Robert Gerald Buchanan - Principal Executive Officer and President John C. Wobensmith - Chief Financial Officer, Principal Accounting Officer, Secretary and Treasurer Peter C.

Georgiopoulos - Chairman

Douglas J. Mavrinac - Jefferies & Company, Inc., Research Division Erik Nikolai Stavseth - Arctic Securities ASA, Research Division Joshua Katzeff - Deutsche Bank AG, Research Division Michael Webber - Deutsche Bank AG, Research Division

Good morning. Before we begin our presentation, I note that in this conference call, we will be making certain forward-looking statements pursuant to the Safe Harbor provisions of the Private Securities Litigation Reform Act of 1995.

Such forward-looking statements use words such as anticipate, budget, estimate, project, expect, intend, plan, believe and other words and terms of similar meaning in connection with the discussion of future -- of potential future events, circumstances or future operating and financial performance. These forward-looking statements are based on management's current expectations and observations.

For a discussion of factors that could cause results to differ, please see the company's press release that was issued yesterday, the materials relating to this call posted on the company's website, and the company's filings with the Securities and Exchange Commission, including without limitation, the company's annual report on Form 10-K for the year ended December 31, 2011, and the company's subsequent reports filed with the SEC. At this time, I would like to introduce Gerry Buchanan, the President of Genco Shipping & Trading.

Good morning, and welcome to Genco's third quarter 2012 Conference Call. With me today is Peter Georgiopoulos, our Chairman; and John Wobensmith, our Chief Financial Officer.

I will begin today's call by discussing our third quarter highlights as outlined in Slide 3 of the presentation. I will then turn the call over to John to review our financial results for the 3-month period ended September 30, 2012.

Following this, I will discuss the industry current fundamentals. John, Peter and I will then be happy to take your questions.

During the third quarter, Genco increased its financial flexibility while maintaining an opportunistic time charter approach in a challenging drybulk market. Turning to Slide 5, Genco recorded a net loss of $38.4 million or $0.90 basic and diluted loss per share for the 3 months ended September 30, 2012.

Genco's cash position, excluding Baltic Trading Limited, was $94.7 million, which reflects the cash flows generated by our large high-quality fleet. During the third quarter, we drew upon our strong banking relationships and increased our financial flexibility by amending each of our 3 credit facilities, which John will discuss in more detail later in the call.

We also maintained our focus on signing vessels to short-term contracts with multinational companies while preserving the ability to take advantage of future rate increases. Consistent with this objective, we have employed several vessels on spot market-related contracts that provide Genco with an option to convert the fixed-rate time charters when market conditions improve.

Moving to Slide 6. We provide a summary of our fleet.

Genco's diversified approach of operating a modern fleet across the entire bulk -- drybulk sector strengthens the company's ability to deliver first-rate service to leading international charters and take advantage of the long-term demand for essential commodities in China, India and other developing countries. Excluding Baltic Trading's fleet, we currently own a fleet of 53 drybulk vessels, consisting of 9 Capesize, 8 Panamax, 17 Supramax, 6 Handymax and 13 Handysize vessels, with a total carrying capacity of approximately 3,810,000 deadweight tons.

Importantly, the average age of our fleet is 7.5 years, well below the industry average of approximately 10 years. I'll now turn the call over to John.

Thank you, Gerry. Turning to Slide 8, I will begin by providing an overview of our financial results for the third quarter and 9 months ended September 30, 2012.

Please note that we're reporting our financials on a consolidated basis as a result of our 25.09% equity ownership in Baltic Trading Limited. For the 3- and 9-month period ended September 30, 2012, we recorded total revenues of $54.4 million and $177.2 million, respectively.

This compares with revenues for the third quarter of 2011 and 9 months ended September 30, 2011 of $94.3 million and $295.1 million, respectively. The decrease in total revenues for the third quarter of 2012 compared to the prior-year period is primarily due to lower charter rates achieved by the majority of our vessels, as well as a higher number of days that our vessels were off-planned off hire to complete drydockings during the third quarter of 2012 compared to the same period the prior year.

