This document discusses trends in the coal market including increased global coal plant capacity, particularly in Asia. It notes 301,000 MW of new thermal coal plants are under construction globally, with 275,000 MW in Asia. Specifically in China, it highlights increasing domestic coal production and imports to fuel growing demand from power generation and industrial activity. It also covers developments in the Indian coal market like recovering demand and low stockpile levels driving higher imports in the short term.

1. Grains

2. 2
0
20,000
40,000
60,000
80,000
100,000
120,000
140,000
160,000
Exabytes
Annual Data Creation
Increased Fuel Prices
0
20
40
60
80
100
120
140
2011 2013 2015 2017
Brent ($/barrel)
Coal
20
40
60
80
100
120
140
160
2011 2012 2013 2014 2015 2016 2017 2018
Coal Price ($/ton)
Digitization

3. ►2020:
Implementation of new IMO global
sulphur cap on vessel fuels
HISTORICAL PRICE DIFFERENCE. HEAVY FUEL OIL VS. GASOIL
New environmental regulations are likely to considerably increase
fuel costs for freight…
►2020-2025:
Likely additional global CO2 tax on
vessel fuels
0
200
400
600
800
1000
Jan-13 Oct-13 Jun-14 Feb-15 Oct-15 Jun-16 Mar-17 Nov-17
FO 380 CST [USD/MT] Marine Gasoil USD/MT]
 150 – 200 USD / mts premium in current market
 300 USD / mts premium in higher oil markets.

4. 0
5
10
15
20
25
2014 2015 2016 2017
… and lead to a considerable increase in freight costs irrespective of the
state of the dry bulk market
Basis historical fuel prices
+ USD 250 /mts fuel prices
+ USD 500 / mts fuel prices
[USD / mts]
Freight estimations basis ECSA/ Med with standard grain cargo. Using historical P4TC levels and bunker prices.

5. 6
184,193
43,418
27,112 12,963 15,359
6,885
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
China India SE Asia non-EU Europe Africa and
Middle East
East Asia South Asia EU28 Eurasia Latin America Canada/US
Global Coal Fleet expansion plans (MW)
construction permitted pre-permit announced
Source: Klaveness Research/ Global Coal Plant Tracker
301,000 MW of thermal plants under construction globally…
…Whereof 275,000 MW in Asia!

6. 0
200
400
600
800
1000
1200
1400
1600
1800
2000
2009 2010 2011 2012 2013 2014 2015 2016 2017
14 2 7 13 11 6 88
633
1798
Source: Klaveness, Meltwater

9. Oslo Venture (9693185)
Built: 2015 - Dwt: 63.234
Choose your preferences:
Market Exposure
Period
Option period
Revenue sharing
(Expected) TC Rate: $/d 11.980
Short Fixed Floating Double
60d 3yrs9 mths
3 mths60d 3yrs
-100% 100% 200%
9,000
11,000
13,000 Jan-18
Feb-18
Mar-18
Apr-18
May-18
Jun-18
Jul-18
Aug-18
Sep-18
Oct-18
Nov-18
Dec-18
Jan-19
Feb-19
Mar-19
Apr-19
May-19
Jun-19
Jul-19
Aug-19
Sep-19
Oct-19
Vessel Forward Rate

11. Source:Klaveness Research
Cal 17 = 6,000 Cal 18 = 6,900
Cal 19 = 8,100
Cal 17 = 9,800
Cal 18 = 13,000
Cal 19 = 12,400
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
Jan-15 Apr-15 Jul-15 Oct-15 Jan-16 Apr-16 Jul-16 Oct-16 Jan-17 Apr-17 Jul-17 Oct-17 Jan-18 Apr-18 Jul-18 Oct-18 Jan-19 Apr-19 Jul-19 Oct-19
P4TC P4TC F-Curve 06.12.16 P4TC Actual P4TC F-Curve 05.12.2017

12. Iron Ore

13. 15Source:Klaveness Research/Clarksons
Iron Ore
1,474Mt
29%
Coking Coal
256Mt
5%
Thermal Coal
976Mt
19%
Grains
687Mt
14%
Minor Bulks
1,701Mt
33%
2017 Seaborne Volumes Estimate
+7%
+13%
+2%
+4%
+4%
400
600
800
1,000
1,200
1,400
1,600
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Milliontonnes
Global Seaborne Iron Ore Trade

