with around 2.8m tonnes
issue we repeat the analysis of the first five months of with over 2.0m tonnes discharged in China.
2007, for those readers unfamiliar with this trade leg,
they represent more or less the market shares today. GMS Lines maintained their clear position as number
one in volume amongst the Owners with contractual
Table 5.3 Malaysian palm oil exports by services from Sabah and Sarawak for Shippers such as
discharge area Jan-May 2007 (mt) Lahad Datu Edible Oil, Taiko, Unitata, and Felda to
China, Taiwan and Japan, using their 7,700 dwt - 13,000
dwt IMO II double hull vessels such as “Global Flora”,
Area Total “Hilda”, “Juno”, “Mar”s, “Neptune”, “Saturn” and “Triton”
Unknown 1,783,515
China 787,380 Figure 5.2 Malaysian palm exports
Europe 642,526 Jan-May 2007
Indian Ocean 464,482
Americas 317,442 Unknow n
Mid East 267,947 China
Europe
F.East 244,510 Indian Ocean
SEA 165,964 Americas
Mid East
Med 140,111 F.East
Africa 94,503 SEA
Med
Others 42,314
Africa
Total 4,950,693 Others
Source: Drewry
Source: Drewry

3Q2007
Figure 5.3 Malaysian exports by owner Jan-May 2007 (mt)
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
Stolt-Nielsen
STX Panocean
Koyo Kaiun
SH Marine
Sanpo Unyu
Champion
Pacific Carriers
Handytankers
Kwantas
Others
Odfjell
GMS Lines
MISC
Zhu Chang
Barclay
China Shipping
Glory
Jo Tankers
Haisheng
Wilmar/Raffles
Tokyo Marine
Source: Drewry
Table 5.4 Malaysian palm exports by operator whereas Tokyomarine maintained their Middle East and
Jan-May 2007 (mt) European Services.
Tokyomarine used their smaller 9,000 dwt vessels such

Operator Quantity as “Eastern Amenity” and “Eastern Bright” with regular
GMS Lines 974,823 parcels to Jebel Ali in the United Arab Emirates, and
Sultan Qaboos in Oman, with shippers such as Wilmar
Tokyo Marine 809,947
MISC 783,724
and Pasir Gudang Edible Oil (PGEO). Their larger
25,000 dwt vessels continued their combination of
Stolt 732,808
specialised grades (often 20 or more) to Aarhus and
Odfjell 341,134
Karlshamn, along with Oleochemicals and biodiesel to
Glory 326,756
NW Europe.
Sampo Unyu 218,532
Kwantas 210,585 Stolt-Nielsen maintained their third position in the
Panocean 208,060 exports of Malaysian Palm Oil including with regular
Guangdong Pearl 205,951 services to Europe and the United States East Coast
Samta 201,141 and Gulf, also covering contractual movements into
OMI 167,905 South Africa en route to Brazil, with occasional
Megaports 164,366 combinations to Mauritius and Madagascar.
Smooth Sea 103,641
Champion Tankers seemed to concentrate more on the
Bryggen 102,393
Black Sea and Ukrainian movements, likely positioning
Jo Tankers 100,607
for further UAN shipments out of that area to position for
Siam Mongkol 99,848
further Oils and Fats business out of South America.
Koyo Kaiun 99,134
SH Marine 95,305 We continued to see the emerging dominance of the
Interorient 93,900 East Malaysian ports in volume for export as Lahad
Others 2,744,750 Datu and Sandakan pushing past Pasir Gudang, and
Total 7,810,487 even Port Kelang now relegated to fourth position as
Kuantan challenged just behind it in volumes swelled by
Source: Drewry
its Oleochemical capacities.

3Q2007
Figure 5.4 Malaysian palm load ports Jan-May 2007 (mt)
1,000,000
800,000
600,000
400,000
200,000
0
Bintulu
Tawau
Port Klang
Sandakan
Kuching
Lahad Datu
Pasir Gudang
Kuantan
Penang
Lumut
Source: Drewry
5.2.2 Indonesia Table 5.5 Indonesian exports by operator

Jan to Sep 2007 (mt)
Indonesia has become the world’s largest producer of
palm oil with 16.1m tonnes in calendar year 2006, for
Operator Total
the first time surpassing Malaysian production (15.9m
tonnes). Wilmar/Raffles 681,633
GMS Lines 585,585
For calendar year 2007 Oil World estimate Indonesian Handytankers 504,298
production to increase to 17.0m tonnes, while Malaysia Champion 302,776
is likely to suffer a decline to 15.5m tonnes. Glory 241,021
Bryggen 227,506
The ports of Dumai and Belawan continue to dwarf the Sinochem 218,820
dozen or so Indonesian palm loading ports, but we are Odfjell 198,876
starting to see volumes increasing in Lubung Gaung and Tokyo Marine 196,205
Padang as new estates come on stream. Stolt-Nielsen 194,791
MISC 173,690
It continues to be evident that the vast amount of
SK Shipping 173,641
Indonesian palm oil moves on a spot basis and of the
Hong Lam 161,223
relatively few contracted owners we are seeing
Tatsumi 154,531
Wilmar/Raffles overtaking Handy Tankers, as their fleet
STX PanOcean 151,386
gets sorted, by conversions and new buildings, brought
Jo Tankers 137,629
in to replace the old unsuitable tonnage to service
Ama Marine 136,355
China, India and Mombasa.
Clipper-Wonsild 133,216
GMS lines maintain their regular services in second Torm 125,198
position whilst Handytankers continued their contract Others 3,763,009
with Josavina from Padang to Mombasa with the “Brigit Grand total 8,461,388
Maersk” and the support of Pacific Interlink to use space Source: Drewry
on their new building deliveries.

3Q2007
Table 5.6 Indonesian exports by load ports Jan-Sep 2007 (mt)
Month Jan 07 Feb 07 Mar 07 Apr 07 May 07 Jun 07 Jul 07 Aug 07 Sep 07
Load Port
Belawan 205,685 174,832 237,469 277,007 247,844 234,059 231,197 294,935 300,369
Belinyu 4,650 1,500 0 3,750 0 0 2,250 3,200 2,600
Bitung 45,000 48,250 45,095 43,926 67,236 26,700 18,450 62,455 25,400
Dumai 253,542 363,113 337,647 376,928 325,723 363,686 279,254 317,251 355,200
Kuala Enok 0 0 0 0 0 0 0 0 0
Kuala Tanjung 90,759 68,064 81,782 80,492 106,273 70,059 42,306 92,360 102,453
Lubuk Gaung 20,110 35,399 63,137 57,548 86,766 54,517 100,648 63,306 38,138
Padang 49,834 95,869 108,169 105,125 83,364 105,193 102,580 72,006 62,834
Palembang 22,796 14,114 40,447 48,302 60,918 25,387 34,548 21,793 19,749
Panjang 53,471 27,768 39,683 30,051 29,133 48,071 26,978 59,530 52,563
Pelintung 0 0 56,000 10,000 48,860 12,000 15,000 0 0
Rengat 0 0 0 0 0 0 0 0 0
Tanjung Priok 5,871 7,975 1,500 4,450 11,050 7,035 1,500 3,550 6,000
Total 751,718 836,884 1,010,929 1,037,579 1,067,167 946,707 854,711 990,386 965,306
Source: Drewry
Figure 5.5 Indonesian exports by discharge area Jan-Sep 07 (mt)
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
Black Sea
Indian Ocean
MEG
Nafrica
NWEurope
Samerica
Red Sea
Coastal
Med
Safrica
Wafrica
Feast
China
USA
Americas
Eafrica
SEA
Source: Drewry

3Q2007
Table 5.7 Indonesian exports by discharge Table 5.8 Brazilian exports by region
area Jan to Sep 2007 (mt) Jan-Sep 2007 (mt)
Area Total Area Total
Indian Ocean 3,459,231 Europe 310,122
NW Europe 1,434,372 China 297,152
China 1,235,734 India 295,047
SEA 553,899 Iran 293,958
Eafrica 451,210 Africa 198,674
Med 387,789 Med 87,488
Red Sea 264,054 C.America 73,586
Black Sea 245,995 Ind Ocean 57,560
Safrica 173,096 SEA 39,709
MEG 83,833 FE 25,459
Nafrica 58,592 Others 22,000
USA 50,999 Grand total 1,700,755

Samerica 35,906
Source: Drewry
Americas 10,028
Wafrica 6,500
Coastal 5,200
Feast 4,950
Grand total 8,461,388

Table 5.9 Brazilian exports by owner
Source: Drewry Jan-Sep 2007 (mt)
Owner Quantity(mt)
The Indian Ocean area continues to be the major Odfjell-Seachem 250,556
destination for Indonesian palm oil, whilst Europe and Champion Tankers 135,816
China also maintain their respective positions, with the Stolt-Nielsen 87,620
Mediterranean destination increasing its volumes. Eitzen (Sokana) 83,477
Norient Product Pool A/S 76,097
5.2.3 Brazil Warm Seas Development & Trading 68,338
OSG Group 66,073
We have now found a more reliable source for Brazilian
STX Pan Ocean Shipping 51,459
statistics and lay out below the Brazilian oils and fats
Dileton Maritime 49,897
exports for January through September this year.
Sea Power 47,000
Combined exports of vegetable oils consisting of crude Product Transport (S) 45,860
and refined soya bean oil, Ground nut oil, cotton seed oil Poseidon 45,795
and maize oil from Brazilian ports from January 2006 to Weco 45,117
and including September came to over 1.7m tonnes. Parakou Shipping 42,622
Protrans 41,100
Over 2006 January to September Europe has been the Barclay Shipping 39,935
single largest destination with 18.0%, whilst China, India Besiktas Denizcilik 32,985
and Iran follow close behind.
Sea World Management 31,000
Handytankers 26,174
As mentioned in 2006 the increased volumes to NW
Clipper Wonsild Ocean Going 25,482
Europe should continue in the future paying good rates
to owners, but we then wondered if the Odfjell older Others 408,352
single hull ships “Bow Maaslot” and “Bow Maastroom” Grand Total 1,700,755
would have to withdraw as they only have less than

Source: Drewry
10,000 cubics of IMO 2 space?

3Q2007
Figure 5.6 Brazilian exports by discharge area Jan-Sep 07 (mt)
400,000
350,000
300,000
250,000
200,000
150,000
100,000
50,000
C.America
China
Indian Ocean
Coastal
Africa
Europe
Unknown
Australia
Med
Iran
Feast
SEA
Source: Drewry
However, they have continued working their part space Meanwhile Stolt-Nielsen has regular sailings for their
in parcel fashion, although we feel they are also using US/Brazil to Mediterranean service utilising the 19,900
IMO III space which in their configuration effectively dwt stainless “Stolt Nanami” with parcels to Greece,
gives double hull. Ethanol exports are a natural fit in the Israel, Turkey and Black Sea.
wing tanks of these elderly ships too. Most of their
volume is however now being taken up by more modern The second biggest lifter is now Champion Tankers with
ships, which confirms that this major operator is there to their growing fleet of double hulled vessels, including
stay on this trade route. their conversions. Meanwhile Iran is being served by
Figure 5.7 Brazilian oil exports by owner Jan-Sep 2007 (mt)
500,000
400,000
300,000
200,000
100,000
0
Norient Pool A/S
Barclay Shipping
STX Pan Ocean
Besiktas Denizcilik
Parakou Shipping
Odfjell-Seachem
Dileton Maritime
Eitzen (Sokana)
Handytankers
Stolt-Nielsen
OSG Group
Sea Power
Poseidon
Protrans
Clipper Wonsild
Sea World
Others
Weco
Warm Seas
Product Transport (S)

ChampionTankers
Source: Drewry

3Q2007
Figure 5.8 Brazilian exports by charterer/ either Barclay or Handytankers with modern ships, or
shipper Jan-Sep 2007 (mt) more often with vessels over 25 years old albeit with
IMO III double hulls, for example the “Doroussa” and the
Bunge “WS Challenger”.
Concordia
Dreyfus
Glencore Bunge continues to dominate the shipments of oils out
Csrgill of Brazil with to date over 40.0% of the volumes
Intertrade
Toepfer shipped.
FRWaring
Imcopa 5.2.4 Argentina
Noble
ADM
Equatorial The current annual biodiesel production capacity is 0.4m
Others
tonnes. Two ships carrying a combined 19,000 tonnes
Source: Drewry of biodiesel left Argentina in the first half of August to
Rotterdam. A third ship with 15,000 tonnes was
scheduled for Aug 23.
Table 5.10 Brazilian exports by charterer/

shipper Jan-Sep 2007 (mt) Table 5.11 Argentinean exports by region
Jan-Sep 2007 (mt)
Charterer/Buyer Total
Bunge 691,641 Area Total
Concordia 303,192 China 1,601,514
Dreyfus 155,237 Ind Ocean 1,386,449
Glencore 130,531 SAM 604,457
Cargill 104,254 N.Africa 386,571
Intertrade 44,685 Africa 358,086
Toepfer 44,270 Europe 257,207
FRWaring 38,000 Med 193,702
Imcopa 29,238 SEA 185,398
Noble 27,800 FE 168,670
ADM 26,115 USA 38,140
Equatorial 25,868 VARIOUS 27,500
Others 79,924 Australia 23,345
Grand total 1,700,755 Grand total 5,231,038
Table 5.12 Argentinean exports by load port Jan-Sep 2007 (mt)
Grand
Port Jan Feb Mar Apr May Jun Jul Aug Sep Total
Bahia Blanca 14,310 5,000 19,400 29,700 29,800 9,895 23,830 60,100 18,109 210,144
Dock Sud 2,000 2,000
Necochea 4,000 26,000 38,188 13,075 24,848 17,000 3,000 42,300 168,411
Rosario 31,035 52,993 79,420 118,350 76,013 99,929 79,476 54,572 591,788
San Lorenzo 203,462 516,412 455,425 391,352 507,875 586,803 607,712 533,202 456,453 4,258,696
Grand Total 221,772 552,447 553,818 538,660 669,100 697,559 748,471 675,778 573,434 5,231,038
Source: Drewry