This was partially offset by the slight increase in the size of our fleet. The operating loss for the third quarter and 9-month period ended September 30, 2012, was $20.2 million and $43.1 million, respectively.

This compares with the operating income for the third quarter and 9-month period ended September 30, 2011, of $23.3 million and $88.7 million, respectively. The operating loss for the 3- and 9-month periods ended September 30, 2012, is attributable to higher expenses associated with the operation of a larger fleet and lower rates achieved for our fleet compared to the corresponding year earlier periods.

Interest expense for the third quarter of 2012 was $21.5 million and $65.2 million for the 9-month period ended September 30, 2012. This compares to interest expense of $21.8 million for the third quarter of 2011, and $64.7 million for the 9-month period ended September 30, 2011.

The company recorded a net loss for the third quarter of 2012 of $38.4 million or $0.90 basic and diluted loss per share. The net loss attributable to Genco for the 9 months ended September 30, 2012, was $99.3 million or $2.40 basic and diluted loss per share.

This compares to net income attributable to Genco of $1.6 million or $0.04 basic and diluted earnings per share for the third quarter of 2011 and net income attributable to Genco of $25.1 million or $0.71 basic and diluted earnings per share for the 9-month period ended September 30, 2011. For the 3- and 9-month period ended September 30, 2012, Genco also recorded income tax expense of $303,000 and $918,000, respectively.

This compares income tax expense for the third quarter and 9 month period ended September 30, 2011, of $328,000 and $1 million, respectively. This income tax expense includes federal, state and local income taxes on net income earned by Genco Management USA Limited, one of our wholly-owned subsidiaries, and relates to income generated from the technical and commercial management of vessels for Baltic Trading Limited, sale purchase fees payable to us by Baltic Trading Limited, if any, and service revenue from the technical management of vessels owned by Maritime Equity Partners.

Next on Slide 9. You will see the income statement effects of Baltic Trading's consolidation with Genco Shipping & Trading Limited.

This will provide you with a more detailed breakdown of the financial performance of the 2 separate companies. Key consolidated balance sheet and other items as presented in Slide 10 includes the following.

Our cash position including restricted cash was $97.9 million as of September 30, 2012, enhancing our ability to operate in a soft rate environment. Excluding the consolidation of Baltic Trading, Genco's cash position was $94.7 million.

Our total assets as of September 30, 2012, were $2.9 million -- $2.9 billion, consisting primarily of our current fleet, cash and cash equivalents. Our EBITDA for the 3 months ended September 30, 2012, was $18.4 million.

Moving to Slide 11. Our utilization rate was 99.2% for the third quarter of 2012, compared to 99.3% in the year earlier period.

Our time charter equivalent for the third quarter of 2012 was $9,119 per day. This compares to $16,447 per day recorded in the third quarter of 2011.

The decrease in TCE rates resulted from lower charter rates achieved in the third quarter of 2012 versus the same period last year for the majority of the vessels in our fleet. For the third quarter of 2012, our daily vessel operating expenses were $4,956 per vessel per day versus $4,673 per vessel per day for the third quarter of 2011.

Daily vessel operating expenses for the 9 months ended September 30, 2012, were $5,040 per vessel per day versus $4,706 per vessel per day for the 9 months ended September 30, 2011. The increase in daily vessel operating expenses for the third quarter of 2012 compared with the prior-year period is primarily due to higher expenses related to crewing and maintenance.

We note that our third quarter of 2012 daily vessel operating expenses is below our budget set forth at the beginning of the year. As we have stated in the past, we believe daily vessel operating expenses are best measured for comparative purposes over a 12-month period in order to take into account all the expenses that each vessel in our fleet will incur over a full year of operation.

Based on estimates provided by our technical managers and management's expectations, our daily vessel operating expense budget for the fourth quarter of 2012 is $5,200 per vessel per day on an average weighted basis for the 53 vessels in our fleet, excluding vessels owned by Baltic Trading Limited. As previously announced, during the third quarter, we entered into agreements to amend our 2007 credit facility, our $253 million term loan facility and our $100 million term loan facility.

