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1 ALPHALINER Volume 2013 Issue 51 Weekly Newsletter to Web: Sales: Unauthorized redistribution of the newsletter is prohibited and readers are requested to quote Alphaliner as source for all data derived from the newsletter. Alphaliner does not accept any liability for any errors or omission or opinion. Please refer to full user terms and copyrights at Alphaliner Weekly Newsletter is distributed every Monday. The newsletter is available upon subscription. Information is given in good faith but without guarantee. Please send your feedback, comments and questions to Chart of the week Containership deletions by Month : Total containership deletions are expected to exceed 450,000 teu in 2013, the highest level of annual deletions ever recorded. The high level of deletions comes from a surge in the scrapping of 3,000-5,000 teu ships, with 76 units sold for demolition in this size range, including 33 units that were younger than 20 years of age. New containership deliveries still outpace deletions by a ratio of 3 to 1, with the fleet capacity growth expected to approach 6% in 2013, and full year deliveries to reach 1.39 Mteu. The pace of supply growth is expected to rise in 2014 with a record of 1.6 Mteu due to enter the market. TEU deleted by Month 60,000 50,000 40,000 30,000 20,000 10,000 Other deletions Scrapped 0 Jan-08 Jan-09 Jan-10 Jan-11 Jan-12 Jan-13 ALPHALINER Containership deletions to reach new record INSIDE THIS ISSUE: New scrapping record 1 Corporate Updates UASC opts for advanced dualfuel LNG option Service Updates 4 G6 unveils new Transpacific & Transatlantic service rotations Maersk to add Panama-ECSA direct connection Maersk to add US Gulf-Central America direct connection CCNI develops Central America coverage Hartmann to launch second Europe-West Africa service Marguisa connects Equatorial Guinea to North Europe Borchard Lines to replace own North Europe-Med service by slots Swire and Carpenters team up on PNG Delivery/New Order Updates December Deliveries Paragon Shipping cancels wide-beam newbuilding 3 11 The total capacity deleted from the containership fleet is expected to exceed 450,000 teu in 2013, breaking the previous record of 377,000 teu deleted in Based on the latest reported scrap sales, of the 197 ships to be deleted this year, 184 units (435,200 teu) were scrapped, 9 units (8,300 teu) were converted to non-container use and 4 units (11,400 teu) have either sunk or were damaged beyond repairs. The average age of scrapped units reached an all-time low of 22 years, compared to the historical average of 28 years. The younger age at which ships are scrapped reflects the weak trading conditions and excess supply of vessels, especially in the 3,000-5,000 teu range which have kept charter rates below breakeven levels in this segment. 59 units of less than 20 years old were scrapped in 2013, with the youngest ship at only 14 years old - the 1999 built OCEAN PROVIDER, ex NORASIA SELINA (1,538 teu), which was disposed prematurely due to technical flaws in its design. The average size of scrapped ships also hit an all-time high, reaching 2,365 teu as a record number of 3,000-5,000 teu ships were sent for demolition. 76 ships have been sold for scrap in this size range, including eight overpanamax units, while 58 newbuildings of this size joined the fleet in the same time, of which 39 overpanamaxes. The largest containership scrapped was the 4,953 teu MSC CATANIA (built 1994), although the largest unit deleted in the year was Page 1 Copyright Alphaliner

2 Charter Rate $/day Weak charter rates and relatively firm scrap prices have encouraged scrappings of younger ships in 2013, in particular for the chronically oversupplied 3,000-5,000 teu sector. The 4,729 teu APL SPINEL (built 1996) was reported sold as is in Singapore last week for a relatively strong scrap price of $450/ ldt including remaining fuel onboard, with panamax owners unable to find any profitable trading opportunities. Diana Containerships had acquired the APL SPINEL and sister APL SAR- DONYX for $30 M each in early 2012 but will get less than $10 M from the scrap sale ,000 30,000 25,000 20,000 15,000 10,000 5,000 0 Alphaliner Charter Rates ,000 teu 2,500 teu 1,700 teu 1,000 teu ALPHALINER 700 Demolition price (Subcontinent) $/ldt 600 the 8,110 teu MOL COMFORT (built 2008) which sank after breaking into two parts