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U.S. Export ChallengesU.S. Export ChallengesPresented by: Donna Lemm, Director of Global Client Services

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Vessel Capacity Equipment Shortages and

Imbalances Volatility of Export Rates

Top Three Export ChallengesTop Three Export Challenges

3Source: IANA Rail Intermodal Terminal Directory

US Export Capacity CrisisUS Export Capacity Crisis

Equipment Shortage

Equipment Availability

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Import/Export Equipment ImbalanceImport/Export Equipment Imbalance

Source: Brian Conrad - WTSA

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Booking 5-8 weeks forward Bookings cancelled without warning As of fall of 2009, 1.3M TEU’s, or approx 10% of

global world fleet is idle. As of last week, we understand there are carriers

still reducing capacity, with no intention to redeploy until mid-March 2010.

Source: JOC 1/28/09

Vessel Capacity ShortagesVessel Capacity Shortages

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General Rate Increases Accessorial Charges

Volatility in RatesVolatility in Rates

WTSA Avg Revenue Index Through November 2009 (excl bunker)

January, February, & March 2010 Projected Increases

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Strong sales Weak dollar Bottleneck at ports Inland struggle for

equipment

Export Forecast 2010Export Forecast 2010

Asia2010 Q1 1,480,119

Q2 1,526,302Q3 1,493,097Q4 1,565,737

2010 YearEnd 6,065,255% Growth 8.2%

TransPacific Trade: U.S. Container Exports in TEUs

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1,000,000

1,300,000

1,600,000

1,900,000

Q1 Q2 Q3 Q4

US Exports to AsiaUS Exports to Asia

Source: PIERSActual data for 2008 & 2009, Forecast data for 2010

2008 2009 2010 Forecast

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Pricing and contracting Guaranteed pricing for guaranteed space? Penalties for no-show?

Simplification of charges Known exposure Carrier shift in business model to include balanced

trade priorities Continued work by the exporter in terms of

visibility of the supply chain from mill/production to port to destination

Changing Our ParadigmChanging Our Paradigm

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Voice of the US Exporter?Voice of the US Exporter? FMC President’s state of the Union Address

Export Promotion Cabinet – direct report to the President

Government Export Strategy to promote U.S. exports

Support 2 million American jobs Shipping Act of 1984 Sec 2.4 states that one of the purposes of the

act is “to promote the growth and development of United States exports through competitive and efficient ocean transportation and by placing a greater reliance on the marketplace.”

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Will There be Capacity to Carry Will There be Capacity to Carry These U.S. Goods?These U.S. Goods?

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Q & AQ & A

Thank You!Thank You!