Specifically, Genco's scheduled amortization payments have been eliminated through and including the quarter ended December 31, 2013. As a result, the company's next scheduled amortization payments under its 3 credit facilities will be due in the first quarter of 2014.

On Slide 12, we present our anticipated expense levels for the fourth quarter of 2012. We expect our daily vessel operating expenses for the fourth quarter of 2012 to be $5,200 per vessel per day, our daily free cash flow expense rate to be $10,504 and our daily net income expense rate for Genco consolidated to be $16,960.

I will now turn the call back to Gerry.

Thank you, John. I will now take this opportunity to spend a few moments discussing the industry fundamentals.

I'll start with Slide 14 which points to the drybulk indices. Represented on this slide is the overall Baltic Dry Index.

During the third quarter of 2012, the BDI showed relative weakness driven by increased vessel supply as well as negative sentiment on the rate of growth in emerging economies. The index reached a quarterly low of 661 on September 12.

But this has since rebounded to 1,026, primarily due to the iron ore restocking in China and a considerably reduced rate of vessel deliveries in the second half of the year. On Slide 15, we summarize recent developments in the drybulk freight market beginning with the supply side of the equation.

As a result of continued lower rates and an attempt to combat excess tonnage, scrapping has been on a record pace, increasing by 31% for the 9 months of September at 2012 as compared to the same period of last year. Although the majority of the vessels scraps have been Handysize and Supramax due to the older age of those fleets, we have also observed younger vessel demolitions especially in the Capesize sector.

We highlight that 27 of the 64 Capesize vessels scrapped year-to-date were built from 1990 to 1995. We believe this trend to prove crucial to our quicker recovery in the Capesize sector as 16% of the Capesize fleet was built in 1995 or earlier.

The depressed rate environment has also kept new vessel orders to a minimum, pushing the order book to its lowest level in 8 years, currently, at 22% of the fleet. Existing order deliveries peaked in June of this year and have since considerably slowed down resulting in marginal net additions to the tune of less than 2% for the third quarter.

On the demand side, Chinese iron ore imports continued to grow, registering an 8.6% increase for the 9 months to September. Iron ore imports may continue at healthy levels for the remainder of the year as stockpiles have decreased to the lowest point since July 2011.

And the Chinese government continues to stimulate the domestic economy evidenced by their recent approval of 60 infrastructure projects totaling over $150 billion in September. Chinese steel makers are now reentering the market leading to increased iron ore fixtures on the level of support for the Capesize sector.

The displacement of Chinese ore by imported ore continues to positively affect the drybulk market as evidenced by a September rebound in iron ore exports from Brazil, augmenting ton miles. This trend may continue going forward as iron ore prices have been trading in the $100 to $120 per ton range, making it harder for domestic suppliers to compete.

The Metallurgical Mines Association of China estimates that 42% of Chinese ore production is unprofitable at prices less than $100 per ton and reported that 40% of the iron ore mines suspended operations in September due to their inability to remain profitable at lower observed prices. On the coal front, Chinese imports of the commodity were hampered by an increase in hydropower production in the third quarter as there were several tropical storms that occurred during that period.

Chinese coal fixtures have, however, picked up again and in October, stockpiles at China's largest coal port, Qinhuangdao, have come under pressure due to the scheduled maintenance of the Daqin Railway. Turning to Slide 16.

We believe that a number of short- and long-term catalysts will improve the drybulk market. China's 12th 5-year plan remains a long-term catalyst due to its related infrastructure programs, as well as the organization and development of the central and western regions.

With the upcoming change in government leadership in November, it remains to be seen whether additional stimulus measures will be instituted. Seaborne trade may also be positively affected by planned volume expansion as iron ore miners plan to increase production and invest into higher-capacity core facilities over the next few years.

Higher imported volumes could further induce a price arbitrage between domestic and imported iron ore prices thereby enhancing ton miles in the long run. On the supply side, as volatility in charter rates continues and scrap steel prices remain at high levels, we expect to continue to see increased scrapping of vessels.

