THE MARITIME TRANSPORT MARITIME TRANSPORT MARKET MARKET

HISTORY OF MAR TPT

4000 BC BOATS FOUND IN EGYPT 3000 BC MAR TRADE BEGAN IN EAST MEDITERRANEAN 15TH & 16TH CENTURIES VOYAGE OF DISCOVERY MIDDLE 19TH CENT, BRITAIN CONTROLLED OF WORLDS SHIPPING & OF SHIPBUILDING

 COLLAPSE OF COLONIALISM DIVERSIFIED TRADE LINKAGES RAPID INDUSTRIALIZATION OF ASIA ENHANCED ROLES OF ASIAN COUNTRIES IN SHIPPING CURRENTLY ASIAN SEA BORNE TRADE IS SAME SIZE WITH EUROPE & MUCH BIGGER THAN NORTH AMERICA

THE SHIPPING MARKET CYCLE

THE UP & DOWN OF SHIPPING DEMAND ARE SIMILAR TO OTHER INDUSTRIES DIVIDED INTO 3 TYPES: LONG-TERM CYCLE (SECULAR TREND)
LASTED ABOUT 50-60 YEARS TRIGGERED BY NEW TECHNOLOGICAL INNOVATION

SHORT-TERM CYCLE(BUSINESS CYCLE)

3 12 YRS FROM PEAK TO PEAK DRIVEN BY BUSINESS CYCLES

SEASONAL CYCLE

THE ECON PRINCIPLES OF MARITIME TRADE

COUNTRIES HAVE A CHOICE TO TRADE OR NOT TO TRADE THE THEORY OF ABSOLUTE ADVANTAGE SHOWS THAT COUNTRIES ENJOY A HIGHER LIVING STD IF THEY TRADE BECAUSE IT ALLOWS TO FOCUS THEIR SCARCE RESOUCES IN THE PRODUCTS THEY ARE MOST EFFICIENT AT PRODUCING

Cont.
GNP OF A COUNTRY IS MOST IMPORTANT FACTOR TO DETERMINE TRADE VOLUME AS COMPARED TO SIZE & NATURAL RESOURCES EARLY STAGES OF TRADING FAVOUR BULK SHIPPING BUSINESS & WILL SHIFT TOWARDS LINER SHIPPING WHEN THE ECON REACHES MATURITY INITIALLY IMPORT OF MANUFACTURES ARE PAID BY CASH CROP EXPORT AS INDUSTRY EXPANDS, RAW MATERIALS GENERATE DEMAND FOR SEA TRANSPORT

OVERVIEW OF DEMAND IN MAR TPT

COMMODITY CARRIED BY SEA DIVIDED INTO BULK & NON-BULK BULK IS CARGO WHOSE HOMOGENEOUS PHYSICAL CHARACTERISTICS LEND THEMSELVES TO MASS HANDLING IN LOOSE FORM NON-BULK CARGOES ARE THOSE PLACED OR DRIVEN ONBOARD

BULK CARGO

DRY BULK

LIQUID BULK

NON-BULK

NON-BULK

LIQUID BULK TRADE

OF TOTAL SEABORNE MOVEMENT OF GOODS CRUDE OIL & PETROLEUM PRODUCTS ACCOUNT 95% OF LIQUID BULK TRADES 5% LPG, LNG, VEGE OIL & CHEMICALS MAIN ROUTE FM MIDDLE EAST TO N.EUROPE & N.E. ASIA 2ND ROUTE CARRIBEAN BASIN TO US ULCC MAY CARRY UNTIL 350K TONS CRUDE OIL

DRY BULK TRADES

DOMINATED BY STEEL INDUSTRY & ELECTRICITY GENERATION IRON ORE & COAL APPROX 800M TONNES/YR GRAIN SHIPMENT 200M TONS & BAUXITE 50M TONS TRADE PATTERNS INFLUENCED BY NATURAL RESOURCES ENDOWMENT VESSELS UNTIL 300K DWT USED FOR IRON ORE TRADES

NON-BULK TRADES
THE MOST COMPLEX IN MAR MARKET 3 COMPONENTS CONTAINERIZED, NEOBULK & BREAK BULK TRADES CONTAINERIZED DIV INTO 2 COMPONENTS, EAST-WEST MAINLINE SYSTEMS & A SET OF N-S SYSTEM NEO-BULK ARE THOSE THAT TEND TO TRAVEL IN SUFFICIENT VOL BUT DO NOT USE BULK HANDLING TECHNOLOGY BREAK-BULK CONSISTS OF ELEMENTS UNSUITED TO CONTAINERS

PASSENGER FARE & FREIGHT RATES

PASSENGER FARES ARE DICTATED BY NATURE OF VOYAGE, CLASS OF SHIP, ACCOMODATION OFFERED & OTHER FACTORS FREIGHT IS THE REWARD PAYABLE TO THE CARRIER FOR THE CARRIAGE & ARRIVAL OF GOODS IN A MERCANTILE OR RECOGNIZED CONDITION FREIGHT RATES DEPEND ON FORCES OF S&D, AND AFFECTED BY COMPETITION FROM CARRIERS ON THE SAME ROUTE & FROM DIFFERENT ROUTES AND ARE ALSO INFLUENCED BY MANY FACTORS

Cont.
LINER & TRAMP RATES NORMALLY FLUCTUATES IN THE SAME DIRECTION ALTHOUGH LINER RATE IS LESS SENSITIVE TO CHANGES IN MARKET DEMAND & MORE SENSTIVE TO CHANGES IN COST A VOYAGE CHARTER RATE IS A SHORTTERM RATE & A TIME CHARTER RATE IS A LONG-TERM RATE. HENCE WHEN CONDITIONS ARE IMPROVING T.C.R TENDS TEND TO RISE MORE RAPIDLY THAN V.C.R & WHEN CONDITIONS ARE DETERIORATING V.C.R TEND TO FALL MORE RAPIDLY

TYPES OF FREIGHT
ADVANCE FREIGHT LUM SUMP FREIGHT DEAD FREIGHT BACK FREIGHT PRO-RATA FREIGHT AD VALOREM FREIGHT

TUTORIAL
COMPARE THE BUSINESS CYCLE & THE SEASONAL CYCLE EXPLAIN 3 TYPES OF FREIGHT DISCUSS THE ADVANTAGES OF CONTAINERIZATION

GOOD LUCK