3Q2007
Figure 5.9 Argentina exports by discharge area Jan-Sep 2007 (mt)
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
Australia
SAM
FE
N.Africa
Various
SEA
Europe
Africa
China
Ind Ocean
Med
USA
Source: Drewry
Figure 5.10 Argentina exports by charterer/shipper Jan-Sep 2007 (mt)
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
0
TOEPFER
CARGILL
TRANSGRAIN
EQUATORIAL
BUNGE
Others
WILMAR
GLENCORE
KUOK
DREYFUS
NIDERA
Source: Drewry

3Q2007
Figure 5.11 Argentina oil exports Jan-Sep 2007 by owner (mt)
1,800,000
1,600,000
1,400,000
1,200,000
1,000,000
800,000
600,000
400,000
200,000
(Chem)
Jo Tankers
Delfi
A/S
Torm
Others
Weco
Tomasos
Berlian Laju Tanker

Norient Product Pool
D'Amico
Champion Tankers
Eitzen (Sokana)
Chembulk
Fairfield
Marphocean
OSG Group
Handytankers
Stolt-Nielsen
Odfjell-Seachem
Parakou Shipping
Kjelman Shipping
Byzantine Maritime
Source: Drewry
Table 5.13 Argentinean exports by owner/ In June, about 4,000 tonnes of biodiesel was exported to
operator Jan-Sep 2007 (mt) the USA at a price of $700/t, fob. In Argentina, biodiesel
enjoys a preferential export duty of only 5.0% (of which
2.5% will be refunded later), compared to an export tax
Chart Total
of 24.0% in the case of soya oil.
Champion Tankers 459,853
Handytankers 352,240 5.3 Production and demand
Stolt-Nielsen 299,771
OSG Group 289,881 Much of the steep price increases seen in the oils and
Delfi 242,807 fats markets have been the result of a possible severe
Weco 241,422 divergence of the supply and demand trends this year
Odfjell-Seachem 201,524 and into next season.
Eitzen (Sokana) 174,173
Chembulk 140,930 In 2007/8 supplies of oilseeds are bound to be limited by
Norient Product Pool A/S 140,360 the loss of acreage to grains, whereas the demand base
Tomasos 123,027 for oils and fats expands due to population growth, rising
Fairfield 120,510
per capita demand in the food sector and numerous new
biodiesel plants that would need feedstock.
Parakou Shipping 115,775
Marphocean 115,136
5.3.1 EU-25
Byzantine Maritime 114,340
Kjelman Shipping 97,025
In the European Union oils and fats demand slowed
Torm 85,000
down during the second quarter but was still significantly
D'Amico 82,620
above the year-ago levels. The biofuels sector remains
Jo Tankers 79,015
the driving force behind the further uptrend of imports
Berlian Laju Tanker (Chem) 72,750
but primarily in the case of soya oil and rape oil.
Others 1,682,879
Grand total 5,231,038 Combined imports of soya oil, sun oil, rape oil and palm
oil reached 1.96m tonnes in Jan/March 2007 (plus 0.2m
Source: Drewry
tonnes), following 2.15m tonnes in Oct/Dec 2006

3Q2007
Figure 5.12 Change by year in world production & demand 2000-2008 (MnT)
Production Demand
10
0
2000 2001 2002 2003 2004 2005 2006 2007 2008
Source: Drewry
(plus 0.6 million tonnes). In Jan/March 2007 imports of European rape oil prices were under pressure until April,
palm oil rose 6.0% on the year, of soya oil 25.0% and linked to a slowdown of demand mainly from the
those of rape oil even more than doubled to 234 German bio diesel industry. This has curbed the
thousand tonnes. Sun oil imports, however, declined by profitability of rape oil imports from third countries.
9.0% and the reduction will become larger in April/Sept
owing to the severe tightening of export supplies in key Soya oil imports are seen reaching 1.03m tonnes in
countries. Oct/Sept 2006/07, up 0.25m tonnes on the year.
Demand for refined soya oil as bio fuel has suffered in
EU imports of rape oil slowed down notably to around 40 Germany due to new standards introduced in January,
thousand tonnes in April, compared to monthly volumes but in other EU countries demand from this sector is still
of 50-120 thousand tonnes registered since mid-2006. comparatively strong.
Figure 5.13 EU oils and fats imports (’000 T)
11,000
10,000
9,000
8,000
7,000
6,000
5,000
2001 2002 2003 2004 2005 2006(F)
Source: Drewry

3Q2007
Figure 5.14 EU-25: imports of oils and fats (‘000 T)
2001 2002 2003 2004 2005 2006

5,000
4,000
3,000
2,000
1,000
Tallow/Grease
Castor Oil
Soybean Oil
Olive Oil
Fish Oil
Palm Oil
Palm Kernel Oil
Coconut Oil
Rapeseed Oil
Sunflower Oil
Groundnut Oil
Source: Drewry
Table 5.14 EU-25: supply and demand of 17 oils and fats 2002-2007 (MnT)
October/September
02/03e 03/04e 04/05e 05/06e 06/07f
Production 17.25 17.64 18.43 18.56 19.54

Soya oil 3.07 2.59 2.64 2.56 2.7
Sun oil 2.23 2.55 2.29 2.22 2.38
Rape oil 4.25 4.46 5.58 6.17 6.49
Olive oil 2.06 2.42 2.35 1.99 2.29
Imports 6.48 6.7 7.84 9.34 10.03
Soya oil 0.05 0.07 0.19 0.78 1.03
Sun oil 0.66 0.54 0.8 1.27 1.2
Rape oil 0.03 0.03 0.03 0.52 0.64
Palm oil 3.57 3.84 4.48 4.58 4.95
Palm Kernel oil 0.59 0.66 0.65 0.61 0.72
Coconut oil 0.82 0.73 0.82 0.77 0.68
Exports (a) 2.01 1.94 1.92 1.45 1.51
Soya oil 0.69 0.54 0.52 0.27 0.27
Rape oil 0.17 0.14 0.14 0.06 0.06
Olive oil 0.35 0.35 0.38 0.35 0.39
Change in stocks -0.29 0.11 0.29 -0.7 0.15
Consumption 22.01 22.29 24.06 26.52 27.91
Soya oil 2.45 2.14 2.3 2.98 3.46
Sun oil 2.7 2.86 2.87 3.25 3.44
Rape oil 4.15 4.39 5.38 6.64 7
Olive oil 1.98 2.04 2 1.95 2.03
Palm oil 3.53 3.76 4.3 4.49 4.78
Tallow 1.15 1.11 1.14 1.15 1.12
a) Intra-EU trade excluded f) forecast e)estimated
Source: Oil World

3Q2007
Figure 5.15 SBO imports to EU-27 2002-2007 (MnT)
1.2
Totals
1.0
0.8
0.6
0.4
0.2
0.0
02/03e 03/04e 04/05e 05/06e 06/07f
Source: Drewry
The significant increases in EU-27 imports over the past 5.3.2 China
five years can be seen in the above charts and more
particularly the spectacular growth in soft oil imports The Chinese market for oils and fats is one of
leading to new business for owners. Also, the new outstanding growth, which can only be met by domestic
areas such as South America and Canada, which have production. This inevitably means further increases in
changed trade routes in giving owners more options, as imports of oils and fats, which are forecast to reach a
well as smaller ship business with sun oil from the Black record 8.8m tonnes this year.
sea area. However, it is worth noting here that the
recent problems in production here have led to drastic The country’s import demand is thus likely to rise by
reductions in imports. 1.5-1.6m tonnes within only two years.
Figure 5.16 China: imports of palm and soya oil (MnT)
8 Palm oil Soya oil
0
1998/99 1999/00 2000/01 2001/02 2002/03 2003/04 2004/05 2005/06 2006/07
Source: Drewry

3Q2007
Figure 5.17 Chinese changes of imports of major oils Jan-Jul 06-07 (‘000 T)
Jan-Jul 2006 Jan-Jul 2007

3,500
3,000
2,500
2,000
1,500
1,000
500
0
Palm Oil Soya Oil PKO Coconut Rapeseed
Source: Drewry
In comparison according to Oil World Chinese domestic Looking at the above chart’s difference between China’s
production of oils and fats is estimated at 20.2m tonnes, imports of 5 major oils over the first six months of this
up 1.7m tonnes from two years earlier, covering only year and compared to last year, (according to Oil
little more than half demand growth. World), we have seen an increase of last year close to
24.0%, with spectacular increases in soya, PKO and
However oilseed imports account for a rising share of rapeseed oils.
Chinese crushings. Oil World estimate oilseed imports
at a new record of 31.6m tonnes this year. By The growth in Chinese production of oils & fats will
comparison only 11.2m tonnes were imported last year. probably shrink further from 0.4m tonnes in 2006/07 to
Small wonder the dry bulk freight market has been around 0.3m tonnes in 2007/08. This forecast is made
strong over the past few years. on the assumption of sharply higher oilseed imports,
which can, however, offset the much lower domestic
Chinese importers strongly focus on palm oil and soya oilseed production only partly.
oil as these two oils are available in sufficient quantities.
Oil World estimates imports of palm oil at around The prospective production growth is sharply below the
5,660,000 tonnes and soya bean oil at around 1,700,000 anticipated increase of consumption by approximately
tonnes together covering around 86.0% of total Chinese 1.5-1.6m tonnes in 2007/08. This assumes a slight
imports of oils and fats. These estimates imply an slowdown of the average growth of per capita
increase of palm oil by 9.0% this year, and by 12.0% for consumption from 1.2 kilos in 2006/07 to 1.0 kilos next
soya oil. season.
So far we have not seen clear signs that the prevailing

high prices have dampened vegetable oil demand in
Jan-July Jan-July
Oil % Change China sharply.
2006 2007
Palm Oil 2,761 2,973 7.68% The widening gap between production and consumption
Soya Oil 854 1,334 56.21% is seen to boost imports of oils & fats to a record of
PKO 116 230 98.28% 10.1m tonnes in Oct/Sept 2007/08 forecast. This
Coconut 127 74 -41.73% implies an increase by nearly 1m tonnes, following a
Rapeseed 4 166 4050.00% sharp expansion by 1.5m tonnes in 2006/07. Oil World
expects an increase in palm oil imports by roughly 0.6m
Total 3,862 4,777 23.69%
tonnes and in soya oil imports by 0.3m tonnes.