The year-to-date period has already registered a record 28.4 million tons of scrap. On Slide 17, we talk more about the demand side fundamentals.

Chinese steel production increased approximately 2% during the first 9 months of the year as compared to 2011 while urban fixed asset investment rose by 24.5%. As China's urban population continues to expand in the years to come, steel consumption is expected to be even greater as the Chinese urban household has a 10 to 15x higher steel intensity than a rural household.

In line with urbanization, China's Ministry of Railways increased 2012 planned infrastructure spending to CNY 516 billion or $83 billion from CNY 496 billion in October. While the Ministry of Transportation is working towards expanding its network of high-speed railways to total over 11,000 miles by 2015 from just over 4,000 miles at the start of this year.

In regards to housing, China's Ministry of Land and Resources plans to build 36 million units of affordable housing by the end of 2015. This year's affordable housing construction target has been increased by 2 million units to 7 million units which is expected to meet as 4.8 million units have been completed through September.

India's growth potential going forward bodes well for the drybulk market also. Steel production in India has grown 5.6% year-to-date and is expected to grow an additional 5% in 2013, according to the World Steel Association.

A growing steel demand and limited iron ore export availability from India is also forcing Chinese steel mills to source imported ore from longer ton-mile origins. Moving to Slide 18.

On the left of the page, we show the expansion plans of key iron ore producers as recently revised by the respective companies. The combined iron ore expansion plans through 2016 accumulate to 426 million tons per annum or 41% of the 2011 seaboarne iron ore trade.

Iron ore production from the world's 4 largest mining companies, Vale, Rio Tinto, BHP Billiton and Fortescue, increased 5% through the first 9 months of 2012 compared to the same period of prior year. Production from Australian miner for this year increased 35% over that same time frame as port and mine expansion plans begin to ramp up.

In Brazil, third quarter operations recovered from earlier weather-related disruptions as exports increased 5% in quarter 3 as compared to the prior quarter. Overall, Brazilian iron ore exports are down 3% for the year but have picked up as of late, leading to tighter availability of Capesize vessels in the Atlantic.

Going forward, exports for both Australia and Brazil may increase as miners bring greater amounts of iron ore to market. According to Australia's Bureau of Resources and Energy Economics, the country's exports are forecasted to grow by 10% in 2012 and 9% in 2013, reaching 483 million tons and 528 million tons, respectively.

The main destination of these exports is China in which iron ore shipment has set another monthly record in September. Chinese iron ore imports from Australia increased 19% in September year-on-year, amounting to 34.5 million tons.

All international iron ore prices together with the export limitations in India continue to make Australian ore as well as Brazilian and South African ore much more attractive to buyers. On the coal side, demand may increase in the medium term as a result of both higher steel production and power consumption.

Domestic coal supply continues to fall short of demand in India leading to coal imports rising 18% from April to September of this year when compared to the same period of last year. The domestic coal supply and demand gap is expected to be close to 200 million tons in the year ending March 2013, and could expand to as much as 250 million tons by 2017.

On Slide 19, we discuss the supply fundamentals which remain uncertain. Although we expect the order book to be less cumbersome in 2013 and beyond, it still remains at approximately 22% of the existing world fleet.

Newbuilding orders have, however, decreased by 52% through the first 9 months of 2012, and only to Capesize newbuilding vessels have been contracted since the end of March of this year. Declining newbuilding activity, along with stronger steel prices have put pressure in shipyard margins, increasing the potential of bankruptcies by some of these less established Chinese shipyards.

We believe scrapping will continue to play a significant role through 2012 and into 2013 especially if volatility in the freight rate environment persists as 18% of the world fleet is 20 years or older. As illustrated on the graph at the bottom right of the page, 2011 and 2012 to date have been record years for scrapping with 23.1 million deadweight and 28.4 million deadweight scrapped, respectively.