14. 16
Klaveness Research/Clarksons
30%
35%
40%
45%
50%
55%
60%
65%
70%
75%
80%
0
200
400
600
800
1,000
1,200
1,400
1,600
2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Milliontonnes
Global Seaborne Iron Ore imports
China ROW China Market Share>>
Source:Klaveness Research/Clarksons/Worldsteel
China
50%
Japan
6%SouthKorea
4%
India
6%
Europe
12%
NorthAmerica
7%
C.I.S.
6%
SouthAmerica
3%
Other
6%
2017 Steel Production

15. 17
…39% of Chinese steel production is directly linked to infrastructure/transport…30% to real estate
Source:JP Morgan, Wood Mackenzie/Klaveness Research
Infrastructure
&
Transport
39%
Realestate
30%
Machinery
20%
Other
9%
Household
appliances
2%
China Steel Demand by end use - 2016
China used more concrete in 2011-2013
Source: Gatesnotes, USGS, Cement Statistics, Mineral Industry of China 1990-2013/forbes
than the U.S. did in the entire 20th century!...
…investments in real estate is slowing, while infrastructure investments remain high…
Concrete consumption
Source:NBS China/Klaveness Research
-5%
0%
5%
10%
15%
20%
25%
30%
2013 2014 2015 2016 2017
3mmaYoYGrowth
FAI China
Total Real Estate Infrastructure/Transport

16. 18
Source: Klaveness Research
… China’s real steel consumption is growing twice as fast…
45
50
55
60
65
70
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Milliontonnes
China “Real” Steel Consumption
Range 13-16 2015 2016 2017
50
55
60
65
70
75
80
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Milliontonnes
China Steel Production
Range 11-16 2015 2016 2017
Source: NBS China/Klaveness Research
*Based on NBS production statistics for official steel mills. The growth is artificially high as official mills are raising output as a response to
the shutdown of illegal mills (mainly induction furnaces) who was never included in the statistics. The base from previous years is thus to
low.
**Based onNBS production statistics for official steel mills. The growth in production is artificially high as official mills are raising output
as a response to the shutdown of illegal mills (mainly induction furnaces) who was never included in the statistics. The base from
previous years is thus to low. In order to calculate the «Real» steel consumption, production is adjusted with net exports and changes in
inventories (based on available data)

17. 19
40
60
80
100
120
140
160
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
ThousandSquareMeter3mma
House starts
Range 2010-16 2015 2016 2017
Source: NBS China/Klaveness Research Source: NBS China/Klaveness Research
…the growth in house starts has slowed recently…
40
60
80
100
120
140
160
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
ThousandSquareMeter3mma
China: Floor Space of houses sold (3mma)
Range 2010-16 2015 2016 2017

18. 20
0
2
4
6
8
10
12
14
16
Jul-11 Jul-12 Jul-13 Jul-14 Jul-15 Jul-16 Jul-17
Millionsquaremeterinsamplecities
Inventory of unsold houses China
Tier 1 Tier 2 Tier 3
Source: China Index Academy/Klaveness Research
…the growth in Tier 1 house prices has moderated… similar to 3 years ago…
-10%
-5%
0%
5%
10%
15%
20%
25%
Jul-11 Jul-12 Jul-13 Jul-14 Jul-15 Jul-16 Jul-17
China House Prices (YoY)
Tier 1 Tier 2 Tier 3
Source: China Index Academy/Klaveness Research
-46%

19. 21
…Chinese seaborne iron ore import was up 5% in 2017
Source: GTT/Klaveness Research
2017
+53Mt
+5%
50
60
70
80
90
100
110
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Milliontonnes
Chinese Seaborne Iron Ore Imports
12-16 Range 2015 2016 2017

20. 22
…but it is not all about China… Ex-China production has been strong in 2017 …
Source: NBS China/Klaveness Research
YTD + 40Mt
+ 5%
60
62
64
66
68
70
72
74
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Mt
Word Ex. China Steel Production
Range 13-16 2015 2016 2017
1
3
5
7
9
11
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Mt
China Net Steel Export
Range 11-16 2015 2016 2017
…partly driven by lower Chinese Steel export…

21. 23
Source:Klaveness Research/National PMI data
-600
-400
-200
0
200
400
600
800
49.5
50.5
51.5
52.5
53.5
54.5
55.5
Global Industrial Production Growth Proxy*
<<3mma GIP Proxy 3mma YOY BDI>>
*Based on PMI’s for countries representing 84% of global industrial production.
China
U.S.
EZ
Japan
U.K.
Russia
Brazil
S-Korea India
Indonesia
Mexico
Canada
Turkey
Australia
Taiwan
Malaysia
South Africa
-10
0
10
36 50 64
YoYChangeinPMI
PMI
YoY Change in PMI

