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Shipping Part2
Shipping Part2
Agenda
Part 1. Introduction, Nomenclature, Major
shipping companies
Part 2. Charter - Voyage, time and
others
Part 3. Deck maintenance
Part 4. Engine room and maintenance
Part 5. Communication system and others
Chartering
Chartering is an activity by which, a
charterer (who will normally be the owner
of the cargo) will get into an agreement
with shipowner or shipbroker for
transporting the cargo at certain price
known as Freight rate.
Chartering
A charterer may also be a party without a
cargo who takes a vessel on charter for a
specified period from the owner and then
trades the ship to carry cargoes at a profit
above the hire rate, or even makes a profit
by re-letting the ship out to other
charterers.
Chartering
Freight rates are prices at which cargo is moved
from one point to other.
Freight rates may be on
- Per-ton basis over a certain route
or
- Per-day basis for the duration of charter.
- Nature of Cargo being shipped (Value of
goods, Perishable etc.,)
Chartering
Freight rates for Bulk Carriers and Tankers
would be on tonnage basis.
Freight rates for Containers would be on
volume basis.
Both Tonnage and Volume data would be
used to arrive at Freight rates.
Chartering
Depending on the type of ship and the
type of charter, normally a standard
contract form called a charter party is used
to record the exact rate, duration and
terms agreed between the shipowner and
the charterer.
Types of Charters
Voyage Charter
Time Charter
Bareboat Charter
Demise Charter
Charter Party Members
Charterers
Vs
Ship Owner / Ship Operator / Ship
Management Company / Ship Brokers
(Shipbrokers are specialist intermediaries
between shipowners and the charterers.)
Voyage Charter
Voyage Charter Charterer pays per ton basis.
Vessel costs like fuel costs, navigation costs,
salary of crew will be paid by Owner
Vessels can ply between two ports or can touch
many ports.
Initial Start Port and Final Destination Port will
form end points for Voyage Charter.
A Voyage Charter may contain sub-voyage
charters.
Voyage Charter - Contd
The entire ship is chartered for the
transport of a full cargo, and this can be
detailed out as:
- for a well determined voyage
- for a voyage to go and return
- for a series of specific voyages
- for a round trip with different harbours
and the right for the charterer to load and
discharge
Time Charter
Charterer pays for fixed time period.
Vessel owner will take care of Fuel costs,
Navigations costs, salary of crew.
Cargo Management Company would
decide upon ports, routes etc.,
Time Charter - Contd
Period time charter - the charterer can make as many
trips during that period with the ship as he possibly can.
Trip time charter - only a single trip can be made just as
under a voyage charter but at time charter conditions.
Under a time charter the ship owner is only responsible
for the nautical and technical operation of the ship
whereas the charterer is responsible for the commercial
operation of the ship.
It follows that under a time charter, the fixed costs of the
ship are for the account of the owner and the variable
costs are for the account of the time charterer.
BareBoat Charter
Charterer hires vessel for entire period.
Charterer pays for all expenses.
It is indirect way of acquiring vessel at the
end of charter period
Demise Charter
Charterer takes full control of Financial
and Legal responsibility
Latest Trends in Charter
Cross Charter Ship owners can also be
part of charterer for part of the ship.
Storage Chartering Ships are chartered
for Storage of goods.
Charterparty