New York (Platts)--27Jul2007

Record freight rates for Capesize dry bulk carriers, driven by coal and
iron ore trades, have pushed the world orderbook for new ships of this size to
its highest-ever level, according to the world's largest ship broker.

     Shipowners ordered 10.7 million dwt of new Capesize capacity in the first
half of this year, worth $75 billion, pushing deliveries well into 2012, such
is the size of shipyards' orderbooks around the world, according to Clarkson
Research Services, the research arm of London-based Clarkson.

     The booming shipyard orderbooks are fueling demand for steel plate in
Southeast Asia, where most of the world's commercial shipbuilding activity is
centred.

     Earlier this week, Japan's Nippon Steel said that it would invest Yen 20
billion ($168 million) in raising capacity for high-grade steel plate
production by 600,000 mt/year at its Oita mill to meet soaring demand. The
plant's existing shipbuilding capacity is 2.2 million mt/year.

     The orderbook for ships of all sizes was worth a record $304 billion as
of July 1, according to Clarkson.

     According to other ship brokers, around 5 million to 6 million dwt of new
Capesize ships have been delivered by the shipyards in the first half of this
year, while nothing has been scrapped and there have been no Capesizes lost or
sunk so far this year A further 3 million dwt is due to be delivered in the
remainder of 2007, according to brokers. Brokers estimated the world fleet at
around 123 million to 124 million dwt.

     Next year, around 45 new ships aggregating 8.6 million dwt are due to be
delivered by the shipyards, while 2009 will see 65 ships (12.9 million
dwt), and the orderbook for 2010 onwards shows deliveries of around 125 ships
(21.8 million dwt), according to brokers.

     Shipbrokers argue that the market is likely to comfortably absorb the
increased fleet size next year, but may have more of an issue absorbing the
increases from 2009 onwards.

     "It's hard to tell, because all of our predictions since 2002 have proved
wrong and the increase in demand for iron ore by China alone has comfortably
absorbed the increases in the world Capesize fleet for four and a half years,"
said a broker. He added that the bulk of the new deliveries from the orderbook
would fall in 2011 and 2012.

		--Anthony Poole, anthony_poole@platts.com