NAU103 Introduction to Marine Transportation. Tramp Shipping vs. Liner Shipping Operations

Transcription

1 NAU103 Introduction to Marine Transportation Tramp Shipping vs. Liner Shipping Operations

2 The nature of tramp shipping Seek cargo where it can be found Work the established trades Provide transportation flexibility Alleviate transportation shortages Tramps are private carriers

3 The role of agents Owners of tramp ships depend on brokers throughout the world to find cargo Brokers have expert knowledge of the current status of international trade Some brokers specialize in certain trades while others represent only certain shipowners

4 Tramp Shipping vs. Liner Shipping Operations The Baltic Exchange London For centuries, the place where brokers put together deals between shippers and shipowners The original building was destroyed by an IRA bomb in 1992 Today, most of the chartering is carried out electronically

5 Tramp vessel types Liberty 10,500 ton WWII leftovers SD-14 14,000 ton general cargo vessel introduced in 1968 to replace old war surplus vessels Today, nearly any handy-size general cargo ship may serve in the tramp trade

6 Tramp vessel types Bulk ships many except the very largest may be placed in service as tramps Bulk cargoes like grain are likely to require movements at irregular intervals Smaller bulk vessels are constantly seeking such business

7 A risky business Owners of tramp ships are almost always at a disadvantage in the shipping market Rarely is the demand for shipping so great that shippers will agree to almost any price Usually, the tramp operator is fortunate to obtain rates that that are slightly above costs

8 Liner Shipping Ships making regularly scheduled runs serving certain ports are by definition common carriers. They transport cargoes of many different shippers at the same time Before the 1970s, most liner vessels were break bulk vessels From the 1980s on, all liners were containerships

9 Liner Shipping In terms of value, general cargo represents 60% of all goods shipped by sea Liner service tariffs are more stable when compared to freight rates in the charter (tramp) market More attractive to small shippers of high value goods

10 Tramp Shipping vs. Liner Shipping Operations Origins of Liner Service Began in 1870s with steamship technology, shipping agents (brokers) and the telegraph Steamships created the supply, and new commercial systems created demand Liners services grew over time into the comprehensive transportation system we have today

11 Tramp Shipping vs. Liner Shipping Operations The Cargo Liner Versatile ships with their own cargo handling gear Ship designers built flexible ships that could carry all sorts of cargoes At first, little different from tramps, the ships could alternate trades as the market demanded Later, liner ships grew too big and expensive to use economically as tramps Used only on the most lucrative runs

12 Break bulk cargo handling inefficient and expensive Required long port stays Very slow loading and unloading Many longshoremen Theft a major problem Re-handling and warehousing very expensive

13 Tramp Shipping vs. Liner Shipping Operations Changing trade patterns Transpacific and European trade boomed after WWII The poor performance of existing cargo liner service became untenable By the 1960s, break bulk cargo liners were technologically obsolete The age of the containership had arrived

14 Tramp Shipping vs. Liner Shipping Operations The economics of liner operation today In 2004, 17 million TEU crossed the Pacific, 5 million TEU the Atlantic In 2006, Maersk, the largest liner company had a 16% market share In 2007, there were 4200 containerships, with 1300 on order 50% of ships are owned by independent operators, not the liner companies themselves

15 The liner companies About 250 liner service companies exist today The smaller liner companies form alliances or conferences in the attempt to compete with the largest carriers like Maersk Conferences also have the desired effect of stabilizing prices and distributing business