in June. The MOL COMFORT is the largest containership casualty ever recorded. Units deleted by year Containership deletions by size range : >5,000 teu 4,000-5,000 teu 3,000-4,000 teu 2,000-3,000 teu 1,000-2,000 teu <1,000 teu Average size deleted ,500 2,000 1,500 1,000 0 ALPHALINER With panamax earnings expected to remain under pressure in the foreseeable future, more ships of this class are expected to be scrapped in 2014 and The opening of the new Panama Canal locks, planned for late 2015, will deal a further blow, although this third set of locks could become saturated by too many ships queuing up to transit. This would entice the owners of the current panamax units to retain them as they could continue to transit via the 'old' locks, comparatively less busy. The postponement of the Ballast Water Treatment obligations will also bring some respite. Scrappings could also be boosted by the China s proposed new scrapping subsidy of RMB 1,500 per gross ton applicable from 2013 to 2015, which would be granted in two tranches of RMB 750/GRT ($123/GRT) each - first upon completion of the vessel demolition and another after the construction of a replacement vessel at a Chinese yard. However, this applies only to Chinese flagged ships scrapped locally, which will mainly benefit the state-owned companies, including CO- SCO and CSCL, whose old containerships would obtain higher scrap prices than in the sub-continent. There are some 70 Chinese-flagged containerships built before 1996, totalling 125,000 teu, that could be scrapped in this context, with half of these units owned by COSCO and CSCL Average size (TEU) ALPHALINER Total new containership deliveries continue to grow at a high pace. Full year 2013 deliveries are expected to reach 1.39 Mteu, the second highest annual capacity delivery figure after the 1.58 Mteu recorded in Deliveries continue to outpace deletions by a ratio of 3 to 1, with the total fleet capacity growth expected to be just shy of 6% in The pace of supply growth is expected to rise in 2014 with a record of 1.6 Mteu to enter the market. Page 2 Copyright Alphaliner

3 CORPORATE UPDATES UASC opts for advanced dual-fuel LNG option UASC will expand its fleet with new super-efficient container vessels, prepared for dual fuel through a later LNG Fuel Gas Supply System (FGSS) retrofit after the delivery of the vessels. Through a technical cooperation with Japan Marine United Corporation (JMU) and IHI Corporation (IHI), Hyundai Heavy Industries Co., Ltd. (HHI), the shipbuilder for UASC intends to obtain an Approval in Principle (AiP) from UASC s designated classification society, DNV-GL, for the FGSS and the LNG fuel tank. The AiP is intended to apply to UASC s current newbuilding order of five 14,000 TEU vessels with six options and five 18,000 TEU vessels with one option. Dual fuel refers to ordinary fuel oil as well as Liquefied Natural Gas (LNG). LNG is a cleanerburning, less expensive and real alternative to crude oil products... The selected low pressure IHI- SPB Tank is unique and the volume of fuel that can be stored on board is by far the greatest of any LNG-powered vessel to date. UASC statement 12 December 2013 UASC is to opt for a radical choice for the storage of Natural Gas aimed at feeding the dual-fuel engines which will propel the ships of 14,000 teu and 18,000 teu that it ordered in August at Hyundai H.I.. In a statement released last week, UASC says that it would adopt the 'IHI-SPB Tank' technology to store the Liquefied Natural Gas (LNG). The SPB (self supporting prismatic tanks IMO type-b) LNG containment system was pioneered by Ishikawajima Harima Heavy Industries (IHI) in the 1990s and is applied on a handful of LNG tankers. The IHI-SPB system allows to store Natural Gas under liquid form at atmospheric pressure under a temperature of minus 162 deg C, which is a bold move for bunkering purposes, compared to the solutions so far retained by other carriers having opted for NG. The other orders concern mostly ships running short sea shuttles calling at established terminals, facilitating the set up of gas refilling stations at one end of the rotation, with refilling occurring on each voyage. Natural Gas is an effective solution for short sea shuttles given the bulkiness and cost of NG tanks, which in the case of the short sea ships, store the gas under CNG or CLNG form in IMO type C tanks of limited dimensions, but not