3Q2007
5.3.3 Indian Ocean 5.3.4 USA
Soya oil imports are likely to turn out higher than The ongoing expansion of domestic biodiesel production
expected in Aug/Sept 2007. Argentina and Brazil continues to be the driving force behind the sizable
boosted soya oil exports in June and July sharply above growth of vegetable oil consumption in the US. Oil
the respective year-earlier levels. Considering shipping World estimates total consumption of 17 oils & fats at
time, Indian imports should be notably above the 124 16.5m tonnes in Oct/Sept 2006/07, up 0.5m tonnes or
thousand tonnes registered in August 2006, and sharply 3% on the year.
above the 75 thousand tonnes in September 2006.
The growth in soya oil consumption by 0.4m tonnes is
Combined imports of the six major vegetable oils almost exclusively on account of higher biodiesel
reached 512 thousand tonnes in August, up 17% on the production. According to official data, soya oil used for
year and virtually the same growth rate as in July. biodiesel production was boosted by 79.0% on the year
Cumulative arrivals in Oct/August 2006/07 were at 5.0m to 741 thousand tonnes in Jan/July 2007. In July, the
tonnes, up by 0.7m tonnes or 15.0% from the year demand was more than doubled to 157 thousand
before. Palm oil imports of 321 thousand tonnes in tonnes, the highest monthly volume registered so far.
August comprised 276 thousand tonnes of crude palm
oil, 14 thousand tonnes of RBD palm olein, and 31 Rising volumes of US biodiesel have been shipped to
thousand tonnes of inedible palm oil fractions, according Europe so far this year as B 99. The loophole of the
to data supplied by the Solvent Extractors Association. biodiesel tax credit created a strong incentive for US
Table 5.15 India: Imports of 6 major oils (‘000 T)
August July Oct/Aug

2007 2006 2007 2006 06/07 05/06
Soya Oil 161 124 237 290 1,277 1,609
Sun Oil 18 3 24 0 205 94
Rape Oil 0 0 0 0 0 0
Palm Oil 321 283 305 199 3,369 2,491
PKO 12 25 6 1 125 121
Coconut Oil 0 2 9 6 12 28
Total 512 437 581 496 4,988 4,343
Source:-Oil World
Table 5.16 USA: supply and demand of soya oil (‘000 T)
Oct/Sept Jan/July
07/08f 06/07 05/06 04/05 2007 2006
Open stocks 1,280 1,365 771 466 1,402 994
Production 9,504 9,294 9,247 8,781 5,362 5,326

Imports 16 17 16 11 11 10
Exports 321 850 523 620 423 290
Dom consumption 9,050 8,546 8,145 7,690 4,591 4,625
for bio diesel 1,750 1,270 700 200 741 414
for other use 7,300 7,275 7,445 7,684 4,150 4,211
End stocks 1,050 1,260 1,365 771 1,461 1,415
Source: Oil World

3Q2007
exporters to ship either biodiesel produced in the US or year 2008, bringing it to 41.7m tonnes, accounting for
from elsewhere with a marginal diesel blend. However, 26.0% of world production of the 17 oils & fats.
the EU may soon take measures to protect its biodiesel
market from such subsidized competition. In Malaysia, Oil World expects a pronounced recovery
by 1.3m tonnes in 2008, and in Indonesia, an increase
The strength of domestic demand and large exports led by 1.0m tonnes is shaping up according to our
to a reduction of US soya oil stocks to an estimated assessment. The mature oil palm area is forecast to
1.38m tonnes by end-August, down 9.0% from the peak increase by 0.7m hectares worldwide in 2008, which
of 1.52m tonnes at the end of June. contrasts with partly significant reductions in oilseed
acreage in other countries. Furthermore, a significant
Oil World assumes that US soya oil stocks will be recovery of average oil palm yields is anticipated next
reduced to around 1.0m tonnes in the course of year, primarily in Malaysia and to some extent also in
2007/08, despite an assumed uptrend in domestic Indonesia.
production. We estimate total US soya oil consumption
at 9.1m tonnes in 2007/08, up 0.5m tonnes or 6.0% on World palm oil imports have been boosted by 1.8m
the year. Usage for biodiesel production may reach tonnes, or 7.0% in 2006/07. Owing to the below-
1.7m tonnes in the upcoming season, thereby again average production growth, this has led to a major
accounting for the bulk of the expected demand growth. reduction of stocks in the key producing countries.
The US market’s dependence on soya oil will be strong The recent demand development reflected the impact of
in 2007/08, given relatively tight supplies of cotton oil, tightening supplies and high prices. The quarterly growth
sun oil and groundnut oil. This will contribute to a likely of world demand dwindled from 0.8m tonnes in Oct/Dec
further uptrend in palm oil imports to an estimated 760 2006, and 1.0m tonnes in Jan/March 2007, to 0.4m
thousand tonnes, against 660 thousand tonnes and 604 tonnes in April/June, and just 0.2m tonnes in July/Sept
thousand tonnes in the preceding two seasons, 2007.
respectively.
Altogether, world palm oil usage increased by 2.4m
5.4 Product markets tonnes in 2006/07. Oil World anticipates an even higher
demand increase of 3.0m tonnes. Palm oil supplies will
5.4.1 Palm oil be more ample than those of seed oils, and this will
keep palm oil prices competitive. However, the effect of
The contribution of palm oil to the world market will be of the prospective production boost is partly outweighed by
utmost importance in 2007/08 in view of relatively tight the decline in world palm oil stocks by estimated 0.6m
supplies of seed oils. Prospects are indeed favourable tonnes in the coming year as of early October 2007.
that palm oil can at least partly fill the gap created by
insufficient production growth in seed oils. 5.4.2 Lauric oils
Our current estimates point to an unprecedented boost in Lauric oil consumers strongly depended on palm kernel
world palm oil production by 3.7-3.8m tonnes in calendar oil in 2006/07 owing to a severe shortage of coconut oil.
Table 5.17 17 Palm oil – world supply and demand (MnT)
October/September
03/04 04/05 05/06 06/07 n
Opening Stocks 3.79 4.34 5.13 5.7 5.13
Production 29.95 33.51 36.05 37.38 41
Imports 23.42 26.18 27.9 29.72 32.35
Exports 23.47 26.15 28.06 29.92 32.25
Consumption 29.35 32.75 35.32 37.75 40.75
Ending stocks 4.34 5.13 5.7 5.13 5.48
Stocks/Use Ratio 14.80% 15.70% 16.20% 13.00% 13.40%
Source: Oil World

3Q2007
Table 5.18 Coconut oil: oil world balance (MnT)
October/September
07/08f 06/07 05/06 04/05 03/04
Open stocks 0.3 0.38 0.4 0.37 0.42

Production 3.09 2.87 3.22 3.15 3.1
Imports 1.93 1.76 2.2 2.08 1.83
EU-27 0.72 0.68 0.77 0.82 0.73
USA 0.45 0.43 0.51 0.42 0.37
China P.R. 0.25 0.2 0.17 0.13 0.11
Exports 1.94 1.74 2.17 2.1 1.86
Philippines 0.94 0.82 1.2 1 1.05
Indonesia 0.63 0.59 0.6 0.76 0.45
Consumption 3.05 2.98 3.26 3.1 3.13
End stocks 0.32 0.3 0.38 0.4 0.37
Source: Oil World
Strong world demand reduced palmkernel oil stocks recovered somewhat from the severe effects of last
sharply and boosted prices of the two oils to record year’s typhoon damage felt in the first quarter of 2007.
levels in mid-2007. In 2007/08, Oil World anticipates a
recovery in coconut oil supplies by 3-4% and a further Still, the damage done to Philippine coconut palms is
sharp increase in palm kernel oil supplies by more affecting production. Wide price premiums of coconut
than 5.0%, which is likely to bring prices under pressure oil over palm oil caused some demand rationing so far
in coming months. Coconut oil prices in Rotterdam this year, primarily in the producing countries. But the
rallied by $55 to $965/t for Oct/Nov shipment on Sept price premium diminished to $107/t on Sept 25,
25. The price strength was partly due to unusually low equalling the long-term average.
stocks, which were reduced from 42 thousand tonnes
held at Rotterdam bonded warehouses in early March to World consumption of coconut oil has declined by an
only 3 thousand tonnes in early September. The estimated 9% on the year in Oct/Sept 2006/07, but the
production shortfall in the Philippines led to a shortage actual decline may turn out larger as we are probably
on the world market and a price peak of above $1000/t still overestimating the recovery of Indonesian exports in
in early June. the second half of the season. Indonesian coconut oil
exports plunged by 39% on the year in the first half of
Production and export supplies in the Philippines have the season, pointing to further downtrend of production.
Table 5.19 Palm kernel oil world balance (MnT)
October/September
07/08f 06/07 05/06 04/05 03/04
Open stocks 0.45 0.6 0.48 0.33 0.42

Production 4.73 4.32 4.21 3.05 3.47
Imports 2.78 2.61 2.18 2.08 11
EU-27 0.76 0.73 0.61 0.65 0.65
USA 0.35 0.32 0.24 0.23 0.15
China P.R. 0.45 0.41 0.25 0.23 0.15
Exports 2.76 2.59 2.22 2.08 1.81
Indonesia 1.43 1.3 1.18 1.03 0.82
Malaysia 1.09 1.05 0.85 0.85 0.79
Consumption 4.69 4.49 4.05 3.86 3.58
Stocks/usage 11% 10.00% 14.90% 12.60% 10.90%
Source: Oil World

3Q2007
The decline in coconut oil consumption triggered a Combined G-3 soya oil exports approached a record
sharp increase in demand for palm kernel oil, which 2.0m tonnes in June and July, up 35.0% from a year
consequently followed the price uptrend in coconut oil earlier. This brought cumulative exports in Oct/July
almost in tandem. 2006/07 to 7.7m tonnes, up 9.0%.
For 2007/08 Oil World forecast a recovery in world The prospective decline in world soybean supplies by
coconut oil production by 7-8%, but it is still likely to trail 1.1% in 2007/08 compares with the growth of 8.1% this
behind the normal levels by only 120 thousand tonnes season and the decline of 2.1% in the last tight season
from the low in 2006/07, since growing demand from the 2003/04. With demand for soya oil and thus for
domestic biodiesel industry must also be satisfied. soybeans much stronger owing to the much larger
biofuel use of vegetable oils than in 03/04, Oil World
The growth in world production of palm kernel oil slowed expects the world soybean stocks to fall steeply by
down pronouncedly from 6.6% in 2005/06 to 2.7% in 23.0%, the largest downturn since 94/95.
2006/07.
5.4.4 Sunflower oil
World consumption was boosted by 11% in 2006/07
owing to the massive shortage of coconut oil. This The sun oil market currently suffers from a severe
demand boost could be covered only by a sharp supply tightness, which has recently been aggravated by
reduction of stocks to an estimated 450 thousand tonnes reserved selling, forcing consumers to adopt a hand-to-
at the end of September, a three-year low and down mouth buying policy. Late September sun oil prices in
from more than 600 thousand tonnes a year earlier. In Europe soared to around $1300-1350/t and export
Malaysia palm kernel oil stocks were reduced to only prices in Argentina and Ukraine partly reached or
191 Thousand tonnes as of early September 2007, vis- exceeded $1220/t when offers were available.
à-vis 363 thousand tonnes a year ago. The increase in
production growth expected in 2007/08 will thus be Sun oil production prospects have deteriorated
partly offset by the much lower carry-in stocks. somewhat recently. In Argentina, farmers have
difficulties in sowing sunflowers due to drought, which is
In 2006/07 palm kernel oil consumption was boosted by curbing the country’s production potential in 2008.
19.0% in the EU-27, by 31.0% in the US and by even
64.0% in China. In Malaysia consumption rose by only Oil World still anticipate a notable increase in
1.0% while exports surged by 23.0%. Argentinean production of sun seed and oil in 2007/08,
but this can only partly offset sharply declining
In 2007/08 we expect only a minor increase in production in the EU-27, Russia, Ukraine, South Africa
Malaysian exports to 1.09m tonnes, but a further sharp and Turkey. Also in China the sunseed crop has
increase in shipments from Indonesia to 1.43m tonnes. reportedly suffered drought damage.
The growth in world consumption should normalize and
slow down to 4-5%, reaching 4.7m tonnes next season. Oil World revised estimate of sun oil production in
2007/08 of 9.6m tonnes represents a three-year low.
5.4.3 Soya oil and is down by as much as 1.6m tonnes, or 14.0% from
a year ago.
World import demand for soya oil accelerated in June
and July, partly linked to a switch from high-priced sun Sun oil exports from Ukraine are forecast to drop by
oil and palm oil. Sharp increases occurred, above all, in 0.6m tonnes in 2007/08, and those from Russia by 0.3m
China and India in an effort to replenish insufficient tonnes. Argentinean shipments may rise by 0.3m
domestic supplies. tonnes and offset the decline in exports from the Black
Sea region at least partly.
In the table we summarize the latest soya oil exports
from Argentina, Brazil and the USA. They are the key Due to the tight supplies, demand rationing is
exporting countries and provide an excellent indicator of necessary. Oil World expects sun oil consumption in the
world import demand. In June and July we also saw EU-27 to drop by 0.4-0.5m tonnes next season, which
much larger shipments to Bangladesh, Venezuela, must be replaced mainly with rape oil, thus contributing
several other South American countries, North and South to the recent uptrend in rape oil prices. Also in a
Africa, as well as South Korea. Iran is an exception with number of importing countries in North Africa and Asia,
a sharp decline in imports of soya oil in Jan/Aug 2007, sun oil consumption is likely to shrink in response to the
while imports of sun oil increased sharply. current high price premiums.

