Introduction: types of ships

Container ships
90 % non-bulk cargo by container Optimizes space Capacity TEU Above certain size: no own loading gear

Bulk carriers
Bulk carrier, bulk freighter, bulker Unpackaged bulk cargo 40 % worlds fleet Single hold mammoth ships Specialised designs

Oil tankers
Hydrocarbon liquids (crude oil -> refined products) DWT VLCC (200 000 320 000) ULCC (320 000 550 000) 8 12 tanks Pump room

Chemical tankers
Chemical in bulk Ocean going: 5 000 40 000 DWT Smaller because specialised nature of cargoes Separate cargo tanks (coated / stainless steel) Every tank own pump and manifold

LNG tankers
Cooled to -163 Part converts to gas => diverted to engines & used as fuel

LPG tankers
Temperature lowering Pressurizing

Ro R o
Wheeled cargo Ramps

General cargo
Any sort ship that carries cargo General freight (raw materials -> finished products)

Coastal vessels
Same continent (-> not crossing ocean) Some small enough ( => travel inland) Wet and dry bulk, containers, passengers

Cruise ships
Passenger ship for pleasure voyages

Merchant fleet of the world

Structure of the world fleet
Expansion of the fleet In spite of economic crisis => still expansion of fleet in 2009 (vessel orders placed before crisis) Age distribution of the fleet Average per ship higher than average age per dwt (ship size grown => younger ships contribute more dwt)

Delivery of new-buildings
Still new ships built No new orders

Demolition of ships
Increased dramatically in 2008 2009 (older tonnage at low price) World fleet gets older & new-buildings built to last longer => average age broken ships increases

International trade
Chartering, a general introduction
Definition Chartering is an agreement, whereby one party, the owner, puts a ship or a part of it at the disposal of another party, the charterer, for the carriage of goods between named ports. The charterer can sublet the ship or a part of it to a third party and becomes the Disponent owner. The chartering agreement is contained in a document, called Charter Party. History Contracts of affreightment from moment merchant didnt accompany his goods End Middle Ages: o Development shipping industry o Each harbour: own customs and uses Through years: charter party more complex and more clauses => long negotiations End 19th century: texts more uniform BIMCO & Chamber of Shipping (UK): typical charter parties issued Pre-printed documents in English, fill in blank spaces Bill of Lading represents the goods, sometimes serves as contract of affreightment

Types of Charter Parties

Different ways Own goods / third party Belgium: for the whole vessel or a part of the vessel, for the complete voyage or for a limited duration, by weight, number or measure, against a fixed price or by quantity of cargo

Voyage charter Stated quantity, type of cargo, named vessel, named ports, agreed price ( = freight) Most widespread form Ship chartered entirely: agreement noted by charter party Costs for ship owner (cargo handling costs stipulated by contract)

Time charter Named vessel, specific period of time (no restrictions) Time during differs o Period time charter (as many trips during period) o Trip time charter Ship owner responsible for nautical and technical operation, fixed costs Charterer responsible for commercial operation, variable costs Time charterer hires ship equipped and manned

Bareboat charter Charterer must equip and man the ship Charterer has complete control of ship Ship owner: capital, insurance, classification Specific type of time charter

Lump sum charter Lent against fixed sum Loaded quantities not taken into account, only space made available

Contract of affreightment Fixed price per ton transported cargo without named ship Ship owner operates entire fleet: transfer goods with most profitable operation Charterer: no worries about transport of goods Ship owner: use of ships with maximum flexibility

Booking note Simpler document Used in liner trade Shipment of important goods reserved long ago

Forward voyage charter Type of booking note, used in tramping Ship owner fix cargo in the future

Breakdown of costs

Fixed: capital, interests, deprecations, manning costs, stores, repairs and maintenance, insurance and administration costs Variable: fuel, ports dues, tugs, pilot costs canal dues, agency fees, cargo handling, cost for stowing of cargo, claims

The bill of lading

Definition Written statement from the master Three functions: o Receipt for goods o Contract of carriage o Document of title "Bill of lading" means a document which evidences a contract of carriage by sea and the taking over or loading of the goods by the carrier, and by which the carrier undertakes to deliver the goods against surrender of the document. A provision in the document that the goods are to be delivered to the order of a named person, or to order, or to bearer, constitutes such an undertaking. o Named person: only person in consignee has right to receive the goods o To order: Bill of Lading can be transmitted to third person by endorsement of original B/L, name and address new holder specified o To bearer: everyone holding original B/L right to receive the goods, case of loss => certain danger