Notably, the Handysize fleet year-to-date has had 6.5 million deadweight scrapped versus 8.6 million deadweight delivered. This represents a scrap to delivery percentage of 76%, which is by far the highest of any vessel class in the drybulk sector.

Additionally, in the third quarter of this year, the Handysize fleet had a net subtraction of 6 vessels. Lastly, we note that the Capesize order book now stands at 53.9 million deadweight which represents a 49% decrease year-on-year and the lowest volume on order since mid-2007.

This concludes our presentation, and we are now happy to take your questions.

Just had a few follow-up questions to your comments. The first one, obviously, charter rates during 3Q were very weak, but as we've seen and as you've mentioned, we saw a fairly significant snapback in Capesize rates since mid-September about a fivefold increase.

My question is what is your take on that fivefold increase as far as what it tells you about the underlying supply-demand balance within the drybulk market ahead of a period where demand seems to be accelerating and fleet growth seems to be decelerating?

Yes, Doug, this is John. I think the first thing is the demand side, as we've been saying all along, remains intact.

And yes, while we saw a slowdown in Chinese imports during the third quarter, that was more -- that's more of a natural process because they went in the market first and second quarter in bought big. We've seen this time and time again over the last 7 or 8 years.

So the demand side, we continue to believe it's intact. Obviously, in the supply side remains an issue but we fortunately have seen a real dramatic slowdown in deliveries and that is -- definitely helped boost freight rates.

But I think -- look, the main thing to take away from this is we are still seeing 6% to 7% demand growth on an annual basis.

Right, right. So for those fears in the marketplace that given all the supply growth over the last few years and that the market would be perpetually oversupplied, does it make sense that, that would be true if rates increased fivefold?

Or is it just basically saying "Look, the underlying supply-demand balance is actually much better than people are probably thinking?"

Look, I think you can say it's better than people were thinking but I still think we have a little ways to go to work through the supply and let demand catch up. And like I said, the important thing for drybulk shipping is that you do have a growing demand in the mid- to high single-digits.

Right, got you. Got you.

And then kind of looking at the fleet itself and maybe using your fleet as a proxy for the industry, at $16,000 a day, are you guys still slow steaming some of your capes? And are there any idle ships out there that you are aware of?

Yes, we are still slow steaming the capes. I mean we're slow steaming the majority of our vessels on their charters instructions, of course, Doug.

Idle vessels, I don't know. Again, I think we've got 4 big managers managing fast fleets and none of them have got any vessels that are idle.

Got you. Got you.

And then finally, John, you talked about the supply side of the equation and then Gerry's comments, you talked about how we've seen a fairly significant slowdown in the number of deliveries over the last few months. My question is, is that trend likely to continue in your view based on the order book?

And then secondly, looking at the order book, we still see a lot of questionable potential deliveries. I mean, last year at this time, there were 50 million deadweight tons that's supposed to be delivered within the 2011.

They never happened. Right now, there's 50 million deadweight tons that's supposed to be delivered to them 2012.

That's unlikely to happen. So my question is, with the second part, is there still about 1/3 of the order book that seems very questionable in your view?

Yes, I mean, definitely -- I was just going to say the slippage numbers continue. And yes, I would say it's 35% to 40%.

And so, yes, I think there is definitely question marks as to what gets delivered. I think overall, Doug, just going to the first part of your question, I would say the trend on deliveries is a downward trend.

We may see a little bit of a pickup in the first quarter, which I think is natural as people try to get a 2013 delivery date. But what was promising is that as early as, say, August and definitely September, we saw a large slowdown in deliveries and I do think that trend will continue throughout next year.

Okay. And Peter, you sounded like you were -- because I was trying to use a conservative number, saying 30-some-odd-percent but it really looks like it's probably closer to 40%, if not closer to maybe even 45% that these -- if you look at what the broker reports have been suggesting, they've just been pushing forward this 40-plus-million deadweight tons of deliveries that just doesn't seem to be coming.

I mean is that about right in terms of how you're seeing the world?

Exactly, that's exactly correct. And -- it's just been pushed forward and eventually, it's going to disappear.

