1 - Spot Hire Rates Daily spot hire rates will likely decrease next year. The stagnant rate of iron ore and coal imports coupled with the increasing supply of vessels should result in a market surplus, driving the price down as more suppliers compete for limited demand. Based on historical numbers, average daily rates have a direct relationship with the number of shipments. As seen in years '95-'96 and '97-'99, when shipment levels remain stagnant, the average spot rate has a tendency to decrease over time (shown in the table below). This relationship is purely driven by economics. When the rate of shipments, or demand, flattens, suppliers are forced to compete for a finite number of consumers. As competition increases, prices will naturally decrease. Additionally, the age of shipping vessels and trade patterns affect the daily spot rates. Older vessels run less efficiently and therefore can only command a discounted rate when compared to the industry average. If trade patterns change and shipping routes are shortened or extended as a consequence of these changes, th......

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