22. Coal

23. 25Source:Klaveness Research/GTT
-6.2 %
1.8 %
6.1 %
-10%
-5%
0%
5%
10%
15%
0
200
400
600
800
1,000
1,200
1,400
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Millions
Global coal imports
China India Stable Asia Emerging Asia
UK EU (ex UK) Other Atlantic YoY Growth %
Iron Ore
1,474Mt
29%
Coking Coal
256Mt
5%
Thermal Coal
976Mt
19%
Grains
687Mt
14%
Minor Bulks
1,701Mt
33%
2017 Seaborne Volumes Estimate

24. 26Source:Klaveness Research/GTT
25
14 14
3
0 0
-9
-15
-10
-5
0
5
10
15
20
25
30
China Stable Asia Emerging
Asia
EU UK Other
Atlantic
India
Milliontonnes
FH-2017 vs FH-2016 by region
13
7
5
3
1
0
-3-4
-2
0
2
4
6
8
10
12
14
16
India Other
Atlantic
Stable Asia Emerging
Asia
China UK EU
Milliontonnes
SH-2017 vs SH-2016 by region

25. 27
Source:Klaveness Research/GTT/NBS
China short term:
..coal inventories are at low levels…underlying demand remains firm…
10
15
20
25
30
35
40
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Daysworth(7dma)
Coal inventories at 6 major power plants
Range 14-17 2016 2017 2018
2017
+12%
+26Mt
10
15
20
25
30
35
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Milliontonnes
China Seaborne Coal Imports
Range 2012-2016 2015 2016 2017
.. the level of imports in 2018 will to a large extent be policy driven…

26. 28
Source:Klaveness Research/GTT/CEA
the Indian economy is recovering from the negative impact of demonetization…
…and coal stocks are at a critical low level
14
16
18
20
22
24
26
28
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Indian Cement Production
Range 12-16 2015 2016 2017
5
10
15
20
25
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Range 12-16 2015 2016
2017 2017 Estimate
India: Coal Imports
Update
…which has led to strong imports in SH-2017…
30
40
50
60
70
80
90
100
110
Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec
Indian Total Stocks Mines and
Powerplants (Mt)
Range 14-17 2016 2017 2018

27. 29
184,193
43,418
27,112 12,963 15,359
6,885
0
50,000
100,000
150,000
200,000
250,000
300,000
350,000
China India SE Asia non-EU Europe Africa and
Middle East
East Asia South Asia EU28 Eurasia Latin America Canada/US
Global Coal Fleet expansion plans (MW)
construction permitted pre-permit announced
Source: Klaveness Research/ Global Coal Plant Tracker
301,000 MW of thermal coal plants under construction globally…
…Whereof 275,000 MW in Asia!

28. 30
Source:Klaveness Research/Global Coal Plant Tracker /NBS/GTT
6.3 %
0%
1%
2%
3%
4%
5%
6%
7%
0
0.5
1
1.5
2
2.5
3
3.5
4
4.5
5
20042005200620072008200920102011201220132014201520162017
Billiontonnes
China coal import vs. production
China Coal Production China Seaborne Coal Import
Imports (% of Consumption)
184,193
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
China - Thermal Coal Fleet (MW)
Plants built <2010 Plants Built 2010-2017 Under construction
Permitted Pre-permit dev Announced

29. 31
Source:Klaveness Research/Global Coal Plant Tracker/CEA
…the question is to what extent domestic coal production can keep up with the demand growth…
-10%
-5%
0%
5%
10%
15%
20%
Jan-14
Apr-14
Jul-14
Oct-14
Jan-15
Apr-15
Jul-15
Oct-15
Jan-16
Apr-16
Jul-16
Oct-16
Jan-17
Apr-17
Jul-17
Oct-17
3mma(YoYGrowth)
Indian Coal Output vs Thermal Generation
Raw Coal Output Growth Thermal Generation Growth
43,418
0
50,000
100,000
150,000
200,000
250,000
300,000
India - Thermal Coal Fleet (MW)
Plants built <2010 Plants Built 2010-2017 Under construction

30. 32
Source: Klaveness Research/GTT/ Global Coal Plant Tracker
…as new thermal coal plants comes on stream…
11,385
4,446
3,630
3,600
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
South East Asia - Thermal Coal Fleet (MW)
Plants built <2010 Plants Built 2010-2017 Under construction
Permitted Pre-permit dev Announced
25 447 MW under construction
0
10
20
30
40
50
60
70
80
90
100
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Milliontonnes
South East Asia Imports
Malaysia Thailand Philippines Pakistan Viet-Nam Bangladesh Cambodia