as atmospheric pressure LNG, a solution used in large LNG tankers. The SPB system appears to be the most adequate system to store LNG for bunkering purposes at atmospheric pressure, compared with the two competing solutions also used in LNG tankers : the sphere-based system and the membrane system (although this latter comes close to the SPB in terms of bunker tanks requirements despite some design constraints). It is not clear yet if UASC intends to burn NG on whole Far East- Europe rotations or only during the time the ships will spend in SECA zones, but retaining such an expensive storage solution leads to think that the ships could run on NG for the whole rotation in order to recoup the extra investment, despite uncertainties on energy markets and the overall economics of gas burning in relation to regulations. The ships could call in Middle East in both directions in order to refill for each half FE-Europe rotation, as this would allow to minimize the volume and cost of the NG tanks (despite their relative compactness, IHI-SPB tanks remain bulky to ensure sufficient fuel to last for several weeks). There also remains the refilling logistics issue although UASC, being the only large carrier based in the Middle East, and with leading gas producers among its shareholders, may find it easier to strike a deal with local suppliers in the Gulf region. The UASC ships will not be initially equipped for NG fuel at delivery, but will receive the LNG Fuel Gas Supply System (FGSS) retrofit after the delivery of the ships. Page 3 Copyright Alphaliner

4 SERVICE UPDATES G6 unveils new Transpacific service rotations The G6 alliance (APL, Hapag-Lloyd, HMM, MOL, NYK, OOCL) have unveiled some details of the planned expansion of their partnership to the Asia-WCNA sector. The G6 partners will offer a total of 14 weekly Far East to North America West Coast connections, with ten services aimed at the Pacific South West and four services aimed at the Pacific North West. They will complement the existing G6 FE-USEC services, which will retain the current six weekly connections to which will be added the PAX/AP2 pendulum covering the FE-WCNA-USEC- North Europe sector and the APX pendulum, which covers the FE- USEC-North Europe sector via Panama. Zim is expected to participate on some of the FE-WCNA loops. The planned G6 FE-USWC services will be the most comprehensive of all carrier alliances on the trade, with ten weekly connections to PSW and four weekly connections to PNW. By comparison, the proposed P3 alliance will only offer five weekly connections to PSW and one weekly connection to PNW. The rival CKYH alliance currently offers seven weekly connections to PSW and four weekly connections to PNW. A total of 86 ships of between 3,800 and 10,000 teu will be initially deployed on the FE-WCNA services (excluding extra vessels needed for the pendulum services), with an average weekly capacity of over 88,000 teu, of which 61,000 teu will serve the Pacific South West and 27,000 teu will serve the Pacific North West. It will feature a complete revamp of the services currently operated separately by the Grand Alliance (Hapag-Lloyd, NYK, OOCL) and New World Alliance (APL, HMM, MOL), with the rationalization of port calls to maximise the coverage offered by the six carriers. Although it will initially deploy the ships used on the current services, network upgrades with larger ships are expected as the individual G6 members receive additional newbuildings over the course of 2014 and Of note, the PSW services will focus initially on the Los Angeles gateway, but will cater to the different terminal interests of its component members (APL, HMM, MOL and NYK each operate individual terminals in Los Angeles while OOCL operates the LBCT terminal in Long Beach which is currently undergoing a massive upgrade). Service Vessels Deployed The planned rotations of the G6 Transpacific services are as follows, for implementation in April 2014, subject to regulatory approval: FE - Pacific South West SE1 (SGX) 8 x 5,600-6,600 teu Singapore, Laem Chabang, Yantian, Los Angeles, Oakland, Busan, Shanghai, Ningbo, Yantian, Singapore SE2 (SE1) 8 x 5,600-6,600 teu Singapore, Shekou, Kaohsiung, Los Angeles, Yokohama, Kaohsiung, Singapore SE3 (SE2) 7 x 7,500-8,600 teu Laem Chabang, Cai Mep, Hong Kong, Los Angeles, Oakland, Hong Kong, Laem Chabang SC1 SC2 6 x 9,200-10,000 teu Xiamen, Shekou, Yantian, Los Angeles, Oakland, Xiamen 6 x 7,500-8,600 teu Dachan Bay, Yantian, Hong Kong, Kaohsiung, Los Angeles, Hong Kong, Dachan Bay CC1 (PCX) 6 x 5,600-8,900 teu Shanghai, Kwangyang, Busan, Los Angeles, Oakland, Busan, Kwangyang, Shanghai CC2 CC3 CC4 JAS 5 x 5,600-6,600 teu Ningbo, Shanghai, Los Angeles, Shanghai 6 x 5,600-6,600 teu Qingdao, Xingang, Busan, Yokohama, Los Angeles, Oakland, Tokyo, Busan, Qingdao 5 x 4,700,6,300 teu Ningbo, Shanghai, Los Angeles, Oakland, Ningbo 5 x 3,750-4,200 teu Kobe, Nagoya, Shimizu, Tokyo, Los Angeles, Oakland, Tokyo, Kobe Page 4 Copyright Alphaliner