3Q2007
Table 5.20 Soya oil: world supply and demand (‘000 T)
June/July Oct/July
From 2007 2006 06/07 05/06 04/05
USA 136 78 666 443 537
Argentina 1,360 922 5,063 4,628 3,918

Brazil 496 476 2,002 2,011 2,003
Total 1,992 1,476 7,731 7,082 6,458
of which to:
EU-27 157 1,270 700 200 741
Algeria 69 44 178 229 194
Egypt 34 35 94 221 152
Morocco 55 62 247 334 209
S.Africa 63 24 206 193 201
Other Africa 43 62 248 279 233
Africa 264 227 973 1,256 989
Mexico 30 16 134 100 146
Chile 36 37 167 145 129
Peru 60 24 214 189 167
Venezuela 60 10 114 77 55
Oth America 132 105 563 592 489
America 318 192 1,192 1,103 986
Bangladesh 134 8 386 202 195
China 570 277 2,097 1,319 1,577
H.Kong 4 3 40 22 24
India 348 270 1,088 1,396 1,514
Iran 62 188 526 521 609
S.Korea 69 29 278 228 161
Other Asia 60 74 248 333 208
Asia 1,247 849 4,663 4,021 4,288
Source: Oil World
Table 5.21 Sun oil: summary of world balance (MnT)
Oct/Sept
03/04 04/05 05/06 06/07 07/08f
Open stocks 0.83 0.79 0.83 1.04 0.91

Production 9.55 9.4 10.96 11.22 9.62
Imports 2.79 2.85 4.29 4.25 3.42
Exports 2.79 2.79 4.36 4.24 3.35
Disappearance 9.6 9.41 10.69 11.37 9.88
End stocks 8.3 0.83 1.04 0.92 0.69
stocks(usage) 8.30% 8.80% 9.80% 8.00% 7.00%
Source: Oil World

3Q2007
5.4.5 Rapeseed oil oil exports to a 6-year high of 216 thousand tonnes as of
end-July 2007, against 80 thousand tonnes a year
Rapeseed oil was priced $1037/t in Rotterdam on Sept earlier.
20, up 32.0% from the average of $784/t registered in
September 2006. The price increase in rape oil during As of end of September, in Peru, the Veda is unlikely to
the last twelve months was clearly less pronounced than be lifted before early November. Peruvian fob export
in sun oil, soya oil and palm oil, reflecting a prospective prices reportedly reached $850 end of September, and
sharp increase in global rape oil output. fish oil stocks are virtually depleted due to the record
exports of about 136 thousand tonnes in this third
Oil World estimates world production at 19.4m tonnes in quarter, up steeply from 66 thousand tonnes in the same
Oct/Sept 2007/08, up by 1.1m tonnes on the year and period of last year. Exports in October are likely to be
compared to a meagre increase of only 0.1m tonnes in close to zero compared with 12 thousand tonnes last
2006/07. Still, rape oil prices rallied recently, though at year.
a distance to competing oils, owing to strong demand
growth. In the EU-27, we anticipate a boost in rape oil 5.4.7 Tallow and other fats
consumption for food and non-food (mainly biodiesel) by
0.6-0.7m tonnes. Biodiesel production continues to Tallow prices rallied in the USA, Europe and on the
expand in the EU and the bulk of it remains dependent world market during the past six months, and are
on rape oil as key feedstock. The EU is thus seen currently almost double the year-ago level.
accounting for two thirds of the anticipated growth in
rape oil usage in 2007/08. An important factor for the price strength is to be seen in
the new demand for tallow for bio diesel production in
Canadian canola oil exports are seen expanding in the the USA and Europe. It is still unclear how much tallow
third consecutive year and may approach 1.4m tonnes was actually used for biofuels in Jan/June, but some
next season. Rising demand is expected primarily from traditional tallow consumers are complaining about
China, for which we peg imports at around 300 thousand increasing competition from biodiesel producers, which
tonnes. has led to sharply higher prices and made it difficult for
consumers to find sellers.
Rape oil stocks in Rotterdam have dwindled to a 3-year
low, only 9 thousand tonnes as of mid-Sept, illustrating Prices of US edible tallow (fob Gulf) have approached
the strong demand and necessitating replenishment, $800/t in July 2007, up steeply from $570 in January
also by imports from third countries. 2007, and up by 84.0% from a year earlier. Edible
tallow fob US Gulf was offered during 3Q07 at a
5.4.6 Fish oil premium of around $20 over RBD palm stearine, fob
Malaysia.
Fish oil exports were surprisingly large at about 99
thousand tonnes in June owing to strong import demand Tallow exports picked up so far this season in line with
from Europe and Chile. This brought total Peruvian fish increasing import requirements of China, South Korea,
Table 5.22 Rapeseed oil: summary of world balance (MnT)
Oct/Sept
03/04 04/05 05/06 06/07 07/08f
Open stocks 0.76 0.96 1.16 1.33 1.13

Production 14.51 15.96 18.15 18.3 19.4
Imports 1.43 1.35 1.91 2.15 2.24
Exports 1.4 1.39 1.95 2.13 2.21
Disappearance 14.34 15.73 17.94 18.52 19.51
End stocks 0.95 1.16 1.33 1.13 1.06
stocks (usage) 6.70% 7.40% 7.40% 6.10% 5.40%
Source: Oil World

3Q2007
Mexico, Venezuela and Nigeria. In April and May Oil World’s revised world supply & demand balance
shipments of 7 exporting countries increased by 11.0% confirms a pick-up in trade to a five-year high in the
from a year earlier to 362 thousand tonnes, bringing the 2006/07 season, an increase in global disappearance
total since October to a 5-year high of 1.28m tonnes. (exceeding production) and a further decline in stocks
Details with breakdown by major countries are given in to a multiyear low of an estimated 480 thousand
the table. tonnes at the end of this season. This is just 5.5% of
annual usage and explains the recent rally in tallow
US exports increased sizably by 15.0% to a combined prices.
205 thousand tonnes in April and May 2007. This
brought the accumulation to 705 thousand tonnes in There was an old sale of 10,000 tonnes of tallow from
Oct/May (up 11%), and contributed to a decline in US East Coast Canada (Hamilton and Montreal-Quebec)
stocks of tallow and greases down 21.0% from a year to Nigeria, which finally loaded in July and paid in the
earlier, the lowest in two years. low $90's/t level.
Table 5.23 Tallow and Grease: exports of key countries (‘000 T)
April/May Oct/May
From 2007 2006 06/07 05/06 04/05
Canada 45 49 149 163 126
USA 205 179 705 636 632
Argentina 3 3 29 22 31
Brazil 0 1 8 15 29
Uruguay 12 14 53 46 42
Australia 72 57 242 226 233
New Zealand 24 22 97 105 92
Total 361 325 1,283 1,213 1,185
Exports to
EU-27 3 3 13 6 43
Nigeria 33 28 109 90 45
Senega;l 3 8 8 28 0
S.Africa 5 1 14 9 13
Domin Rep 4 10 29 30 28
Guatemala 12 3 29 32 25
Mexico 64 74 269 264 275
Peru 5 1 18 15 17
Venezuela 17 19 64 54 45
China 55 52 221 199 208
Japan 13 11 56 51 49
S.Korea 35 20 97 65 56
Pakistan 16 9 49 48 39
Taiwan 16 6 42 40 54
Turkey 35 30 89 95 90
Others 46 51 176 185 198
Total 362 326 1,283 1,211 1,185
Source: Drewry

3Q2007
5.5 Others usage. Biodiesel production in August amounted to

37 thousand tonnes, while the total for Jan/Aug 2007
Stocks of rape oil were extremely low at 7.5 thousand reached only 185 thousand tonnes according to Oil
tonnes as of October 1st, down steeply from the normal World. This was considerably less than expected.
level and down substantially from 164 thousand tonnes
a year earlier. Also the inventories of other vegetable Total production in calendar year 2007 will probably
oils were unusually small with palm oil at a multi-year reach only around 340 thousand tonnes, compared with
low of only 27.2 thousand tonnes, compared with 85.2 a total installed biodiesel production capacity of an
thousand tonnes three months earlier and 42.5 estimated 2.1m tonnes at the end of this year.
thousand tonnes a year earlier. Stocks of sun oil
amounted to 27.7 thousand tonnes (against 74.4 and President Lula has reportedly agreed to the proposal of
41.8), soya oil 31.6 thousand tonnes (vs. 71.7 and 64.1), Brazilian biodiesel producers to gradually raise
palm kernel oil 23.3 thousand tonnes (vs. 16.0 and mandatory admixture of biodiesel to 3.0% in Jan/June
25.6), and of coconut oil 23.3 thousand tonnes (vs. 9.5 2008, to 4.0% in July/Dec 2008 and to 5.0% in calendar
and 25.3 thousand tonnes). year 2009. This compares with the former decision of
the government to enforce a mandatory mixing of 2.0%
5.5.1 Urea Ammonium Nitrate to the diesel fuel from Jan 2008 onward, and of 5.0%
only from 2010 onward.
This market is now covered in the Chemical report
It is expected that the Brazilian Government will soon
5.5.2 Biodiesel news make the necessary legislative amendment and
announce higher admixture quotas. This would boost
Brazil total Brazilian biodiesel demand to approximately 1.4m
tonnes in calendar year 2008, up steeply from 0.3m
Biodiesel producers have negotiated with the tonnes, estimated for Jan/Dec 2007.
government to raise admixture targets beyond the 2%
previously fixed from January 2008 onward. The If the proposal is really translated into new legislation
Brazilian bio diesel industry is suffering from excess and if admixture levels actually come up to these higher
capacity and negative margins. rates in Jan/June and July/Dec 2008, it will have a
bullish impact on soya oil. It would correspondingly
At the beginning of Oct 2007 the domestic biodiesel raise domestic demand for soya oil and result in a larger
price was 30.0% above the selling price of fossil diesel than expected decline in Brazilian soya oil exports in
fuel. This has resulted in a sharp decline in biodiesel Oct/Sept 2007/08.
Table 5.24 Rotterdam: stocks of 14 oils and fats-stocks at end of month (‘000 T)
2007 2006 2005 2004 2003 2002
Jan 406 350 233 273 420 363

Feb 314 315 229 216 413 369
Mar 392 337 239 190 358 332
Apr 347 374 297 278 326 349
May 349 406 365 276 278 353
Jun 321 407 268 203 273 363
Jul 325 400 253 183 280 344
Aug 200 305 306 120 239 315
Sep 147 372 255 185 250 285
Oct 375 264 150 221 240
Nov 384 284 147 233 290
Dec 301 244 170 292 305
Source: Drewry

3Q2007
Argentina 5.5.3 Molasses
Bio diesel production is now expanding with new Molasses activity remains strong this year and exports
capacities coming on stream. Most of the biodiesel are expected to exceed last year’s figures. For the sake
production is destined for the export market. of reference last year’s estimated export figures were:
EU -1,130,000 tonnes, Africa- 750,000 tonnes, Americas
The expansion of the Argentine biodiesel production – 1,400,000 tonnes, India/Asia – 2,400,000 tonnes. The
capacity to at least 0.7m tonnes by the end of this year Indian market has gone from 5,000 tonnes in 2004 to
(up 140 thousand tonnes from a year earlier) has been 62,000 tonnes in 2005, and it is expected to export
driven by the export tax advantage of biodiesel (5.0%) 1,000,000 tonnes this year!
compared to the 24.0% tax levied on soya oil.
The Latin America molasses market stirred a bit during
Argentine exports of biodiesel reached an estimated August. The falling freight levels created some
26 thousand tonnes in September, bringing the total for opportunities for the regular Caribbean molasses
Jan/Sept 2007 to about 73 thousand tonnes compared traders.
with nil last year. Approximately 58 thousand tonnes
were shipped to the European Union so far this year, The “Fantasy 1” was fixed for a full cargo from the
and 15 thousand tonnes to the USA. Oil World assumes WCCA to Baltimore and Albany for rates in the low
that most or the biodiesel shipped to the USA was re- $30’s/t basis 1/2. Other traders were busy moving
exported from the US Gulf, good for shipping. product from West Palm Beach and the ECCA to
Europe for rates reported to be in the very low $30’s/t
Indonesia basis 20,000 tonnes, and high $40’s/t basis 9000
tonnes, respectively.
Domestic production of biodiesel is now increasing with
new processing capacity coming onstream in the Tate and Lyle also covered their 12,000 tonnes
second half of this year. roduction is estimated at Henecan stem aboard Clipper’s “WoHanHan 2 to
almost 300 thousand tonnes in calendar year 2007. Baltimore for rates reported to be in the very high
Exports of bio diesel have picked up lately and are $30’s/t.
expected to reach 50-60 thousand tonnes per month in
Oct/Dec 2007. 5.6 Major shipping Issues
USA It is becoming apparent that very large vessels are

beginning to infiltrate into the oils and fats trade, mainly
Usage of soya oil for biodiesel production reached a by the major shippers such as Cargill and Wilmar
record 172 thousand tonnes in August (up 81.0% from introducing vessels over 70,000 dwt and one over
a year earlier), and 1.14m tonnes in Oct/Aug 2006/07 80,000 dwt. We assume these vessels are IMO class 3,
(up 85.0%). The boost in production was driven by with double bottoms. We are following this closely and
higher exports. will feature an analysis on this in the 4Q07 Forecaster.
Molasses-Representative rates: third quarter 2007
Vessel Quantity Loading Discharge Freight US$ Account Lay-can

B. Wallaby 11,000 Bangkok Korea 27.00 1-2 T+L 10-20 Aug
G. Frontier 6,000 Bangkok Korea 29 SVG End Aug
Knos Regina 6,000 Bangkok Korea 29 SVG 15-30 Aug
Ibrahim G 9,000 WC India Spain 44 T+L 19-25 Aug
Al Farabi 22,000 WC India N.Spain 39 T+L Mid Sep
Addaraq 22,000 India Continent RNR SVG Mid Sep
Gem of Goa 9,000 Karachi Continent 42 T+L Aug

3Q2007
chemical forecaster profile
6. Profile – MISC Berhad MISC Berhad’s President/CEO is Dato’ Shamsul Azhar

