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Current Status and Outlook of the Breakbulk, Heavylift and Project Cargo Segment

Current Status and Outlook of the Breakbulk, Heavylift and Project Cargo Segment . Maritime Saudi Arabia 30 May – 1 June 2010, Jeddah Hilton Jan B. Steffens • President & CEO Rickmers-Linie. Current Status and Outlook of the Breakbulk, Heavylift and Project Cargo Segment.

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Current Status and Outlook of the Breakbulk, Heavylift and Project Cargo Segment

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  1. Current Status and Outlook of the Breakbulk, Heavylift and Project Cargo Segment Maritime Saudi Arabia 30 May – 1 June 2010, Jeddah Hilton Jan B. Steffens • President & CEO Rickmers-Linie

  2. Current Status and Outlook of the Breakbulk, Heavylift and Project Cargo Segment • Definition of the multipurpose fleet • Supply • Demand • Conclusion

  3. The Multipurpose FleetDefinition • The multipurpose vessel is a non-cellular vessel, it can carry nearly all types of dry cargo, it is not specified for the exclusive carriage of a certain commodity • The multipurpose vessels can be classified by certain characteristics: - With or without cargo ramp - With or without heavy lift cranes - Box-shaped - With or without tween decks - Semi-submersible etc. • The today‘s multipurpose vessel evolved from the former conventional dry cargo vessel

  4. Development of the Multipurpose Fleet1955/2005 – 2010 • Within sixty years, the MPP fleet declined from 86 million dwt to 33,8 million dwt. • Specialisation of the dry cargo fleet (Container, Bulk) has cut back the MPP portion from 96% to 7%. • In the last five years the MPP fleet has grown again by 3,4 million dwt • The current orderbook stands at 8,8 million dwt • Orderbook is roughly a quarter of current fleet 12000* 4147 4046 3916 3761 3613 3525 756 * = number of vessels Source: Clarksons April 2010

  5. Age Structure of the Multipurpose Fleet • 34% of the total fleet is 25 yrs and older • 43% is 20 yrs and older • Still less than half of the fleet meets the quality requirements of project customers (< 16 yrs) • As a consequence of missing investments in the 90ies the current fleet is overaged. 960 677* 526 643 522 376 443 Source: Clarksons April 2010

  6. Overaged Multipurpose Fleet vs. Orderbook • The orderbook represents two thirds of the fleet older than 25 years • The orderbook represents roughly half of the fleet older than 20 years • In contrast to other segments of the shipping industry the orderbook will not increase the capacity but will replace older tonnage. 1579 1203* 756 Source: Clarksons April 2010 * = number of vessels

  7. How did the crisis affectthe breakbulk, heavylift and project cargo segment? • Volumes and freightrates for breakbulk cargo came under pressure. • Projects in the oil- and gas-, petrochemical-, mining- and steelindustries were put on hold. • Contracted cargo could not be shipped due to letter of credit issues. • Long lead time of projects decelerated the decline of cargo volumes in the multipurpose segment.

  8. Outlook for the breakbulk, heavylift and project market • The global GDP growth will rebounce to pre-crisis levels (Forecast for 2010: 4,2% and for 2011: 4,3%) • Massive economic stimulus packages have fostered infrastructure and energy related projects worldwide. • Demand for electricity is increasing worldwide, large backlog in China, India and developing countries. According to the IEA 225 gigawatt of power supply have to be added year on year until 2030. • Demand and environmental constraints push construction, replacement and modernisation of power plants. • The call for renewable power supply stimulates wind power projects.

  9. Outlook for the breakbulk, heavylift and project market • Renaissance of nuclear power plants. • The growing demand for raw materials fuels mining projects. • Worldwide demand for oil and gas projects will increase. The IEA estimates that USD 1 Billion needs to be invested every day into oil exploration and processing in order to keep demand and supply in balance. • Several projects (refinery, petrochemical, oil and gas exploration) are on their way or on the drawing boards.

  10. Conclusion • The multipurpose sector is not immune against the aftermath of the global crisis. • The growth of the global GDP and the on-going globalisation fuel the demand for projects like infrastructure, power, oil and gas, petrochemical, industrial plants etc. • The forthcoming size of a modernised and well equipped multipurpose fleet is needed for the realisation of these projects.

  11. Thank you!

  12. Contact details Jan B. SteffensPresident & CEO RICKMERS-LINIE GmbH & Cie. KGNeumuehlen 19 22763 HamburgGermanyTel +49 (0)40 38 91 77-200Fax +49 (0)40 38 91 77-274info@rickmers.netwww.rickmers-linie.com

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