5 Service Vessels Deployed PN2 (PNW) 6 x 7,500-8,100 teu Pacific North West Hong Kong, Yantian, Kaohsiung, Shanghai, Busan, Tacoma, Seattle, Vancouver, Yokohama, Busan, Kwangyang, Hong Kong PN3 (NWX) 6 x 7,900-9,200 teu Qingdao, Ningbo, Shanghai, Busan, Vancouver, Tacoma, Vancouver, Tokyo, Nagoya, Kobe, Ningbo PN4 (PNX) 7 x 7,400-8,600 teu AP2 (PAX- Pendulum) 14 x 3,800-4,900 teu (5 for TP) Singapore, Laem Chabang, Dachan Bay, Hong Kong, Yantian, Vancouver, Tacoma, Seattle, Busan, Kaohsiung, Singapore Yokohama, Shanghai, Busan, Kobe, Nagoya, Tokyo, Tacoma, Vancouver, Oakland, Los Angeles, (US East Coast & North Europe), Los Angeles, Oakland, Yokohama As for the FE-USEC services, they will remain mostly as they are, with some minor changes to the port rotations. The ships used will also remain unchanged from those currently deployed but larger vessels are similarly expected to be deployed over the course of 2014 and Service Vessels Deployed NYE NCE 10 x 3,800-4,900 teu The APX pendulum, which is currently operated by the New World Alliance (APL, HMM, MOL) outside of the G6 arrangement, will be added as an additional G6 string. It will also be supplemented by the Grand Alliance (Hapag-Lloyd, NYK, OOCL) PAX pendulum which will focus on the FE-WCNA and North Europe-USEC/WCNA sectors. FE - US East Coast via Panama Kaohsiung, Ningbo, Shanghai, Busan, (Panama), Savannah, New York, Norfolk, Jacksonville, (Panama), Busan, Kaohsiung 9 x 3,800-4,900 teu Busan, Qingdao, Ningbo, Shanghai, (Panama), New York, Norfolk, Savannah, (Panama), Busan SCE 9 x 3,800-4,900 teu Xiamen, Kaohsiung, Dachan Bay, Hong Kong, Yantian, (Panama), Savannah, Charleston, (Panama), Busan APX (Pendulum) 13 x 3,500-5,000 teu (10 for TPS) Service Vessels Deployed CEC 11 x 7,500-8,600 teu Kaohsiung, Shanghai, Busan, Kobe, Tokyo, (Panama), Miami, Jacksonville, Charleston, New York, (N Europe), New York, Norfolk, Charleston, (Panama), Los Angeles, Oakland, Tokyo, Kobe, Kaohsiung FE - US East Coast via Suez Cai Mep, Hong Kong, Shekou, Yantian, Singapore, (Suez), New York, Savannah, Charleston, Norfolk, (Suez), Jeddah, Singapore, Cai Mep SVN AZX 10 x 5,600-6,700 teu 10 x 4,700-7,500 teu Cai Mep, Hong Kong, Yantian, Singapore, (Suez), Port Said, Algeciras, Norfolk, Savannah, Jacksonville, Charleston, Algeciras, Port Said, (Suez), Colombo, Singapore, Cai Mep Laem Chabang, Singapore, Colombo, (Suez), Port Said, Damietta, Cagliari, Halifax, New York, Savannah, Norfolk, Cagliari, Damietta, Port Said, (Suez), Jebel Ali, Singapore Page 5 Copyright Alphaliner

6 New G6 Transatlantic Network also unveiled The G6 will offer five weekly services on the North Europe-USEC route with a total weekly capacity of about 24,000 teu (compared to six NWA/GA services currently with about the same weekly capacity). The G6 Transatlantic cooperation will not extend to the Med-North America East Coast and North Europe-Canada services, which will be served by certain G6 members separately outside of the G6 arrangement (See our last issue). This includes the St Lawrence Coordinated Service (SLCS) which currently incorporates two loops, the GEX 1, operated jointly by Hapag-Lloyd, OOCL and MSC with a fleet of four ships of 2,800 to 4,300 teu, and the GEX 2, operated jointly by Hapag-Lloyd with OOCL with a fleet of three vessels of 4,400 teu. Service Vessels Deployed Transatlantic Services (final ports to be confirmed) TA1 4 x 7,000-8,000 teu New York, Norfolk, (UK Port TBC), Rotterdam, (German Port TBC), Le Havre, New York TA 3 6 x 3,800-4,700 teu Varacruz, Altamira, Houston, New Orleans, Miami, Jacksonville, (UK Port TBC), Antwerp, Bremerhaven, Le Havre, Veracruz GAX 5 x 2,500-3,200 teu Charleston, Port Everglade, Houston, Savannah, Norfolk, Antwerp, Bremerhaven, Southampton, Charleston APX AP2 (PAX) 13 x 3,800-4,900 teu (3 for TAS) 14 x 