Abbas who joined the company in July 2004. He is also
the Chairman of Petronas Maritime Services Sdn Bhd,
We first profiled the Malaysian International Shipping AET Tanker Holdings Sdn Bhd, Malaysia Marine and
Corporation in 1998 and updated it in 2001, and further Heavy Engineering Sdn Bhd, MISC Integrated Logistics
presented another version in the previous quarter. Sdn Bhd and a Director on the Boards of Bintulu Port
However, since then there have been more updates on Holdings Berhad, NCB Holdings Bhd and the London
the Company’s profile, which is why we have decided to Steamship Owners’ Mutual Insurance Association
present readers’ with a detailed version of the more Limited (London P & I) and Council Member of American
recent changes. Bureau of Shipping (ABS) and Bureau Veritas. MISC
Berhad’s Chairman is Tan Sri Dato Sri Mohd Hassan
Now more simply known as MISC Berhad and with a Marican who is also the President and CEO of Petronas.
new and brighter company logo it clearly aims to
develop its energy sector not only in LNG and petroleum Before we concentrate on their present and future
ships, but once again committing to chemical tanker chemical tanker fleet it should be emphasised that the
newbuildings and we expect to see more activity on the Company is today operating a modern and well
sale and purchase side in this business section. diversified relatively young fleet of over 100 vessels with
a combined tonnage of more than 8.0m tonnes, and is
Formed in 1968, as a joint-venture between the stated to be the world’s 4th largest shipping company by
Malaysian Government and a group of private market capitalisation. It is also the World’s second
entrepreneurs, MISC took delivery of its first chemical largest owner-operator of Aframax Tankers, and is
tankers in 1975 and in 1983 the very first LNG tanker currently the world’s largest single owner-operator of
“Tenaga Satu”, Malaysia’s first LNG cargo. LNG tankers.
Petronas assumed management control in 1997 by With the unveiling of MISC's new corporate look and
acquiring a 29-30% stake, and following the acquisition image on 22 September 2005, the company clearly
of shipping asset and companies from Konsortium stated its wish to building greater partnerships and
Perkapalan Berhad and merger with Petronas Tankers stronger ties and the fleet presently consists of 106
the Petronas share became 62.4%, and remains so to owned vessels across the following business sectors.
this day, as at 31st May 2007, foreign investors 8.7%
MISC maintained its global market position as the
and the public around 28.9%. largest single owner-operator of LNG carriers with the
As at Charter Average Age Owned by

Business Unit Vessel Type New Buildings
1/7/07 in Own 2011
LNG LNG 23 - 10 6 29
VLCC 9 1 3 2 11
Aframax 30 17 8.2 13 43
Petroleum LR2 1 0 20 - 1
Product 5 2 12.6 - 5
Shuttle - 2 0 - -
Chemical 13 3 10.3 16 29
Chemical LPG 3 - 13.3 - 3
Dry Bulk 1 - 8 - 1
Liner Containership 21 14 9.7 - 21
TOTAL 106 39 9.6 37 143
Offshore FPSO/FSO 6 - 2.3 1 7

3Q2007
delivery of three new LNG carriers namely “Seri has also pushed chemical freight rates and prices for
Amanah” in March 2006, “Seri Anggun” in November newbuilding higher. Capitalising on the market strength,
2006, and “Seri Angkasa” in January 2007, bringing its six contracts were renewed at higher charter hire rates
LNG fleet size to 23 carriers. MISC also strengthened at the end of 2006 and five new contracts were further
its third party LNG shipping business by securing a long secured.
term third party LNG shipping contract with Yemen LNG
for two new LNG carriers. The revised MARPOL Annex II Regulation, which came
into effect 1 January 2007, stipulates that all vegetable
Since its 2003 acquisition of the NOL owned American oils are to be carried on Type II double hull chemical
Eagle Tanker (AET) fleet, it has been leveraging on tankers. This will effectively restrict the trading
AET's strong brand and global coverage and MISC's opportunities of MISC's six existing single hull chemical
integrated petroleum fleet is in a better position to offer tankers.
global petroleum shipping services. In view of the high
asset price environment, AET grew its fleet size by The company’s recently contracted chemical tankers are
chartering in 17 Aframax class tankers and 1 VLCC. AET directly related to this business need to have a
also took delivery of 2 VLCC, increasing its VLCC fleet to replacement program in place as it phases out its single
9 tankers. It now operates a total fleet of 67 owned and hull tonnage.
chartered in tankers.
In a stated effort to maintain their position in the palm oil
In April 2004, MISC’s first Floating Production, Storage trade, MISC have already contracted eight new 38,000
and Offloading (FPSO) facility, FPSO “Bunga Kertas” dwt MarineLine coated chemical tankers in March 2006
was successfully delivered to PETRONAS Carigali. from STX Shipbuilding Co Ltd Korea. These tankers will
MISC now has 7 FPSOs/FSOs in their offshore portfolio, be delivered in 2009 and 2010 with the flexibility to enter
2 of which are in Brazil in partnership with SBM. the clean petroleum product trade and/or particularly
swing into and out of the chemical trade.
Meanwhile, fully owned Malaysia Marine and Heavy
Engineering Sdn Bhd (MMHE), strengthened by its The coating will make these ships very special and is
reorganisation and capability building initiatives, becoming ever more popular with owners as in effect a
returned to profitability as it continued its strategic shift substitute for stainless steel, such is the broad range of
towards oil and gas engineering and construction and cargoes to be carried, including acids, and the lack of
high value added marine repairs. absorption negates many cleaning problems, and the
possibilities of contamination.
The liner business has been adversely impacted by the
softening of freight rates especially towards the second Tests run so far by the Federation of Oils Seeds and
half of 2006. Weighed down further by higher operating Fats Association (FOSFA) have revealed nil absorption
expenses mainly due to escalation in bunker prices, the for EDC and Styrene Monomer, however further tests
liner business posted recent losses. have to be run on ships themselves before a final
decision is made to give the same relaxation on
MISC believe the shipping industry will be competitive in previous cargoes as stainless steel.
the coming year or two as substantial new capacity will
be delivered, adding pressure to the already softening Recent news
freight rate situation. In view of the challenging business
environment, the Group expects to be cognizant of On the 4th July this year, MISC signed a long term
market movements and proactively strategise to charter agreement for 2 x 19,900 dwt stainless steel
respond to its volatility. IMO II vessels to add to the three already secured.
So the energy sector will continue to be the thrust for There were also reports of confirmation of an order for 8
future expansion. MISC plans to continue to strengthen x 45,000 dwt IMO II new buildings from the SLS Yard in
its global LNG shipping leadership position with the South Korea with deliveries starting in 2009. MISC has
delivery of another 6 LNG carriers between 2007 and been able to get early delivery slots at SLS starting 2009
2009. AET will take delivery of 13 Aframaxes and 2 and moving into 2010, despite most Korean and Japan
VLCCs. yards being full till 2010. The double-hulled vessels
come just over a year after the eight IMO II 38,000 dwt
The impending new regulations for double hull chemical vessels it had ordered at STX Shipbuilding to replace
tankers for the carriage of vegetable/palm oil cargoes single-hulled vessels in its fleet.

3Q2007
“With the expanded chemical fleet, which are all double- The chemical tanker fleet
hulled and fully IMO compliant taking into account the
new regulations, MISC is well placed to service the In our 2001 profile, services had been modified since
growing Malaysian palm oil transportation needs. 1999, with 4 x 32,000 dwt and 4 x 30,000 dwt continuing
to operate to Europe and return, and three 32,000 dwt,
Going forward MISC said it planned to continue growing and two 16,600 dwt vessels were moved east of Suez,
is chemical tanker business. for a larger more regional SE Asia to Red Sea/AG/Indian
sub Continent and return service.
MISC see the outlook for the chemical shipping industry
as positive with the completion of petrochemical plants in The overall fleet of then 15 ships was relatively young
the Middle East which is projected to increase commodity with an average age of 6 years. The average
chemical trade by more than two fold between 2005 and deadweight size was 26,369 tonnes, with a limited
2008. Demand for more sophisticated chemical tankers 12.0% stainless capacity, but a handy pump ratio of
will increase due to the new regulations and complexity close to 1 per 1,000 cubic metres of space.
of products. Further, the increasing demand for biofuels
will stimulate more vegetable oil demand worldwide, There followed a “lull” on any expansion, as the
which is positive for chemical shipping. company reviewed its assets and priorities, until in 2004
it acquired some stainless vessels to replace vessels
In view of the expected downcycle in the shipping that were moving out.
industry, MISC have stated their intention to proactively
scan for mergers and acquisition opportunities to build Their two 8,600 dwt 1997 built, coated, IMO 2, double
critical mass and expand global coverage. More third hulled, 12 pumps/segregations vessels “Bunga Melawis
party LNG transportation contracts will be pursued Satu” and “Bunga Melawis Dua” were sold to Tradewind
leveraging on existing business partnerships. The Tankers, which may now be a regretful step, bearing in
petroleum shipping business will intensify its efforts to mind the paucity of this size of vessel in SE Asian
grow the petroleum product shipping segment and the waters for the carriage of Palm Oil since the new
lightering business in Asia, in addition to enhancing its regulations have come in to effect.
global leadership position in the Aframax tanker market.
The chemical shipping business will focus its effort on The two 1991 built IMO Class 16,924 dwt Bunga
capturing opportunities towards expanding its global Siantan and Bunga Semarak, with double bottoms have
footprints. The new chemical tankers, which will be been moved into the regional petroleum business.
delivered in 2009 and 2010, will provide MISC with the
capacity required to trade Malaysian palm oil to support The in charter of the three Fukuoka built stainless steel
the growing Malaysian palm oil trade. 19,700 dwt new buildings in 2005 was an astute move at
an attractive price (considering that of today) and they
MISC Berhad (MISC) announced its Group financial are fine ships for future flexibility. The Straits to Europe
results for the financial year ended 31st March 2007 oils and fats, oleo-chemicals and chemical service
which are self explanatory and as follows: continued with the seven double hull
MISC Full Year Financial Highlights Mar 03 Mar 04 Mar 05 Mar 06 Mar 07
MYR Million 5,433 7,606 10,651 10,747 11,199

Operating Revenue 1,310 2,326 4,739 2,926 2,930
Net Profit 1,310 2,290 4,764 2,870 2,896
Total Assets 14,726 22,358 25,428 27,621 27,955
Shareholders Funds 9,618 11,352 15,280 18,156 18,639
Cash 1,030 1,854 4,374 3,426 2,218
Debt 4,222 9,356 8,215 6,608 6,804
Return on Equity (%) 13.6 20.2 31.2 15.5 15.3
Return on Asset (%) 11.9 12.2 28.3 12.8 12.3
Dividend per Share (Sen) 15 20 30 30 30
Gross Debt-to-equity ratio (x) 0.44 0.82 0.54 0.36 0.37

3Q2007
Fleet list- MISC Berhad chemical business section
Ship Name DWT STST ML Epoxy Zinc Built IMO 2 IMO 3 Operator
Bunga Kantan Dua 19,766 21,600 - - - 2005 21,600 - Fairfield
Bunga Kantan Satu 19,774 21,600 - - - 2005 21,600 - Fairfield
Bunga Kantan Tiga 19,734 21,600 - - - 2005 21,600 - Fairfield
Bunga Melati Satu 32,127 5,703 - 29,488 - 1997 35,191 - MISC
Bunga Melati Dua 32,169 5,703 - 29,488 - 1997 35,191 - MISC
Bunga Melati 3 31,983 12,108 - 22,815 - 1999 34,923 - MISC
Bunga Melati 4 31,967 12,108 - 22,815 - 1999 34,923 - MISC
Bunga Melati 5 31,975 12,108 - 1,306 21,509 1999 34,923 - MISC
Kvarven 29,980 5,173 - 27,458 2,332 1991 17,225 17,738 SH Marine / Bryggen
Bunga Siantan 16,924 - - 19,338 - 1991 - - MISC Petroleum
Bunga Semerang 16,924 - - 19,338 - 1990 - - MISC Petroleum
Skarven 29,928 5,173 - 27,458 2,332 1990 17,225 17,738 SH Marine / Bryggen
Stoltzen 29,974 5,173 - 27,458 2,332 1990 17,225 17,738 Stolt-from Bryggen
Varden 29,995 5,173 - 27,458 2,332 1989 17,225 17,738 Stolt-from Bryggen
Bunga TBN 19,900 21,600 - - - 2010 21,600 - MISC
Bunga TBN
19,900 21,600 - - - 2010 21,600 - MISC
NB STX 2044 38,000 - 45,000 - - 2009 45,000 - MISC
NB STX 2045 38,000 - 45,000 - - 2009 45,000 - MISC
NB STX 2050 38,000 - 45,000 - - 2009 45,000 - MISC
NB STX 2046 38,000 - 45,000 - - 2009 45,000 - MISC
NB STX 2047 38,000 - 45,000 - - 2009 45,000 - MISC
NB STX 2048 38,000 - 45,000 - - 2010 45,000 - MISC
NB STX 2049 38,000 - 45,000 - - 2010 45,000 - MISC
NB STX 2052 38,000 - 45,000 - - 2010 45,000 - MISC
NB SLS 45,000 - 53,200 - - 2009 53,200 - MISC
NB SLS 45,000 - 53,200 - - 2009 53,200 - MISC
NB SLS 45,000 - 53,200 - - 2009 53,200 - MISC
NB SLS 45,000 - 53,200 - - 2010 53,200 - MISC
NB SLS 45,000 - 53,200 - - 2010 53,200 - MISC
NB SLS 45,000 - 53,200 - - 2010 53,200 - MISC
NB SLS 45,000 - 53,200 - - 2010 53,200 - MISC
NB SLS 45,000 - 53,200 - - 2010 53,200 - MISC
By 2010 ######## 200,638 785,600 257,032 73,855 7 1,207,497 70,952

