GLG News by EPC Contractors (EU)

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

A.P.Moller-Maersk-B : INTERIM REPORT

August 18, 2011

Analysis of:A.P.Moller-Maersk-B : INTERIM REPORT | www.4-traders.com

The interim results from the worlds largest container operator are of extreme concern.If we are look forward and endeavour to anticipate the future,it appears highly likely that the year end result will disappoint,baseed purely on deteriortating global conditions.This warrants great caution.

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

A.P.Moller-Maersk-B : INTERIM REPORT

August 18, 2011

Analysis of:A.P.Moller-Maersk-B : INTERIM REPORT | www.4-traders.com

The interim results from the worlds largest container operator are of extreme concern.If we are look forward and endeavour to anticipate the future,it appears highly likely that the year end result will disappoint,based purely on deteriortating global conditions.This warrants great caution.

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

Growth fears add to dry bulk shipping woes

August 8, 2011

Analysis of:Growth fears add to dry bulk shipping | www.thestandard.com.hk

Growing fears for the world economy signal more pain and even bankruptcies among dry bulk ship owners who are getting rock-bottom rates to carry cargoes like coal and now face a glut of new vessels ordered when times were good. The tougher climate has hit the sector hard this year and confidence is at a record low. Korea Line, South Korea's debt-stricken second largest dry bulk shipping line, is among the casualties. The firm, under court receivership, has filed a restructuring plan to the court.

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

Noble Energy: Good chance of large gas find off Cyprus

August 8, 2011

Analysis of:Noble Energy Prepares To Explore Block 12 Of Cyprus | www.oilvoice.com

There has been much interest in the exploration and exploitation of gas off Cypurs,especially after the substantial reserves found off the coast of israel.The potential reserves are very substantial although todate,with the exception of Noble Energy,no new concessions have been awarded.The current political turmoil within Cyprus has created much uncertainty at the moment as to how the future development will be managed.Suffice to say,this area is of great strategic interest to the major powerhouses in the world!

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

More shipping lines axe services out of Asia

July 25, 2011

Analysis of:More shipping lines axe services out of Asia | www.ifw-net.com

Capacity is withdrawn as the battle to push up rates on the transpacific steps up a gear- goes the headline on this article.The questions we all have to address are the following:1.What is the real cause of this situation?2.Can these factors be addressed as a matter of urgency?3.If not,how long will it take for balance(normality) to return to the markets?It seems probable that a period of continued uncertainty and instability will continue far longer than most predict.

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

Overcapacity drives maritime industry confidence to its lowest for two years

June 30, 2011

Analysis of:Overcapacity drives maritime industry confidence to its lowest for two years | www.ifw-net.com

It is amazing what short memories people have.Excess liquidity,easy credit fuels huge speculative buiding which owners/investors believe will continue indefinately.However,we do live in a real world where reality will eventually assert itself.Supply and demand is just one major factor in this equasion.A slow down in international trade is another.

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

Container lines' reliability declines alongside freight rates

May 12, 2011

Analysis of:Container lines' reliability declines alongside freight rates | www.ifw-net.com

It was inevitable that something serious would happen with declining freight rates and increased fuel costs.At the end of the day,the carriers will do everything to minimize costs whilst trying to maintain a regular and reliable service.However,when push comes to shove,survival takes priority over serving their clients best intererst,no matter what is stated publically or otherwise.

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

Ship Finance: Where is the Money?

February 9, 2011

By Greg TrauthweinWhile capital for the maritime industry remains tight, lenders insist that funding is available for well- managed public companies. At the 17th Annual Joint Shipping Conference held at the Waldorf Astoria Hotel February 8, 2011 - a conference co-sponsored by the Hellenic-American/Norwegian-American Chambers of Commerce - finance leaders addressed the question of capital availability."There is a flight to quality," said Martin Lunder, SVP, Nordea Bank. "The window is open, but the mesh is really tight."Proof is the value of industry deals through Nordea Bank over the past three years, from $30b in 2008 to $8b in 2009 to $15b in 2010."Existing companies with a track record have the best access today," said Ted Jadick, president & CEO, DnB Nor Markets. "Availability is limited, but it's there for proven entities."Regarding market specific outlooks, Wiley Griffiths, executive director, Morgan Stanley, summarizes: "The tanker market is a very tough market right now; containerships still have some upside; and drybulk is a bit of a wildcard, strong on the demand side but everyone is worried about the orderbook."

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

Capacity growth to reach 8.8% in 2011

January 24, 2011

Analysis of:Container trades collapse 'veering out of control' | www.lloydslist.com

The level of containershipcapacity additions is expectedto reach 8.8% in2011 and 8.6% in 2012• Over-capacity in the containershipmarket is expectedto persist for atleast one more year withdemand expected to slowdown significantly in 2011to below 8% from the estimated13.6% growth in2010.• Volume growth at maincontainer ports in Asia hasslowed in the fourth quarterof last year, with theslower growth rate expectedto continue into2011

Raymond KalleyChairman and Chief Executive OfficerReliance Capital Group

Rising Chinese Inflation to Show Up in U.S. Imports

January 18, 2011

Analysis of:Study finds IGCC plus pre-combustion CCS best option for replacing coal plants | www.powergenworldwide.com