3,800-4,900 teu (5 for TAS) (Asia), Balboa, Manzanillo, Miami, Jacksonville, Savannah, Charleston, New York, Rotterdam, Bremerhaven, Felixstowe, Le Havre, New York/Norfolk TBC, Charleston, Savannah, Manzanillo, Balboa, Los Angeles, Oakland (Asia) (Asia) Tacoma, Vancouver, Oakland, Los Angeles, Manzanillo, Savannah, Norfolk, New York, Halifax, Southampton, Antwerp, Hamburg, Rotterdam, Halifax, New York, Norfolk, Savannah, Manzanillo, Los Angeles, Oakland (Asia) Maersk : ACX Service Details Amazonia Caribbean Express Slots on CMA CGM Brazex Manzanillo (Pan), Kingston, Manaus, Suape, Vitoria, Santos, Zarate, Buenos Aires, Montevideo, Rio Grande, Itajai, Paranagua, Santos, Rio de Janeiro, Salvador de Bahia, Port of Spain, Cartagena (Col), Manzanillo (Pan) Maersk to add Panama-ECSA direct connection Maersk Line is to re-launch a Panama-ECSA direct service through a participation on the CMA CGM's 'Brazilian Express' (Brazex) service, allowing to provide connections at the Panama hub of Manzanillo with Pacific-related services transiting the Panama Canal. The 'Brazex' serves Manzanillo (Pan), Kingston, Manaus, Suape, Vitoria, Santos, Zarate, Buenos Aires, Montevideo, Rio Grande, Itajai, Paranagua, Santos, Rio de Janeiro, Salvador de Bahia, Port of Spain, Cartagena (Col), Manzanillo (Pan). Maersk will brand it 'Amazonia Caribbean Express' (ACX). The move comes 18 months after its decision to terminate its vessel sharing agreement (VSA) with CMA CGM on a comparable service (NCX/Brazex), which had been jointly organized in September 2009 through the merger of the CMA CGM's 'Brazex' with Maersk's 'North Coast Express' (NCX). Page 6 Copyright Alphaliner

7 Maersk to add US Gulf-Central America direct connection Maersk : MAE Service Details Meso America Express Slots on Hapag-Lloyd GCS (from Jan 2014) Houston, Altamira, Vera Cruz, Santo Tomas de Castilla, Puerto Cortes, Puerto Limon, Manzanillo (Pan), Cartagena (Col), Caucedo, San Juan de PR, Cartagena (Col), Manzanillo (Pan), Puerto Limon, Santo Tomas de Castilla, Puerto Cortes, Houston Maersk Line is to add in January a US Gulf-Central America direct connection through slots on the Hapag-Lloyd's 'Gulf Caribbean Service' (GCS), which will be altered with the insertion of a direct northbound Centram-USG leg in addition to the current southbound leg, while continuing to serve Caucedo and Puerto Rico. Maersk will brand the service 'Meso America Express' (MAE). Of note, Maersk has been taking slots on the Caucedo-Puerto Rico-US Gulf leg of the GCS since August this year for Med connectivity purposes. The GCS/MAE will serve Houston, Altamira, Vera Cruz, Santo Tomas de Castilla, Puerto Cortes, Puerto Limon, Manzanillo (Pan), Cartagena (Col), Caucedo, San Juan de PR, Cartagena (Col)*, Manzanillo (Pan) *, Puerto Limon*, Santo Tomas de Castilla*, Puerto Cortes*, Houston (* additional calls inserted in January). A fifth week and fifth ship will be added to the rotation, currently ensured with 2,000 teu tonnage. The MAE will complement Maersk's 'South Atlantic Express' (SAE), which connects the US East Coast to Central America. Separately, Maersk is to replace the Balboa call by a second call at Caucedo on its Panama-Caribbean service, which will henceforth call at Manzanillo (Pan), Caucedo, San Juan de PR, Caucedo, Manzanillo (Pan). CCNI : New Central America Service Details Guatemala/Costa Rica service Slots on CMA CGM/CSAV Manzanillo, Puerto Quetzal, Puerto Caldera, Manzanillo Nicaragua/Honduras service Slots on X-Press/Evergreen Manzanillo, Acajutla, Corinto, San Lorenzo, Puerto Quetzal, Manzanillo CCNI develops Central America coverage CCNI has enhanced its coverage of Central America with the purchase of slots on two services connecting Manzanillo (Mexico) to Guatemala, Costa Rica, Salvador, Nicaragua and Honduras. Guatemala and Costa Rica are served from Manzanillo via slots purchased on CMA CGM' and CSAV's Central America Feeder service (Tikal 1). This weekly operation connects Manzanillo to Puerto Quetzal and Puerto Caldera, using two chartered vessels, the 1,732 teu 'Wenchong 1700' type HS SMETANA, contributed by CSAV, and the 1,730 teu B-170 type JOANNA, contributed by CMA CGM. Salvador, Nicaragua and Honduras are served via slots taken on the joint Mexico Central America service of X-Press Feeders and Evergreen. This weekly operation connects Manzanillo to Acajutla, Corinto, San Lorenzo and Puerto Quetzal, using two vessels, the 966 teu GEORGIA, contributed by Evergreen, and the 877 teu X-PRESS YERUPAJA, provided by X-Press Feeders. Both services connect at Manzanillo with three deep sea services offered by CCNI : The Asia-WCSA North Asia Express Service (NAX), operated by CCNI, Hamburg Sud, Hanjin, CSCL and HMM; The seasonal Asia-WCSA weekly service, operated by CCNI, CMA Page 7 Copyright Alphaliner