31. 33
Source: Klaveness Research/GTT/Global Coal Plant Tracker
…on the back of new thermal coal plants coming on stream…
5,313
6,846
2,400
0
10,000
20,000
30,000
40,000
50,000
60,000
70,000
Japan South Korea Taiwan
East Asia - Thermal Coal Fleet (MW)
Plants built <2010 Plants Built 2010-2017 Under construction
Permitted Pre-permit dev Announced
14 559 MW under construction
0
50
100
150
200
250
300
350
400
2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017
Milliontonnes
East Asia Coal Imports
Japan Korea (Rep. of) Taiwan

33. 35
Source:Klaveness Research/USDA/Clarksons
465 463
531
555
583
607
624
0
100
200
300
400
500
600
700
11/12 12/13 13/14 14/15 15/16 16/17 17/18
Milliontonnes
Global Grain/Oilseed trade
Wheat Coarse Grains Major Oilseeds Major Protein Meals
Iron Ore
1,474Mt
29%
Coking Coal
256Mt
5%
Thermal Coal
976Mt
19%Grains
687Mt
14%
Minor Bulks
1,701Mt
33%
2017 Seaborne Volumes Estimate

34. 36
Source:Klaveness Research/USDA/Clarksons
…ECSA is expected to have a massive growth in exports this year…
…more than offsetting lower export from Australia and the U.S….
198 191 218
194 210
204
103
116
121
48
38
3624
35
27
465 463
531
555
583
607 624
0
100
200
300
400
500
600
700
11/12 12/13 13/14 14/15 15/16 16/17 17/18
Milliontonnes
Export per region
ROW
Australia
EU
MED/BS
North/Central America
ECSA

35. 37

36. 38
Source:Klaveness Research/GTT
…expected to grow in line with global industrial production ….
48
49
50
51
52
53
54
55
56
3mma
Global Industrial Production Growth Proxy
Iron Ore
1,474Mt
29%
Coking Coal
256Mt
5%
Thermal Coal
976Mt
19%
Grains
687Mt
14%
Minor Bulks
1,701Mt
33%
2017 Seaborne Volumes Estimate

37. 39
Source:Klaveness Research/GTT
0
1
2
3
4
5
6
7
8
Jan-13 Jan-14 Jan-15 Jan-16 Jan-17
Milliontonnes
Chinese nickel ore imports
Indonesia Philippines Other
… the ton mile from the Bauxite and Alumina trade continues to rise
0
10
20
30
40
50
60
Jan-13 Jan-14 Jan-15 Jan-16 Jan-17
Billiontonmiles
China Bauxite+Alumina Import
Indonesia Atlantic Australia India Malaysia Other Pacific

38. 40

39. 41
38
24 22
-15 -9
-18
10
17.0 %
5.7 %
2.2 %
2.9 % 1.8 %
1.7 %
-10%
-5%
0%
5%
10%
15%
20%
(60)
(40)
(20)
-
20
40
60
80
100
120
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Mdwt
Deliveries Scrapping Additions/Removals New Contracts YoY growth

40. 42
15
12 13
-6 -4
-8
4
23%
5%
1.9 %
2.8 %
2.5 %
2.7 %
-10%
-5%
0%
5%
10%
15%
20%
25%
(20)
(10)
-
10
20
30
40
50
60
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Mdwt
Deliveries Scrapping Additions/Removals New Contracts YoY growth

41. 43
9
5
6
-3 -2
-4
3
12%
9%
1.5 %
0.5 % 2.8 %
1.3 %
2.0 %
-5%
-3%
-1%
1%
3%
5%
7%
9%
11%
13%
15%
(10)
(5)
-
5
10
15
20
25
30
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Mdwt
Deliveries Scrapping Additions/Removals New Contracts Year End growth

42. 44
13 11
5
3
-4 -3
-2
-4
2
20%
4.9 %
4.0 %
1.4 %
0.2 %
-10%
-5%
0%
5%
10%
15%
20%
25%
(10)
(5)
-
5
10
15
20
25
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019
Mdwt
Deliveries Scrapping Additions/Removals New Contracts Year End growth

43. 45
Source:Klaveness Research/GTT
Effective supply growth dependant on speed
- Optimal speed dependant on bunker price and earnings
- The speed of the fleet should increase at higher earnings
11,4 knots
Speed increase
at 5k
Full Speed at 9k
Speed Increase
at 11.5k
Full Speed at 20k
6
7
8
9
10
11
12
13
14
15
3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
Ladenspeed(knots)Panamax
Panamax Earnings K$/day
Optimal speed with different bunker prices
Current Speed SPO 380 = 164$/ton
18% Supply
increase