I think one other -- I think the other story is the scrapping. If you go back prior to last year, the biggest year for scrapping for dry cargo was about 5 million tons or so.

Last year was about 25 million tons, and this year, year-to-date and we're not done yet, is close to 30 million tons.

Which is about 5% of the fleet, right?

Yes, huge numbers and the age that they're scrapping is much younger. So we think it's going to take time, but we think that supply-demand balance will come back.

It's Josh Katzeff in for Justin. I just wanted to follow up on one of the previous questions with that slippage figure about 40%.

Do you guys have any estimate on what's actually slippage and what's just never going to be delivered from that 40%?

No, it just doesn't -- it just don't report it. It just -- eventually, as I said earlier, it just eventually disappears.

We think that, that's really -- those ships are really not going to be built. We don't think that's slippage.

We think it's just -- they're not going to be built because if you think about it, if you ordered a ship in 2008 and you had a bunch of options, those options get reported as ship's being built. But you're not going to declare an option at the 2008 prices.

So a lot of outlying ships or option ships that will never be delivered.

Got it. And then you guys don't think that any of these Chinese yards are going to start building any of these ships in spec and then just [indiscernible]...

Impossible. No way.

That I can guarantee you.

Okay. I guess shifting over to employment strategy, just looking at some of the new charters.

It looks like some of the Supramaxes were chartered on short term, charter 6 months or I think maybe went a little bit longer. I guess maybe can you talk about the strategy of chartering between the different sectors with I guess some fixed rate charters on the Supramaxes, but not really on the Panamax or smaller ships?

Yes, I mean, the only fixed rate charters that we have done are very short term. They usually have been short trips or maybe as long as 3 months.

We still have the same strategy of putting things away under stock market-related time charts. That has not changed.

I guess is there any difference between trip charters and the Supramax sector or Handysize sector and Panamax? Or I mean I'm just kind of curious why they were all done in the Supramax sector?

Is there any sort of dynamic going on?

No, I wouldn't say there's any dynamic going on. When we have ships that are open, we obviously try to stay ahead of the curve.

But we deal with the market at a time and who need ships from our chartering pool.

Got it. And I guess just more broadly on the near-term outlook, I understand you went over some of the more longer-term fundamentals, but we've seen Caperidge [ph] rally up to $16,000 to $18,000 a day so far.

And though the weak grain season has kind of mitigated some of the smaller ships' rallies. Is there anything that gets these Panamax rates and Supramax rate higher in Q4 or are you expecting them to kind of be flat in the near term?

I mean I think we could see a little bit of a pickup still in fourth quarter. I mean you still have pretty low coal inventories in China.

And so I expect to see increased fixtures there. I do expect to see the grain season comeback in the first quarter as we change hemispheres.

But look, iron ores is driving this right, but you do get to a point where the ratio between capes and some of the smaller vessel classes get a little out of whack and see -- you see the smaller vessel classes will catch up.

I guess how much of this has been an impact from Indonesian exports or have those started to pick up yet?

I don't think we've seen too much of that yet.

A couple of questions. I guess I'll kick one off for Peter and this is kind of a higher level kind of long-term picture.

But, just under the assumption that the market finds it's sort of an equilibrium and there's certainly systemic floors in place like those scrapping you've talked about that it'll lead it there at some point. From our perspective, the key to this sector kind of catching institutional bid is going to be the notion that this supply curve is not going to happen again.

And the biggest function there is going to the restriction on lending. So I guess, Peter, from your perspective as a principal, I guess, how do you think about just the long-term dynamics on this business and really kind of the key notion that we're going to have kind of a steady state solid demand environment and a rate environment is in positive territory while lending is going to be restricted in the space.

I mean, I guess, longer term and conceptually, how do you think about that as just someone who's going to be putting money to work here?

I mean that's the position we want to get to and that's the position we believe within the next couple of years, we will get to. We think that I'm not going to say people have learned their lessons because people never learn lessons.