8 CGM, MSC, CSAV, Hamburg Sud, Hanjin, CSCL and HMM; The USWC-WCSA West Coast Express Service (WCX) operated by Hamburg Sud, in wich CCNI takes slots. Hartmann to launch second Europe-West Africa service The Hartmann group's presence on the Europe-West Africa trade dates back to May 2013 when the company launched within the frame of HPL a service connecting North Europe and Portugal to Mauritania, Nigeria, Ghana and Ivory Coast using a fleet of four multipurpose vessels ranging from 6,500 to 17,000 dwt. The launch of this new line coincided with the decision of Baco Liner Seereederei to terminate its long standing Europe-West Africa barge-container service, after selling for demolition its last two barge-container carriers, the BACO LINER 1 and BACO LINER 2. The Hartmann service offers a port coverage encompassing several key calls of the former Baco Liner service. Marguisa : Europe-Equatorial Guinea Service Details EGEN Transhipment via Algeciras Hamburg, Rotterdam, Antwerp, Le Havre to Malabo, Bata via Algeciras Marguisa was set up in 1997 to provide liner services between Spain and West Africa, with a special focus on Equatorial Guinea. The Hartmann group (Germany) is to launch a second container and breakbulk service between Europe and West Africa, complementing the service started in May this year. This new service will be operated within the frame of 'Hartmann Project Lines' (HPL) by Duisburg-based Maritime Transport+Logistik (MTL), an affiliate of the Hartmann Group. The new operation is due to kick off in February and is expected to serve Gabon, the Republic of Congo and Angola. The details of the port coverage as well as the fleet to be deployed will only be disclosed early in January but the company says it will use modern geared multipurpose tonnage, likely to include vessels of the Atlantic 'P' class (such as ATLANTIC PROGRESS of 17,400 dwt/1,118 teu) and 'Huanghai MPC 25' class tonnage (such as HAL AMBASSADOR of 25,800 dwt/1,571 teu). Marguisa connects Equatorial Guinea to North Europe Madrid-based operator Marguisa has started this month to connect North Europe to Equatorial Guinea via transhipment at Algeciras, using slots purchased on the North Europe-Algeciras leg of the CKYH- Evergreen Asia-North Europe Loop 6, with transhipment at the Algeciras Total Terminal on the Spanish operator s Spain-West Africa service, which is provided jointly with Turkish operator Arkas Line. Branded EGEN, Marguisa s new service covers the ports of Hamburg, Rotterdam, Antwerp and Le Havre in North Europe, connecting with Malabo and Bata in Equatorial Guinea, via transhipment in Algeciras. The tonnage deployed on the Loop 6 of the CKYH-Evergreen loop consists of vessels of 8,500 to 13,000 teu provided by Hanjin. The vessels deployed on the Marguisa-Arkas Spain-West Africa service consist of the 1,604 teu BERNARD A and MARIO A, provided by Arkas, and the 1,732 teu HANSA MARBURG and HANSA CLOPPEN- BURG provided by Marguisa. The Marguisa-Arkas joint service was organized in October 2013, encompassing a former fortnightly Spain- West Africa service run by Marguisa with only two vessels. Besides Equatorial Guinea, this service also calls at Lagos, Tema and Abidjan, providing sailings every ten days. Marguisa also connects Equatorial Guinea to the Mediterranean with a roro service run jointly with CMA CGM-Delmas, as well as to Asia, via slots taken on the CKYH-Evergreen s Loop 6 and on Evergreen s 'China Europe Service'1 (CES). Page 8 Copyright Alphaliner