3Q2007
32,000 dwt Melati class 35 tanks pumps and to Middle East route to consolidate a position for the
segregations, whilst the four 29,990 dwt 1990/91 built new buildings which have been ordered from STX in
IMO 2/3 “Angerrik” class with double bottoms, around Korea.
5,000 cbm stainless, 35 segregations phenolic epoxy
and zinc were time chartered out to Bryggen until 2011. The order for the new buildings has been long awaited
Soon thereafter, two of the vessels were re-let until 2008 by the trade, particularly the palm oil lobby. The
to SH Marine, and the other two to Stolt-Nielsen until 8 x 38,000 dwt, and the recently announced 2 x 19,900
2011. Both these entities had a niche for trading these dwt and 8 x 45,000 dwt ships will be ideal vessels for
double bottomed but very flexible ships, and we would the trade, not only for palm oil and its derivatives, but
not be surprised if they are sold eventually to either and also for the fast growing Middle East Gulf commodity
or others. chemical trade, and it will be interesting to see which
they will service as it is obviously difficult to service
Bryggen has renamed the ships “Kvarven” (Bunga both.
Tanjung), “Skarven” (Bunga Cenderawasih), “Stoltzen”
(Bunga Mawar) and “Varden” (Bunga Angerrik) and all Whilst MISC have no ships dedicated to the Middle East
the three 19,990 dwt Fukuoka stainless steel IMO 2, Gulf chemical trade, in 2001 MISC did sign an MOU that
2005 new buildings have been put away to Fairfield on did not yield anything substantive with Saudi Arabia’s
time charter at an undisclosed rate for an undisclosed Bakri Navigation.
period of time.
We anticipate updating this fine company’s profile a lot
This leaves the chemical fleets effectively operating only sooner next time around, as it shapes up to restoring its
7 ships in the market which continue to be quite heavily rightful place as one of the world’s major operator/owner
contracted on the Straits to European route and Straits of chemical tankers.

96
3Q2007
chemical forecaster listings
Listings
L1 Chemical carrier new orders 98
L2 Chemical carrier – secondhand sales 100
L3 Chemical carrier deliveries 103
L4 Chemical carrier demolition sales 105
L5 Chemical time charter fixtures 106
L6 Chemical carriers converted to DH 107

3Q2007
98
L1 Chemical carrier new orders in 3Q07
Date Yard Owner/Manager No DWT Price Built DC
Jul 07 21st. Century Primera Maritime 4 13,000 $ 25.3m 2010 A
Jul 07 Dearsan Unknown 1 10,300 0 2009 AA
Jul 07 Dubai DD Navig8 4 50,000 $ 43.75m 2009 E
Jul 07 Eregli Eregli Yard 2 25,000 0 2009 D
Jul 07 Gemak Marnavi 1 6,900 0 2008 A

Jul 07 Gisan Unknown 1 21,500 0 2009 A
Jul 07 Guangzhou Lauritzen 4 50,500 $ 47m 2010 E
Jul 07 Guangzhou Valles 2 50,500 $ 47m 2010 E
Jul 07 Hyundai MD Omega Navigation 5 37,000 $ 44.5m 2011 AA
Jul 07 Hyundai MD Tankinvest 5 52,000 $ 49m 2011 E
Jul 07 Icdas Icdas Celik Enerji 2 19,900 0 2009 A
Jul 07 Jiangnan Knutsen OAS 1 16,400 0 2010 AA
Jul 07 Jiangzhou Schulte Group 3 16,500 0 2009 E
Jul 07 Jiangzhou Sloman Neptun 4 16,500 0 2009 AA
Jul 07 Marmara Yilmar Shipping 2 7,000 0 2009 A
Jul 07 Niigata Japanese 1 11,500 0 2008 A
Jul 07 Nokbong Lotus Shipping 1 10,800 0 2008 D
Jul 07 Okskaya Oka Barbaro 3 6,600 $17m 2009 E
Jul 07 SLS MISC (Chemical Business Unit) 8 45,000 0 2010 A
Jul 07 SPP Byzantine 4 50,000 0 2011 E
Jul 07 STX Benelux Overseas 2 12,800 $ 23m 2009 E
Jul 07 STX Dong-A Tankers 4 12,750 0 2009 E
Jul 07 STX Munchmeyer Petersen 8 12,750 0 2009 E
Jul 07 Taixing Ganghua Shipbuilding Unifleet 8 4,250 0 2008 A
Jul 07 Zhejiang Jingang Laskaridis Shipping 4 16,500 $28m 2010 D
Aug 07 Aker Philadelphia OSG Group 1 46,815 0 2007 A

L1 Chemical carrier new orders in 3Q07 cont’d
Date Yard Owner/Manager No DWT Price Built DC
Aug 07 Aykin MRC Denizcilik 1 6,100 0 2008 D
Aug 07 Dongbang Sunwoo Merchant Marine 1 6,250 0 2007 A
Aug 07 Fukuoka Dorval 6 19,700 0 2010 A
Aug 07 Higaki Dorval 1 12,500 0 2007 A
Aug 07 Jiangzhou Iintrepid Shipping 3 16,500 0 2010 AA

Aug 07 Kurinoura Dorval 3 12,500 0 2008 A
Aug 07 Miura Zosensho Dorval 2 13,000 0 2010 A
Aug 07 Rushan City Erria 9 6,500 0 2011 A
Aug 07 Yangzhou Kejin Sumatec Resources 2 8,000 0 2008 E
Sep 07 Baima Capital S.M. 2 14,000 0 2007 A
Sep 07 Guangzhou Roxana 1 38,500 0 2007 E
Sep 07 Jiangzhou Algoma Tankers 3 16,500 0 2011 E
Sep 07 Samho Blystad 8 25,000 $42m 2010 A
Sep 07 Samho Capital S.M. 12 25,000 $42m 2010 A
Source: Drewry
3Q2007
99
3Q2007
100
L2 Chemical carrier - secondhand sales in 3Q07
Date Ship Name Last Ex Name Seller Buyer DWT Built DC Price Comments
Sep 07 Alexandra Park Bow Triumph Tanker Pacific Polyar 41,327 1992 B $32.25m
Sep 07 Alkyon Pisagua Unknown unknown 18,277 1981 B
Sold with 10 yr. TC to SH Marine, en
Aug 07 Atlantic Ambassador Langepas Palmali Shipping Norway 33,425 1998 H $90 m en bloc bloc Indian Ambassador & Pacific
Ambassador
Sep 07 Beffen Bryggen Stealth 19,700 2007 A $50m 3 yrs BBB, Changed Flag
Jul 07 Berna Sultan Yeliz K VGB Denizcilik Sanayi 6,375 1988 B $5.2m
Sep 07 Chem Glory Mercure SH Marine Ltd. Norway 29,751 1992 H $ 19m Not yet converted, changed IMO Class
Sep 07 Chem Oceania Kilchem Oceana Chartworld 6,748 1984 C

Chemship/Fingad Shipping/Fleet
Aug 07 Chemical Sprinter Acquamarina Soysay 6,058 1988 A $7m
Management
$19m en bloc
Aug 07 Diamontec Adani Shipping Norway 13,000 2007 D En bloc Rainbowtec
Rainbowtec
Sep 07 Elisa Motia 29,006 2005 E $26m.
Jul 07 Eships Prelude Navitas Prelude Emirates/Asuka Kisen Global Skibsholding 8,509 2003 A $40 en bloc BBB to 2014, en bloc Eships Quest
Jul 07 Eships Quest Navitas Quest Emirates/Asuka Kisen Global Skibsholding 8,501 2003 A $40 en bloc BBB to 2014, en bloc Eships Prelude
$105m en bloc Changed IMO Class, TC to 2016, en

Sep 07 FR8 Endeavour K-One Shipping Pte. Ltd. Stealth 50,546 2006 A
FR8 Spirit bloc FR8 Spirit
$105m en bloc Changed IMO Class, TC to 2016, en
Sep 07 FR8 Spirit Navig8 Stealth 50,100 2006 A
FR8 Endeavour bloc FR8 Endeavour
Sep 07 Giacinta Motia 19,960 1984 H Changed detail
Jul 07 High Trust Seafarers Shipping D'Amico 45,937 2004 H
Aug 07 High Wind D'Amico World Tankers 46,473 1999 E $35.5m 18 mo. TC
Sold with 10 yr. TC to SH Marine, en
Aug 07 Indian Ambassador Kogalym Palmali Shipping Norway 32,940 1996 E $90 m en bloc bloc Atlantic Ambassador & Pacific
Ambassador
$30.5m en bloc
Sep 07 Liquid Beauty Brovig Fjord Elmira Shipping & Trading unknown 12,956 2006 A en bloc 3 sisters
3 sisters
$30.5m en bloc
Sep 07 Liquid Blue Brovig Ocean Elmira Shipping & Trading unknown 12,934 2006 A en bloc 3 sisters
3 sisters
$30.5m en bloc
Sep 07 Liquid Elegence Brovig Sea Elmira Shipping & Trading unknown 12,901 2006 A en bloc 3 sisters
3 sisters
Sep 07 Longobarda Mediterranea di Navigazione Far East 10,006 1992 B $14.9m

L2 Chemical carrier - secondhand sales in 3Q07 cont’d
Aug 07 Merlion Park Bow Trigger Tanker Pacific Polyar 41,354 1993 B $32.9 m
Jul 07 MS Simon Chemikalien Seetrans 37,248 2004 E $44m
Jul 07 Multitank Iberia Martime Gesellschaft Europe 5,797 1995 A $14.5m
Sep 07 Narcea Sabedin Bey Ayder Tankers 4,750 2006 A $18m
Sep 07 Nord Sea Cido Shipping German KG 45,987 2003 H With TC back

Sep 07 Nord Sound Donnelly Tanker Management Konig 45,975 2003 E $52m
Sep 07 Nord Strait Fukujin Kisen Konig 45,934 2004 E $52m

Aug 07 Pacific Ambassador Urai Palmali Shipping Norway 28,840 1995 E $90 m en bloc
Aug 07 Petro Discoverer Stolt Kingfisher Dilmun 3,283 1986 B $2m
Sep 07 Phoenix V Sichem Navigator Simatech Dubai Fairdeal 6,715 1984 B $2.75m Changed Name
Jul 07 Rainbow Quest Unique Shipping Greece 47,221 1999 H $49m
Aug 07 Samho Phoenix Samho Shipping Co. Ltd. 3,436 2004 A
Sep 07 Satittara Sichem Martin Thai Oil Marine Nigeria 7,088 1984 F $2.5 m
Sep 07 Seadevil German Tanker Shipping Thai Oil 32,250 1996 H
Sep 07 Sichem Maya Songa Maya Eitzen 17,391 1988 F
Sep 07 St. Clemens Maruta Industries German KG 47,131 2000 E $38.5m Changed IMO Class
Sep 07 Sten Embla Lowell Shipholding 13,754 1999 A $24m 2 yr bbb $9,000 pd Changed Owner
Aug 07 Tina Jakobsen Multitank Antares Erria Balkans 3,345 1980 A $4.58m
Aug 07 Waseela 3 Dubai Shipping Europe 6,200 2007 H $12.8m
Sep 07 Winoto Udang Natuna Asean Promoter Blossom International Bangladesh 31,600 1975 H $460/ldt - 6959 ldt
Jul 07 Y Soli 3 Soli Denizcilik Elbana 19,990 2008 A $40m en bloc Soli 2 Newbuilding sold
Jul 07 Y Soli 2 Nakkas Elbana 19,990 2008 A $40m en bloc Soli 3 Newbuilding sold
Aug 07 Spectator Evalend Shipping Nordic Tankers 13,000 2007 A $30m Newbuilding sold
Jul 07 Highland Besiktas Denizcilik SMTV 7,800 2007 D $23m Newbuilding sold
Jul 07 Besiktas England Besiktas Denizcilik Uni-Tankers 18,000 2007 A $40m Newbuilding sold
Aug 07 Besiktas Nordland Besiktas Denizcilik Uni-Tankers 18,000 2007 A $40m Newbuilding sold
3Q2007
101
3Q2007
102
L2 Chemical carrier - secondhand sales in 3Q07 cont’d
Aug 07 Rainbowtec Adani Shipping Norway 13,000 2007 D $19m en bloc Diamontec Newbuilding sold
Jul 07 Acrux Enomare India 3,434 1970 A $590/ldt - 1415 ldt Sold for Scrap
Sep 07 Alamoa Global Transporte India 9,981 1978 A $920/Ldt Sold for Scrap
Aug 07 Polyxeni I. Polyxeni Aegean Shipping Bangladesh 29,974 1984 G $400/ldt - 6965 ldt Sold for Scrap
Jul 07 Pradera Stolt Pradera Enomare India 3,338 1976 B $590/ldt - 1340 ldt Sold for Scrap
Sep 07 Riza Rizal Delfi Bangladesh 39,155 1980 H $590/ldt - 7648 ldt Sold for Scrap
Source: Drewry

