Annual Report 2012


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INITIATIVESINTHENEWMEDIUM-TERMMANAGEMENTPLANBUSINESSENVIRONMENTOUTLOOKTHEDRYBULKBUSINESSHASGROWNANDEARNINGSHAVEINCREASEDSTEADILYONTHEBASISOFMEDIUM-TERMANDLONG-TERMCONTRACTSWITHREGULARDOMESTICANDOVERSEASCUSTOMERSFORTHETRANSPORTOFIRONANDSTEELRAWMATERIALS,THERMALCOALANDGRAIN.WEWILLCONTINUETOADHERETOTHISBUSINESSAPPROACHANDSEEKFURTHERSTABILIZATIONOFBUSINESSPROFITSBYDEVELOPINGOURRELATIONSHIPSWITHREGULARDOMESTICANDOVERSEASCUSTOMERS.ATTHESAMETIME,WEWILLSEEKADDITIONALBUSINESSEXPANSIONBYACTIVELYRESPONDINGTOINCREASESINTRANSPORTATIONDEMANDINCOUNTRIESWITHDEVELOPINGECONOMIES.ALTHOUGHWEAIMTOREACHAflEETSIZEOF300VESSELSATTHEENDOFfiSCAL2016,THISPRESUPPOSESTHEABILITYTOPLACEORDERSFORSHIPSATFAIRPRICESONTHEPREMISEOFOBTAININGCONTRACTSANDSECURINGSTABLEEARNINGS,ANDOURPOLICYWILLBETOCOMBINEOUROWNflEETWITHCARRIERSONMEDIUM-TERMANDLONG-TERMCHARTERCONTRACTSFROMSHIPOWNERSINJAPANANDOVERSEASWITHWHICHWEHAVECLOSERELATIONSHIPS.VICEPRESIDENTEXECUTIVEOFfiCERTAKASHISAEKIDRYBULKBUSINESSSECURESTABLEEARNINGSTHROUGHEXISTINGCONTRACTSPROMOTECORONASERIESTOOBTAINCONTRACTSWITHGLOBALCUSTOMERSPURSUENEWBUSINESSOPPORTUNITIESINEMERGINGCOUNTRIESMAINTAINSTABLEEARNINGSTHROUGHEXISTINGCONTRACTSPURSUENEWMEDIUM-ANDLONG-TERMCONTRACTSTOEXPANDSOURCESOFSTABLEPROfiTANDEARNINGSCATCHUPGROWINGDEMANDINTHEEMCOUNTRIESPURSUEMOREINBOUNDCARGOESTORAISEEFfiCIENCYOFUSAGEOFVESSELSCATCHUPDEMANDRAISEDFROMEXPANDEDPANAMACANALHEDGEMARKETEXPOSURERISKSBYMID-TERMCONTRACTSANDFREIGHTDERIVATIVESDEMANDFORTRANSPORTINGTHERMALCOALISEXPECTEDTOREMAINSOLIDGLOBALLY.DEMANDFORWOODCHIPSISANTICIPATEDTOINCREASEINCHINA.THERMALCOALCARRIER/WOODCHIPCARRIERDEMANDFORIRONOREANDCOKINGCOALWILLINCREASEFOLLOWINGTHEEXPANSIONOFPRODUCTIONCAPACITYINAUSTRALIAANDBRAZIL.CAPESIZEDEMANDSFORCOAL,GRAIN,FEEDSTUFFAREEXPECTEDTOEXPANDINEMERGINGMARKETSLIKECHINAANDINDIA.THETRADERANGEISALSOEXPECTEDTOEXPANDINMID-&LONGTERMPERSPECTIVE,DUETOTHEEXPANSIONOFTHEPANAMACANAL.PANAMAX/HANDY/SMALLHANDYMARKETOUTLOOKBASICSTRATEGIES20ANNUALREPORT2012BUSINESSREVIEWANDOUTLOOK


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