9 Borchard Lines to replace own North Europe-Med service by slots UK-based Borchard Lines is to opt for a slot purchase from Seago and Hamburg Süd to replace its long standing North Europe-Eastern Med stand alone service. This choice is dictated by an erosion of freight rates on a trade where it has to compete with ships four or five times larger than the ones Borchard operates. Borchard Lines : North Europe- Med Service Details North Eur-Eastern Med (to be replaced by slots from 2014) 4 x 868 teu Tilbury, Rotterdam, Antwerp, Limassol, Ashdod, Haifa, Alexandria, Izmir, Salerno, Tilbury The Borchard Group of Companies is based in London and is privately-owned by the Borchard family. It has been operating liner services between Northern Europe and the Mediterranean since It currently operates a fleet of 14 containerships including four owned units. Borchard, which is currently using four relatively small ships of 868 teu on this route, is exposed to the competition of large East-West carriers such as Maersk (Seago), MSC, CMA CGM or Hamburg Süd, who have been achieving higher efficiency by deploying 4,000-4,500 teu tonnage on North Europe-Med services as well as using North Europe-Asia VLCS/ULCS wayporting in Med ports. From mid-january, Borchard will offer its 80 years old service through slots on two North Europe-Eastern Med weekly services offered jointly by Seago Line, the A.P. Møller-Maersk (APM-M) intra Europe regional carrier, and Hamburg Süd. Based on the current Borchard ship effective capacity, it would take about 800 teu weekly on these two loops, corresponding to around 10% of their total capacity. For the North Europe to Israel, Cyprus and Egypt trade, Borchard will purchase slots from Seago s weekly North Sea-Eastern Med 'EuroMed service with an allocation covering the ports of Felixstowe, Rotterdam, Antwerp, Haifa, Limassol, Alexandria, Ashdod, Salerno and Felixstowe, the latter port replacing Tilbury, the traditional Borchard UK call. This service is currently operated with five Maersk ships of 4,200 teu, with Hamburg Süd taking slots. For the North Europe to Greece and Turkey trade, Borchard will buy slots on Seago s North Europe-Aegean Sea 'Scan Med' service with an allocation covering the ports of Felixstowe, Antwerp, Piraeus, Izmir (Aliaga), Felixstowe and Rotterdam. This service to which Hamburg Süd also participates as a slot taker is currently operated with four Maersk ships of 4,500 teu. Hamburg Süd maintains separately a weekly NW Europe-Near East (Levant) service to which Seago Line participates as a slot taker and on which Borchard is not involved. Borchard will continue to operate independently the rest of its network, which includes : A weekly Irish Sea-East Med service, currently operated with four 1,216 teu Hanjin 1200 type vessels such as RACHEL BORCHARD A weekly West Med-Bosphorus service, focusing on Turkey, using the 803 teu MIRIAM BORCHARD and the 698 teu KATHERINE BORCHARD Page 9 Copyright Alphaliner

10 A weekly West Med-Near East service, using the 809 teu ANNE BORCHARD and REBECCA BORCHARD A weekly Adriatic-Eastern Med service, using the 672 teu sister vessels DINAH BORCHARD and LOUISE BORCHARD. Swire and Carpenters team up on PNG Swire Shipping/Carpenters Shipping : Asia-PNG Service Details SE Asia-PNG Service 3 x 1,200-1,700 teu Singapore (Jurong), Port Kelang, Phu My, Map Ta Phut, Jakarta, Darwin, Port Moresby, Lae, Kimbe, Honiara, Brisbane, Melbourne, Port Kembla, Newcastle, Brisbane, Gladstone, Townsville, Darwin, Benete Bay, Singapore The China Navigation Company Pte Ltd (CNCo), the deep sea shipping arm of the UK-based Swire Group, and Carpenters Shipping, a subsidiary of MBf Holdings, a publicly listed Malaysian conglomerate, have concluded an operational capacity sharing arrangement on the Asia-Papua New Guinea (PNG) trade through which Carpenters will supply one 1,700 teu vessel (HANSA NORDBURG) into the existing CNCo's SE Asia-PNG service and will get access to other CNCo services covering PNG (CNCo operates these services under the 'Swire Shipping' brand). This arrangement is organized ''in response to the sustained decline in cargo volumes from South East Asia to Papua New Guinea combined with escalating costs'', says Swire. It will be implemented in late December. The existing service frequency and port coverage offered by CNCo- Swire will remain unchanged, while Carpenters will improve its offer through its participation in several Swire services, including direct China-PNG links. Carpenters will therefore offer a total of 64 voyages to PNG per annum instead of the 17 annual voyages it currently offers with its two ship service, employing the chartered 1,078 teu PAC ANTLIA and PAC AQUARIUS. It launched this service in March 2010 with four ships of 900-1,100 teu, reduced to three ships in June 2010 concurrently to a rotation adjustment and to two ships in September Carpenters will then be left with a single operated ship, with this new arrangement with CNCo. Page 10 Copyright Alphaliner