3Q2007
L3 Chemical carrier deliveries in 3Q07
Ship Name DWT Built Operator Owner/Manager Dld DC
Acor 37,000 2007 Norden Geden Line Jul-07 D

Alam Cergas 35,000 2007 Pacific Carriers Malaysian Bulk Carriers /PCL Aug-07 D
Alessandro DP 16,800 2007 Di Poli Ar.Co.In. S.R.L. Sep-07 A
Arabian Orchid 19,700 2007 Sabic Shinwa Kaiun KK Jul-07 A
Argent Aster 33,000 2007 Tokyo Marine Tokyo Marine Jul-07 A
Arwen 9,047 2007 Herning Shipping Hong Lam Marine Jul-07 AA
Asopos 12,000 2007 Barclay Shipping Capital S.M. Jul-07 E
Atlantic Blue 46,600 2007 Cido Shipping Cido Shipping Jul-07 H
Atlantic Breeze 46,600 2007 Cido Shipping Cido Shipping Sep-07 H
Atlantic Crown 46,600 2007 Maersk Pool Cido Shipping Sep-07 H
Ayfer Ka 3,400 2007 Trans Ka Trans Ka Sep-07 A
Azra S 5,850 2007 Sener Petrol Denizcilik Sener Petrol Denizcilik Sep-07 E
Bai Chi 42,000 2007 China Shipping (Tankers) China Shipping (Tankers) Aug-07 H
Beffen 19,700 2007 Bryggen TC Out Bryggen Aug-07 A
Bit Viking 25,000 2007 Preem Tarbit Shipping Sep-07 D
Bosporos 37,000 2007 Tsakos Tsakos Aug-07 E
Botany Troubador 12,000 2007 Botany Bay Botany Bay Sep-07 A
Bow Olivia 19,900 2007 Odfjell-Seachem Usuki Aug-07 A
Breeze 13,000 2007 Vitol Unibros Shipping Aug-07 A
Challenge Paradise 45,800 2007 Sanko Steamship Doun Kisen Sep-07 E
Challenge Pegasus 47,400 2007 NYK Nippon Yusen Kaisha Aug-07 H
Clipper Katja 11,259 2007 Clipper Wonsild Ocean Going Clipper Group Sep-07 A
Clipper Klara 11,259 2007 Clipper Wonsild Ocean Going Clipper Group Jul-07 A
Cypress Galaxy 25,400 2007 Tokyo Marine Tokyo Marine Aug-07 A
Diamontec 13,000 2007 Adani Shipping Adani Shipping Aug-07 D
DL Aster 13,000 2007 Daelim Daelim Sep-07 A
Dubai Star 50,561 2007 Dorado Tanker Pool Emirates Trading Jul-07 E
Earthsong 9,466 2007 Hong Lam Marine Hong Lam Marine Sep-07 A
Evie PG 9,960 2007 Pritchard Gordon Pritchard Gordon Sep-07 E
Fidias 51,000 2007 Ionia Management Ionia Management Jul-07 E
FR8 Freedom 47,000 2007 FR8 Navig8 Sep-07 D
Freja Fionia 53,000 2007 Mitsui OSK Lines Mitsui OSK Lines Jul-07 H
Gan-Ocean 17,000 2007 Dunya Denizcilik Dunya Denizcilik Aug-07 A
Giant Sambu 8,000 2007 Sambu Shipping Co. Ltd. Sambu Shipping Co. Ltd. Jul-07 A
Gulf Mews 37,000 2007 Gulf Energy Maritime Gulf Energy Maritime Jul-07 A
Gulf Moon 37,000 2007 Gulf Energy Maritime Gulf Energy Maritime Jul-07 A
Hegren 19,700 2007 IPPC Bryggen Jul-07 A
Histria Giada 40,400 2007 Histria Ship Management Histria Ship Management Aug-07 E
Iver Example 47,000 2007 Iver Ships BV Vroon Jul-07 D
Iver Express 46,000 2007 Iver Ships BV Vroon Jul-07 D
Karagol 3,418 2007 YDC Denizcilik YDC Denizcilik Aug-07 A
Kazdanga 37,340 2007 Latvian Shipping Latvian Shipping Aug-07 E
Krisjanis Valdemars 37,340 2007 Latvian Shipping Latvian Shipping Sep-07 E
Kronborg 40,000 2007 Weco Dannebrog Jul-07 D
Lacanau 11,000 2007 Petromarine SA Petromarine SA Aug-07 E
Lamentin 8,600 2007 Petromarine SA Petromarine SA Jul-07 D
Marin 4,200 2007 Herning Shipping Admibros Aug-07 D
Meg 38,500 2007 Handytankers Seaarland Aug-07 E
Mentor 13,000 2007 Marida Pool Evalend Shipping Aug-07 E
Meriom Rose 38,500 2007 Weco Overseas Maritime Jul-07 E

3Q2007
L3 Chemical carrier deliveries in 3Q07 cont’d
Ship Name DWT Built Operator Owner/Manager Dld DC
Mount Green 39,500 2007 Intership Navigation Donnelly Tanker Management Sep-07 E
NCC Rabigh 46,200 2007 Sabic NSCSA Sep-07 A
New Ranger 12,800 2007 Modion Maritime Modion Maritime Sep-07 E
Ning Hua 420 3,648 2007 Nanjing Tanker Corporation (Chems) Zhuhai Changjiang Aug-07 A
Overseas Long Beach 46,815 2007 OSG Group OSG Group Jul-07 A
Ozay 5 10,800 2007 Halikarnas Gemi Sanayi Halikarnas Gemi Sanayi Sep-07 A
Pantelis 10,800 2007 SK Shipping (Singapore) Lotus Shipping Aug-07 A
Papillon 47,000 2007 Samos Samos Jul-07 H
Royal Peridot 13,000 2007 NHL Development Co. Ltd./ Hanjin Sekwang Jul-07 A
Ryoei Maru No. 2 2,000 2007 Kokuka Sangyo Kokuka Sangyo Jul-07 D
Sea Lion I 13,062 2007 Perosea Perosea Aug-07 A
Seamarlin 40,500 2007 German Tanker Shipping German Tanker Shipping Jul-07 H
Seamercury 45,800 2007 Nisshin Nisshin Aug-07 H
Sichem Marseille 12,927 2007 Reliance Eitzen Jul-07 A
Sichem Melbourne 12,936 2007 Eitzen (Sokana) Eitzen Jul-07 A
Siteam Explorer 46,190 2007 Eitzen (Sokana) Eitzen Jul-07 A
Southern Condor 14,200 2007 Tatsumi Marine Co, Ltd. Tatsumi Marine Co, Ltd. Jul-07 A
Spring Euro 3,500 2007 Daiichi Tanker Daiichi Tanker Jul-07 A
STOC Marcia 4,514 2007 STOC Tankers STOC Tankers Jul-07 D
Sunrise Acacia 12,000 2007 Uyeno Transtech Ltd. Kyowa Sansho Sep-07 A
Sureyya Vardal 3,600 2007 Veysel Vardal Veysel Vardal Sep-07 A
Tarnbris 10,250 2007 Tarntank Tarntamk Jul-07 E
Tolson Sea 7,600 2007 OMCI OMCI Jul-07 D
Tverskoy Bridge 47,400 2007 Sovcomflot Sovcomflot Aug-07 H
Usma 51,800 2007 Latvian Shipping Latvian Shipping Aug-07 E
Wappen von Dresden 8,250 2007 Poseidon Wubbe H.H. Sep-07 A
Waseela 1 6,200 2007 Dubai Shipping Dubai Shipping Aug-07 H
Yong Sheng 36 7,200 2007 East Harbour East Harbour Aug-07 A
Source: Drewry

L4 Chemical carrier demolition sales in 3Q07
Ship Name DWT Built Operator Owner/Manager Last Ex Name DC IMO No Comments Retired
Aegean Trader 31,374 1980 Champion Tankers Champion Tankers Lampedusa RF 7612204 Scrapped Banglsdesh $540/ldt Aug-07
Fu Yu 3,575 1976 China Govt. Nanjing China Govt. Nanjing Ning Hua 404 RA 7340863 Scrapped China Sep-07
Norwave 29,994 1982 Norchart Teekay Scarlet Star RF 8001945 Scrapped Pakistan $435/ldt Aug-07
Putri Sakti 6,597 1979 Tirta Cipta Mulya Persada Tirta Cipta Mulya Persada Tirta Niaga II RH 7823619 Scrapped Bangladesh Jul-07
Source: Drewry

3Q2007
105
3Q2007
106
L5 Chemical time charter fixtures in 3Q07
Ship Name DWT Built Type Operator Owner/Manager DC Comments
Acor 37,000 2007 coated Norden Geden Line D TC to June 2010 $19,800 pd
Astral 11,317 2006 coated Clearlake Veritas Tankers A TC to June 2009 $13,000 pd
Besiktas Scotland 18,000 2007 coated BP Shipping Besiktas Denizcilik A TC to Sept 2008 $17,000 pd
Chang Hang Tan Suo 46,000 2006 coated Westport Nanjing Tanker Corporation H TC to July 2012 $22,200 pd
Dukhan 37,283 2003 coated Dorado Tanker Pool Qatar Shipping D TC to May 2010 $21,500 pd
Elka Glory 44,481 2003 coated European Product Carriers European Product Carriers E TC to July 2010 $23,000 pd
Favola 37,320 2002 coated Handytankers - Enel Motia AA TC to Oct 2011 $18,000 pd
FR8 Adria 46,941 2005 coated AOT from FR8 Dhipping Uljanik Plovidba E TC to July 2010 $24,750 pd
FR8 Endeavour 50,546 2006 coated Weco K-One Shipping Pte. Ltd. A TC to 2016 $20,000 pd
FR8 Spirit 50,100 2006 coated FR8 Shipping Navig8 A TC to 2016 $20,000 pd
Futura 40,085 2006 coated Weco - Handytankers Millenia E TC to Jun 2008 $22,500 pd
Hegren 19,700 2007 stst IPPC Bryggen A TC to Sept 2010 $19,400 pd
High Priority 46,847 2005 coated Petrobras D'Amico H TC to June 2008 $24,000pd
High Wind 46,473 1999 coated D'Amico D'Amico E TC $13,350 pd
Ioannis P. 46,345 2003 coated Petrobras Top Tankers E TC to Dec 2008 $24,000 pd
Kingfisher 34,586 2005 coated CSSA - Handytankers Motia E TC to 2009 $19,000 pd
Liquid Crystal 7,623 1989 stst Oram Tanker Ltd Elmira Shipping & Trading A TC to Apr 2008 $10,250 pd
Marin 4,200 2007 coated Herning Shipping Admibros D TC to Aug 2009 $7500 pd
Nord Observer 47,000 2007 coated Petrobras Sanko Steamship H TC to Jul 2008 option to May 2009 $22,500 pd
Nord Sea 45,987 2003 coated Norient Product Pool A/S Cido Shipping H TC to Sept 2012 $22,500 pd
Norient Product Pool A/S -
Nord Stream 45,974 2003 coated Orient Marine H TC to 2009 $22,000 pd
STX Pan Ocean Shipping
Nordic Ruth 35,820 2000 coated Handytankers - ST Shipping Nordic Seaarland E TC to Jul 2012 $20,250 pd
Ocean Dignity 34,999 2006 coated FR8 Shipping Roxana bb from Union Marine Finance H TC to Sept 2007 $20,000 pd
Okhotsk Sea 47,363 1999 coated Chevron Sovcomflot E TC to July 2012 $21,750 pd
Sea Challenger 13,062 2006 coated Shell Perosea A TC to Jul 2008 opt 1 yr. $15,500pd
Sichem Marseille 12,927 2007 marine line Reliance Eitzen A TC to July 2009 $15,500 pd
Silver Lining 46,013 2003 coated Petrobras Orient Marine E TC to dec 2010 $22,750 pd
Tavricheskiy Bridge 41,158 2006 coated Statoil Sovcomflot H TC to Jun 2009 $22,500 pd+H70
Troma 5,565 2007 marine line Statoil Mowinckels A TC to June 2008 $10,000 pd
Valerie 19,819 2002 stst Chem-Tankers CV Guy Somers/Hanseatic A TC to Jun 2008 opt 1 yr. $19,500 pd
Source: Drewry

L6 Chemical carriers converted to DH in 3Q07
Ship Name DWT Built DC Operator Owner/Manager Comments
Acrone S. 17,654 1985 F Golden Lotus Maritime Golden Lotus Maritime

Acushnet 35,589 1981 AA Protrans B & H Equimar Singapore Will convert 2nd half 2007
Addarraq 23,953 1982 B Marphocean Marphocean
Aetos 37,405 1980 D Aegean Jet Aegean Jet
Agawam 36,256 1982 D Product Transport (S) B & H Equimar Singapore