BEIJING — When garment buyers from New York show up next month at China’s annual trade shows to bargain over next autumn’s fashions, many will face sticker shock.“They’re going to go home with 35 percent less product than for the same dollars as last year,” particularly for fur coats and cotton sportswear, said Bennett Model, chief executive of Cassin, a Manhattan-based line of designer clothing. “The consumer will definitely see the price rise.” Inflation has arrived in China. And after Tuesday’s release of crucial financial statistics by China’s central bank, few economists expect Beijing officials to be able to tame rising prices any time soon. While American importers of Chinese goods will feel the squeeze, the effect on American consumers may be more subtle and the overall impact on United States inflation may be minimal. There are simply too many other markups along the way — from transportation to salesclerks’ wages — that affect the American retail prices of Chinese-made products. Excluding those markups, imports from China are equal to little more than 2 percent of the overall American economy. The bigger consumer impact is in China itself. As China’s booming economy enables more of its own citizens to buy the goods pouring out of its factories, Chinese consumers are feeling inflation directly. And Beijing is increasingly worried about the social unrest that could result. In China, consumer prices were 5.1 percent higher in November than a year earlier, according to official government data. And many economists say the official figures actually understate the rate of inflation, which might in reality be twice as high. “Four percent, China can bear it — beyond 5 percent, people will complain a lot,” said Huo Jianguo, president of the Chinese Academy of International Trade and Economic Cooperation here. Higher global commodity prices, as well as rising wages in China, play roles in the increasing cost of Chinese goods. But economists say the main reason for the inflation now is China’s foreign exchange reserves, which surged by a record amount in the fourth quarter. The central bank has been pumping out currency at an ever-accelerating pace over the past decade to limit the renminbi’s appreciation against the dollar. That strategy has helped preserve a competitive advantage of Chinese exporters by keeping their prices relatively low on global markets — while also protecting the jobs of tens of millions of Chinese workers in export factories. Now, though, that cheap currency policy seems to be reaching its limits. The extra renminbi are feeding inflation. That is starting to undermine exporters’ price competitiveness — just as a stronger renminbi would do if Beijing was not intervening to begin with. Money supply figures for December, which the central bank released on Tuesday, showed that cash and bank deposits were increasing at a rate twice as fast as even China’s soaring economy. Ever more renminbi are available to buy goods and services. Victor Fung, the group chairman of Li & Fung in Hong Kong, a 35,000-employee trading company that supplies most of the world’s big retailers with Asian goods, said that contracts signed late last year would produce a jump of 10 to 20 percent in the import prices of consumer goods arriving at American ports by the second quarter of this year. “By the middle of this year, you’ll see considerable diversion of trade away from China,” which will start to bring down the United States trade deficit with China, Mr. Fung said in an interview. But there are only limited alternatives to China as a supplier of cheap goods. As American retail chains scramble to shift orders to other countries like Bangladesh and the Philippines, they are finding that inflation is emerging as an issue across much of Asia. What is more, the far smaller factories in other Asian countries have little capacity to absorb the huge orders that Chinese factories routinely handle, corporate executives and economists said. In China, there is little question that the consumer price index understates the true extent of inflation.A holdover from the days of central planning, the Chinese consumer price index includes apartment rents but excludes soaring costs for owner-occupied housing. And it is based heavily on the prices of an outdated list of consumer products that are no longer popular. Garments qualify for inclusion only once they have been on sale continuously for at least six months, for example, which frequently means that they are no longer in style.Hu Xingdou, an economist at the Beijing Institute of Technology, said that a more accurate gauge of inflation would show consumer prices rising 10 percent a year. The National Bureau of Statistics has said it is actively studying ways to improve the consumer price index. Inflation in China is not just the result of China’s currency market intervention, although Mr. Hu and other economists describe it as the biggest single cause. Another cause is aggressive lending by Chinese banks, despite repeated demands by regulators to slow things down. Rising prices for exports are also caused by wage increases for Chinese blue-collar workers, whose pay has been climbing as much as 15 percent a year. Those workers have more clout than they once did because the supply of factory labor from rural areas, which once seemed inexhaustible, is starting to dry up — a result of three decades of China’s “one child” policy of family planning, as well as a big expansion in university enrollment. And globally, strong demand from consumers in China and other emerging economies is pushing up not only gasoline prices, but also the prices of cashmere, rabbit fur, cotton, copper and many other commodities. Candy Chen, the sales manager of the Zhenjiang Weishun Toys Company in Zhenjiang, China, said that the cost of plastic stuffing for the company’s toy animals had nearly doubled in the past year, while wages were up 10 to 15 percent. The effect of higher prices in China on broad measures of American inflation is far from clear. The rule of thumb for many consumer products, from shoes to garments to toys, is that the import price is only a quarter to two-fifths of the final retail price, which also includes transportation within the United States and the wages, rent, electricity bills and other costs incurred by stores. After showing little change for nearly two years, import prices for goods arriving from China at American docks rose from September to November at a rate equivalent to an annual rise of 3.6 percent. In another indicator that the Chinese central bank released Tuesday, China’s foreign reserves leaped by $199 billion in the fourth quarter. The increase was much larger than economists had expected, and they suggested that China had roughly doubled its intervention in currency markets to around $2 billion a day. China’s reserves, at $2.85 trillion, dwarf those of the world’s second-largest holder, Japan, with $1.04 trillion. The United States, by contrast, holds only $46.4 billion of foreign reserves because it prints dollars, the main reserve currency. Mr. Model of Cassin, who is visiting Beijing this week from his company headquarters just off Seventh Avenue, said that the world had changed and that Chinese manufacturers were now more interested in catering to their domestic market than in offering rock-bottom prices to big American companies. “All of a sudden, they’re more interested in selling domestically,” he said. “The American wholesaler will fight them on $5. The domestic retailer doesn’t care as much.”

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