11 DELIVERY UPDATES The SHUNTIEN (mpp) is delivered Cellular Containership Deliveries December 2013 Name Teu Operator EVER LOTUS 8,452 Evergreen CAP CORAL 3,868 Ham Süd HANJIN LOUISIANA 3,600 Hanjin The China Navigation Company Pte Ltd (CNCo), the deep sea shipping arm of the UK-based Swire Group, has received the SHUNTIEN, fifth of eight multipurpose cargo vessels of 31,000 tdw and 2,082 teu ordered in China in October 2010 at Zhejiang Ouhua Shipbuilding. The SHUNTIEN was delivered a few weeks later than planned and is assigned to the company's NE Asia-SE Asia-Australia (APA) multipurpose service, replacing the chartered PINE 3 (34,000 tdw/960 teu). She follows the SHENGKING, delivered in September. Next to come in this series, the SZECHUEN, is expected to join the same service in March These ships have five holds with three of these holds equipped with cells for 40 ft containers, and they are fitted with stoppers (retractable lugs fitted a few meters above the hold floor, to support container stacks above a bulk or breakbulk cargo stowed on the hold floor). The two other holds are the largest ones and are aimed primarily at breakbulk and project cargoes. They are fitted with tweendecks and are accessible through hatches of 31.6 meters in length, allowing the stowing in holds of bulky industrial modules. The deck can accept full container loads of up to 1,166 teu, as well as breakbulk cargoes and large items, depending on the cargo mix on a given voyage. The container capacity can reach 2,082 teu in full container mode, which is a notional intake that is not expected to be reached on the versatile services on which such ships are deployed. The cargo spaces are served by four cranes of 60 tonnes each, which can be combined by pairs to handle items weighing up to 120 tonnes at average crane topping, including the weight of lifting beams. CNCo has returned to Zhejiang Ouhua in March for a new program of up to eight 22,000 dwt multipurpose cargo vessels. Page 11 Copyright Alphaliner

12 NEW ORDER UPDATES Paragon Shipping cancels wide-beam newbuilding Cellular Containership Deliveries By Month * Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb 2013 Jan Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb 2012 Jan Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb 2011 Jan Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb 2010 Jan TEU Delivered Units delivered * Deliveries recorded month-to-date NASDAQ-listed Paragon Shipping, managed by Athens-based Allseas Marine S.A. headed by Michael Bodouroglou, has cancelled one of two 4,777 teu wide beam container vessels it had on order at China's Zhejiang Ouhua Shipbuilding since March 2011 further to the conversion of two bulk carriers orders into containership orders. The company is now left with only one order, due for delivery in the second quarter of 2014, for which the contract price is reduced from the original $57.5 M to $55.0 M. Box Ships Inc., a related listed company, has an option to buy the remaining vessel. Box Ships Inc. is a Greece-based NYSE-listed shipping company specialized in the ownership of container vessels, also managed by Allseas Marine. Box Ships was set up by Paragon in April 2011 to harbour the containerships in which it started to invest. Box Ships currently owns nine containerships : the 6,589 teu MAULE, on charter to CSAV until May 2016, the 5,344 teu sister vessels OOCL CHINA and OOCL HONG KONG on charter to OOCL until spring 2015, the 5,078 teu CMA CGM KINGFISH and CMA CGM MARLIN on charter to CMA CGM until spring 2014, the 5,050 teu MSC EMMA, on charter to MSC until August 2014, the 3,426 teu BOX TRADER on charter to Hapag-Lloyd until April 2014 and the sister vessel BOX VOYAGER on charter to Cheng Lie Navigation Co (CMA CGM) until March 2014, the 4,546 teu BOX QUEEN, open for employment after her recent redelivery by Maersk Line, which operated her as MAERSK DIA- DEMA on a long term charter basis initially concluded between Hermann Wulff and P&O Nedlloyd in April 2004 and transferred to Maersk Line in February 2006 soon after her delivery, in the wake of the P&ON purchase by APM-Maersk in August Hermann Wulff sold her to Box Ships in April 2011, with the charter running at $28,000 per day, three times higher than current market levels. Page 12 Copyright Alphaliner