Agiasma 29,999 1989 H Project Project
Al Farabi 23,953 1982 B Marphocean Marphocean
Al Kortoubi 24,225 1986 B Marphocean Marphocean
Algonquin 35,596 1983 H Product Transport (S) B & H Equimar Singapore
Ama 3 3,606 1981 A Ama Marine Ama Marine
Amundsen Wind 17,585 1985 H Eastwind East Wind
Analisa 4,333 1978 A Wilmar Trading (Raffles) Wilmar Trading (Raffles)
Anawan 36,256 1981 AA Fairfield B & H Equimar Singapore
Anna 7,264 1985 E Clan Shipping Clan Shipping Converted to DH
Annoula 40,490 1982 D IMS International Project
Antonis A. 39,702 1982 C Olympic Gulf Tankers Olympic Gulf Tankers
Aquamarine I 40,890 1984 E Trust Oil Trust Oil
Aquidneck 36,256 1981 D Product Transport (S) B & H Equimar Singapore
Arabian Wind 17,484 1987 A Eastwind East Wind
Arafura Wind 17,843 1988 F Eastwind East Wind
Aral Wind 17,430 1988 H Eastwind East Wind
Arctic Swan 4,225 1970 E Brostrom Tankers AB Uni-Tankers Converted to DH
Aries 29,790 1993 H Columbia Columbia Shipmanagement
Atlantia 33,374 1984 H Glory Ship Management Glory Ship Management
Azov Wind 17,523 1988 A TMM (Mexico) East Wind
Ben Aicha 24,210 1987 B Marphocean Marphocean
Biz 40,455 1984 E Delfi Delfi
Black Pearl 48,531 1982 H Maritime Mssa Maritime Mssa
3Q2007
107
3Q2007
108
L6 Chemical carriers converted to DH in 3Q07 cont’d
Bow Cheetah 40,258 1988 B Odfjell-Seachem Odfjell Asia II

Bow Leopard 40,249 1988 A Odfjell-Seachem Odfjell Asia II
Bow Lion 40,272 1988 A Odfjell-Seachem Odfjell Asia II
Bow Panther 40,263 1986 A Odfjell-Seachem Odfjell Asia II
Bow Puma 40,092 1986 A Odfjell-Seachem Odfjell Asia II
Bum Mi 10,460 1997 A STX Pan Ocean Shipping STX Pan Ocean Shipping
Bum Woo 10,452 1997 A STX Pan Ocean Shipping STX Pan Ocean Shipping
Caroline 7 7,010 1984 A SK Shipping (Singapore) Sekwang Shipping Co. Ltd.
Catur Samudra 5,500 1994 E Humpuss Intermoda Transportasi Humpuss Intermoda Transportasi
Central Success 9,093 1983 B Chinese Operator Fujian Xinhai Shipping
Champion 38,500 1983 A Champion Tankers Champion Tankers
Champion Adriatic 38,800 1981 A Champion Tankers Champion Tankers
Champion Arctic 47,750 1986 A Champion Tankers Champion Tankers
Champion Pacific 38,500 1982 A Champion Tankers Champion Tankers
Champion Pioneer 40,525 1990 G Champion Tankers Champion Tankers
Champion Polar 47,750 1986 A Champion Tankers Champion Tankers
Chem Bridge 8,511 1996 B Bridge Marine Co. Ltd. Bridge Marine Co. Ltd.
Chem Cosmos 29,990 1986 A SH Marine Ltd. SH Marine Ltd.
Chem Jasmin 29,990 1986 A SH Marine Ltd. SH Marine Ltd.
Chun Feng 7,134 1984 A Sinochem-Stolt Sinochem Converted to DH IMO 2
Concord 37,642 1985 D Glory Ship Management Glory Ship Management
Concord I 38,960 1980 B Sea World Management Sea World Management
Diana 9,306 1985 A Kwantas Wiseberg Holdings
Dolphina 12,900 1983 D Kwantas Kwantas (Guangzhou Sunny Ocean)
Doris 19,960 1984 D Kwantas Kwantas (Teltro Maritime)
Doroussa 54,500 1982 D Dileton Maritime Dileton Maritime
Eastern Glory 6,925 1987 A Glory Tanker Transportation Guangzhou Minyang SM Converted to Double Hull
EW Harting 29,998 1991 H Eastwind East Wind

EW Hastings 29,998 1990 H Eastwind East Wind

EW Henfield 29,998 1991 H Eastwind East Wind
EW Horsham 29,998 1992 H Eastwind East Wind
Converted to DH Change DC Code
Fair Luna 40,792 1982 D Fair Deal Fair Deal
Owner, Operator etc. - $ 8.8m June 05
22,729 1982

Fantasy I F Navimar Navimar
Farandol 40,537 1988 G Delfi Delfi
Fidelity I 44,911 1984 D Pioneer Tankers Pioneer Tankers Converted
Heung Yang 6,653 1984 A Seong Ho Shipping Co. Ltd. Seong Ho Shipping Co. Ltd.
Integrity I 23,973 1984 A Bryggen Harmony Navigation
Ionian Trader 40,632 1984 A Champion Tankers Champion Tankers
Iran Bahonar 40,325 1983 G IRISL NITC
Iran Rajai 40,367 1983 C IRISL NITC
Jo Birk 39,016 1982 B Jo Tankers Jo Tankers
Jo Brevik 32,992 1986 A Jo Tankers Jo Tankers
Jo Clipper 33,549 1981 A Jo Tankers Jo Tankers/Executive SM
Jo Lind 33,532 1982 A Jo Tankers Jo Tankers/Executive SM
Jo Lonn 39,273 1982 B Jo Tankers Jo Tankers
Jo Oak 39,161 1983 B Jo Tankers Jo Tankers
Kasco 31,745 1981 E Delfi Delfi
Kassiopea 8,080 1992 B Asteristos Navigation Asteristos Navigation
L.Star 6,739 1984 A SK Shipping (Singapore) SK Shipping
Liquid Crystal 7,623 1989 A Tatsumi Marine Co. Ltd. Elmira Shipping & Trading
Mekhanik Khachepuridze 5,728 1984 A Novik Odessa Russia
Mercure 29,751 1992 H Columbia Columbia Shipmanagement
Merlin Champion 38,529 1982 A Champion Tankers Merlin Tankers
Merlin Trader 38,452 1983 A Champion Tankers Merlin Tankers
Mont Blanc 39,702 1981 B Eitzen (Sokana) Greece
Monte Luna 39,742 1983 B Eitzen (Sokana) Greece
3Q2007
109
3Q2007
110
New Setokaze 18,566 1983 H Glory Ship Management Glory Ship Management
New Toyokaze 19,918 1984 B Glory Ship Management Glory Ship Management
Norlake 39,013 1982 A Norna Shipping Norna Shipping
Norna N. 46,122 1982 D Norna Shipping Norna Shipping
Pegasus 7 19,995 1986 B Bridge Marine Co. Ltd Sekwang Shipping Co. Ltd.
Converted to DH Correct CBM IMO
Pequod 40,634 1982 A Product Transport (S) B & H Equimar Singapore

Class and DC Code
Petros 39,722 1984 C Delfi Delfi
Prosperity I 12,691 1985 B Bryggen Olympic Gulf Tankers
Rising Phoenix 39,717 1987 H Warm Seas Development Warm Seas Development
Seapurha 39,672 1987 D Thenamaris Thenamaris
Skawhegen 37,314 1981 D Delfi Delfi
Skychemi 9,304 1985 A Sunwoo Merchant Marine Co Sunwoo Merchant Marine Co Converted to Double Hull - $6m
Stolt Hill 40,160 1992 A Stolt-Nielsen Stolt-Nielsen
Stolt Mountain 40,024 1994 A Stolt-Nielsen Stolt-Nielsen
Stolt Peak 40,041 1991 A Stolt-Nielsen Stolt-Nielsen
Stolt Taurus 12,749 1985 B Stolt-Nielsen Olympic Gulf Tankers
Sun Asia 8,846 1991 B Sunwoo Merchant Marine Co. Ltd. Sunwoo Merchant Marine Co. Ltd.
Sunny Giant 6,119 1990 F Asahi Tanker Korea Asahi Tanker Co. Ltd
Sunny Hawk 6,115 1991 D Asahi Tanker Co. Ltd Asahi Tanker Co. Ltd
Symphony I 39,013 1982 B Bryggen Harmony Navigation
Tabtim 4,699 1978 D Ama Marine Ama Marine
Theresa II 12,985 1982 D Wilmar Trading (Raffles) Wilmar Trading (Raffles)
Theresa III 16,983 1980 D Wilmar Trading (Raffles) Wilmar Trading (Raffles)
Theresa Jupiter 17,621 1980 A Wilmar Trading (Raffles) Raffles Shipping
Theresa VIII 22,294 1981 A Wilmar Trading (Raffles) Wilmar Trading (Raffles)
Tour Margaux 9,063 1992 B Eitzen (Navale Francaise) Eitzen (Navale Francaise)
Transport 39,738 1983 B Delfi Delfi
V.L.5 2,498 1988 A V.L. Enterprise V.L. Enterprise

Venus 7 16,933 1986 A Bridge Marine Co. Ltd Sekwang Shipping Co. Ltd.
Veracity 40,520 1983 G Weco Pioneer Tankers
W.S.Challenger 45,306 1982 D Warm Seas Development & Trading Warm Seas Development & Trading
Westama 40,293 1983 E Project Project Converted to DH
Wine Trader 2,223 1968 E Tamora Tamora Converted to DH

World Dynasty 13,529 1991 A Hyundai Merchant Marine Neptune Marine Corporation
Xing Hua 2,999 1993 A Shanghai COSCO-Shokuyu COSCO Xiamen
Yanee 3,021 1987 D Ama Marine Ama Marine
Source: Drewry
3Q2007
111
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Chemical Forecaster 3Q07

Quarterly Forecasts of the Chemical Shipping Market

Capt Ken Tree

© Drewry Shipping Consultants Ltd 2007

2. Economy and trade 07

2.4.2 Organic trade 23

3. Chemical tanker shipping 27

© Drewry Shipping Consultants Ltd i

4.10.1 Middle East Gulf 59

5. Veg oils, fats and molasses market 65

5.3.3 Indian Ocean 82

6. Profile – MISC Berhad 91

ii © Drewry Shipping Consultants Ltd

1.1 Time charter rates: modern vessels 01

2.16 Japan: organic chemical imports 16

© Drewry Shipping Consultants Ltd iii

3.7 Chemical tanker deliveries 33

4.2 Jubail exports Jan-July 2007 by owner share 60

iv © Drewry Shipping Consultants Ltd

5.18 Coconut oil : oil world balance 84

1.1 Chemical tanker freight rate index 01

2.2 EU25 – industrial production, imports and exports 08

© Drewry Shipping Consultants Ltd v

4.5 Spot rates: NW Europe to India/Asia and Far East 56

5.1 2001-2007 main commodity trade lanes 66

vi © Drewry Shipping Consultants Ltd

+ Increase in newbuilding prices Chemical tanker freight rate index

2005 13,889 16,017 10,475 19,472 Supply Demand

2009 14,000 18,000 12,000 20,000 60,000

© Drewry Shipping Consultants Ltd 01

Deep sea market

During the third quarter freight rates fell across the

30,000+ dwt orderbook development ('000 dwt)

02 © Drewry Shipping Consultants Ltd

Overall, 3Q07 was a dull period for the regional markets.

Supply Demand Intra SEA Latin America-US

10-20,000 dwt orderbook development ('000 dwt)

© Drewry Shipping Consultants Ltd 03

Veg oils/animal fats market

Compared to the main chemical and CPP markets, oils

Veg oils/animal fats: inter regional seaborne

8,000 Intra SEA Latin America-SEA 50 Orderbook as a % of fleet

04 © Drewry Shipping Consultants Ltd

The market – at a glance

Estimated chemical tanker rates ($/day)

Spot rates ($/mt)

Newbuilding prices US$m

Secondhand prices US$m

© Drewry Shipping Consultants Ltd 05

2002 2003 2004 2005 2006 2007(e) 2008(e)

Global Economy 4.1 5.3 4.7 5.2 5.0 4.6 4.9

Industrial World 1.9 3.0 2.4 2.8 2.3 2.1 2.7

USA 2.7 3.9 3.1 2.9 2.0 2.0 2.9

Europe 1.1 2.1 1.7 2.9 2.6 2.0 2.5

France 1.1 2.3 1.7 2.2 1.8 2.0 2.6

Germany 0.0 1.2 0.9 2.9 2.4 1.9 2.2

UK 2.5 3.3 1.8 2.8 2.9 2.0 2.3

Japan 1.8 2.7 1.9 2.2 1.9 2.1 2.6

Asia ex Japan 7.0 7.9 7.9 8.6 8.4 7.6 7.6

China 10.0 10.1 10.4 11.1 11.3 10.0 9.5

India 7.4 7.0 8.7 9.6 8.4 7.3 8.3

Korea 3.1 4.7 4.2 5.0 4.6 4.8 5.3

Latin America 2.1 6.1 4.5 5.4 5.3 4.5 4.5