But I think that the banks, I don't care how much better things get, will definitely not be there lending money the way they were to speculative newbuilding orders the way they were 4, 5 years back. I mean I remember back in 2006, '07 -- just a little history, 20 years ago, if you ordered 2 option, 2 ships, that was a big order.

3 option, 3 ships, 2006, '07, people were ordering option 10, guys you'd never heard of them. I'm talking about companies like Teekay or Frontline, or big companies, people you've never heard of.

That's not going to happen again. It's just not going to happen again.

And so, where we'd have to have such a crazy situation before that happens. So I think what you'll see is with this scrapping and if you've seen a lot of discipline of those scrapping that's why I think it's impressive.

By owners scrapping ships built in the '90s shows a lot of discipline, also no orderings. So I think that's supply side as that works off from no new orders.

The orders that we think are there not showing up and scrapping and then the demand will just -- we know that, that demand is going to continue to grow. I'm a big believer in China and I just believe that it will continue to grow at the pace that John and Gerry have been talk about and I think we'll get to some kind of equilibrium.

I think you will have a decent market. Do I think the market is going to go to $200,000 a day?

Probably not. But we can make a lot of money at a less than $20,000 a day.

Got you. Now that's helpful.

I guess, John, Gerry, you guys mentioned, I mean, you guys have been pretty forthright about chartering strategy which makes a fair amount of sense. But assuming we are getting closer to kind of the persistent and longer-term term, you would think we'd see kind of an uptick in interest on longer-term charters?

It's kind of like we're seeing in a product tanker sector right now, when you guys seeing an uptick in people and your customers approaching you looking for a longer-term deal, looking to lock up case and Panamax is at stress levels sort of 3 and 5 years. And then maybe if you can kind of -- I don't know if you can quantify but maybe this quarter over the last or this quarter over a year ago, maybe just kind of what you're hearing from your customers and what makes you think we might be closer to kind of sustainable recovery?

We definitely are starting to see charters come in and looking for ships. We think the rates are still a little bit lower than we'd like to lock things up long term for.

That's because we believe that as the quarter continues and as we -- as things get a little bit better, we can capture some higher rates. I don't know.

John, Gerry, do you want to add anything in?

Yes, I mean, I would tell you there's been definitely a change over the last 3, 4 weeks from the third quarter. I mean the third quarter was pretty quiet, not a lot of liquidity.

And now we're seeing some of the larger iron ore guys in particular looking to lock up ships for longer periods of time.

Got you. And John, when they're coming into the market, are they looking for a year or are they looking 2 to 3 years?

I mean what sort of per year are they coming in with?

I would say it's more of the 1 to 2 year right now.

Got you. That's helpful.

And I think you guys get asked this a lot based on your current strategy, but if we'd say that we would just boil down the capes, I mean, what kind of level would you guys need to see that would make you comfortable locking in them up for 1 year to 2 years?

Yes, we get asked that question a lot. Yes, look, we obviously have -- we have our ideas, not something we really want to share at this point.

But we watch it daily. I mean the 3 of us have conversations about it all the time.

So when we get there, obviously, we'll let people know.

Fair enough. There's one more and I'll turn it over.

And something else you guys have been asked about a lot and you've got some leeway now but around your bank deal and your covenants, you guys have gotten until the end of next year as we've got 5 quarters here. But certainly, absent of market recovery, you guys are going to need to negotiate again.

At what point, I mean, should we realistically expect the banks to come back to the table and for you guys to start those conversations because obviously, it's very early now but is that summer next year at the earliest in terms of the timeframe? How should we think about that?

I mean, that would be the earliest I would think at this point. I mean, the one thing I'll say is we -- look, we maintain weekly contact almost with our banks.

So it's not like things just go quiet.

I was just going to add that in. I mean John and I just went on a trip where we met with our major banks last week.

I mean it's just something we believe and keep in front of these guys, telling them what we're doing I think they view us as really the top dry cargo company out there and so for us, we're on top of it all the time. And if there's any change, we'll let you know.

But again, as John said, I think next summer is the earliest that these conversations will begin, but they're ongoing.