please print
---------------------- Forwarded by Jeffrey A Shankman/HOU/ECT on 11/07/2000 
12:35 PM ---------------------------
   
	Enron Capital & Trade Resources Corp. - Europe
	
	From:  Chris Connelly                           11/05/2000 11:43 AM
	

To: George McClellan/HOU/ECT@ECT, Stuart Staley/LON/ECT@ECT, Jeffrey A 
Shankman/HOU/ECT@ECT, Mike McConnell/HOU/ECT@ECT, Kevin 
McGowan/Corp/Enron@ENRON, Tom Mcquade/HOU/ECT@ECT
cc: Peter Bradley/LON/ECT@ECT, Jez Peters/LON/ECT@ECT, Candace 
Parker/LON/ECT@ECT, Kenny Nicoll/LON/ECT@ECT, Dimitri Taylor/LON/ECT@ECT, 
Andy James/EU/Enron@Enron, Cornelia Luptowitsch/LON/ECT@ECT 
Subject: Freight weekly report


Enron Shipping Services Weekly report 43/2000




Highlight
The cape market continues to rise almost daily with RBCT to Rotterdam at 
$11.40 and Quennsland to Rotterdam at $15.5 in the spot market.  The driving 
factor has not been coal as of late, but an unexpected rush of Iron Ore 
cargoes.  On the panamax front, rates have been easing for the last few 
weeks, as the expected strong grain activity in the US gulf as not yet 
materialised.  The average time charter rate on capes is now in excess of 
$25,000 daily and close to $11,000 on panamaxes.  The general view in the 
market is that prices for both capes and panamaxes will remain strong though 
to April/May 2001 by which time steel mills will have reduced raw material 
imports and adversely affected cape rates and the shear number of 
newbuildings on the panamax front will drag earnings down as well.  Our group 
tends to believe that the balance of the year will see yet firmer rates but 
we expect a slow down and a decrease in rates to take effect towards the 
first two months of next year as we already are seeing some owners 
desperately seeking to cover themselves for next year at very aggressive 
numbers ( Hadeed contract ) and we are getting the feeling that Bocimar is 
keenly interested to cover their long position even tough their length is 
mainly through March/April next year.  Furthernore, the asian owners seem 
more and more agressive with rates for next year as their countries are 
hitting some rough patches currently, as evidenced by their stock markets and 
strong comments against continued strong crude oil prices.

On the ABC front, it appears as if Zodiac and P&O have agreed in principal to 
a deal by which Zodiac buys 50% of ABC but gets full control of the company.  
Details are still patchy and we are keeping a close eye on the possibility of 
Zodiac putting their newly acquired vessels into the Bocimar pool as that 
would have a drastic bullish effect on rates for some months to come.  We 
have proposed to Bocimar a 5 year collar deal by which we get access to 5 
million tons of freight each year with ability to settle the collar deal 
against an index and have the ability to call upon physical tonnage each 
year.  Furthermore, we would have ability to have a washout clause for each 
year by which we would pay a fix lump sum cash amount.   We have also built 
in several other options and we are waiting for an answer from Bocimar 
sometime next week.  This deal would offer us access to modern vessels at a 
price similar to that of the cape index of the last 10 years and with enough 
built in options to take advantage of any sudden market changes.

On the logistics front, Coeclerici is coming in next week to make a 
presentation on their port handling operations in India/ Indonesia and 
Venezuela with the idea of teaming up with us on forthcoming tenders where we 
would offer the long term coal contracts into or out of certain ports, as the 
case maybe, and they would build and manage the port operations.  They 
currently have some interesting contracts in Indonesian ports which should 
have special interest to us vis a vis CLP.  

Our two cape deals with Coeclerici are still not finalised as we are still 
having a few issues with credit language but expect the deals to close within 
the next 10 days.

On the EOL front, Andy James has been able to get EDFtrading to trade 225,000 
tons of freight via EOL this week and he has added Louis Dreyfus grain and 
Billiton and RWE trading to the list of customers that have trading authority 
on our system.

Regarding the lighter side of business, Enron dry bulk shipping was featured 
in tradewinds, a weekly shipping  newspaper, with 3 pages dedicated to our 
rapid growth and clever insights.


Market
	Short term	Medium term	Long Term
Handy Max	Up	Flat	Flat
Panamax	Flat	Down	Down
Cape Size	Up	Up	Flat


Deals Done
Physical Freight
ECS freight 
Fixed a panamax for early December loading from Puerto Drummond to LBT


Third parties freight deals
Still negotiating a 6 panamax deal with EDF trading from Richards Bay to Le 
Havre for all of next year and looking to sell freight to Preag from KPC to 
Rotterdam for similar period.


OTC 
FFA s
Very active week in which we transacted with Coeclerici on both Capes and 
Panamaxes routes and traded with Jinhui and Conagra on Panaamxes as well.
      
EOL
Traded 225,000 tons with EDF Trading

Travels
All three of us should be in all week