B/L versus C/P More important than C/P C/P represents hire of tonnage space B/L represents goods Tramping: generally both Liner shipping: only B/L C/P = gestation agreement B/L = actual agreement

Persons and business related to shipping

Ship owner
Equips ship, necessary provisions, crew Operates and runs her Sometimes some task to charterer If owner is group persons / enterprises => shipping company

Disponent owner Owner not operate ship himself => entrust to third person / company Operator

Shipping agent
Permanent representative of the owner Looks after owners interests, in his name and at his expense Acts in his name with regard to rights and duties of owner to third parties Duties very variable & depending on sort of service Duties & remuneration entered in contract (liner trade) Tramping: almost never written contract, tacit competency, owner remains legally liable Several categories

Port agent See pag. 35 36 Agency fee Trustful and energetic agent Charterer can demand to appoint agent Owners pay agency fee Agent protects interests of owner, independent of who appointed him

Liner agent When company has no own organisation, appoint liner agent Agency contract / agreement Duties classified in 2 categories o Cargo broker o Dispatcher See pag. 37 40

Own agencies Large companies in countries where they have lot of interest => own office Head usually delegate from company Same policy in agency as in company Seldom any conflicts Adapt to local practices Same duties as liner agent o Cargo broker o Dispatcher o Information task (owners informed about cargo, harbour & local info) o Control task (quality & prices of port, volumes & freights of cargo)

Forwarder
Arranges transport of goods in own name but for account of his principal Carries out activities related with transport o Reception o Delivery to third carrier o Storage o Insurance o Clearance through customs o Export / arrange to export Agent with services to move goods to their destination Intermediary between shipper and ship Easy flow at lowest cost

Duties in sea transportation See pag. 41 Tasks in harbour See pag. 42 Categories of forwarders Forwarder = specialist in execution of transport agreements / contracts Neutral intermediary between seller and buyer Different kinds depending on sort of service

Transport broker
Every person who puts two or more persons in contact with each other for contract of transport Tramping: owner not well informed of goods available, exporters not informed about available ships Ship owner principal: compatible cargo for ship ( = shipbroker) Exporter principal: appropriate ship ( = chartering / freight / cargo broker)

Shipbroker Hiring a ship (time charter / voyage charter) Ships continuously employed for highest possible freight Shipbroker has no responsibilities

Chartering broker Find a suitable ship No responsibilities

Sale and purchase broker Mediates in buying and selling of a ship Draws op memorandum of agreement

NOTE: Chartering broker and shipbroker often by same office Remuneration brokerage commission

Main traffic routes, important areas and canals

Overall seaborne trade
Still growing, but at slower rate More than 8 billion tons, dry cargo largest share (2/3) Sharp decline demand for consumption goods Fall in industrial production & reduced energy demand Container trade: sharpest deceleration (11% -> 4,5% ) Shipping is vulnerable to economic downturns Affected by o Energy security & prices o Bunker fuel costs o Climate change

Coal seaborne trade

Fossil fuel energy source, more abundant than oil / gas Different types => different uses o Steam / thermal coal => power generation o Coking / metallurgical coal => steel production Other important users o Aluminium refineries o Paper manufacturers o Chemical and pharmaceutical industries China largest producer Global consumption slowed Still fastest-growing fuel Coal production increased, but used in country where produced Indonesia and Australia over half worlds thermal coal shipments Australia largest coking coal exporter Main destinations (both types) are Japan and EU (48,1 %)

Grain seaborne trade

Production increased Canada and US 53,1 % world grain exports Improved weather conditions => grain importing countries more own grain

Iron ore seaborne trade

Widely used metal o Structural engineering o Industrial applications o Automotive sector Producers: China, Australia, Brazil, India, Russian Federation, US, South Africa, Canada, Sweden Main exporters: Australia & Brazil (2/3) China = main destination

Crude oil seaborne trade

Affected by: o Energy prices & market o World economic situation o Rising profile of environmental considerations Global oil demand fell Economic downturn => less demand for energy => reduction in production Production increased Oil supply: Western Asia, North America, Africa Share tanker trade = 33,7 % 2/3 crude oil Western Asia main loading area Major unloading areas: Europe, North America, Japan, Southern & Eastern Asia

Container seaborne trade

Increased Share to total dry cargo: 25,4 % Investigation in: o Larger and more sophisticated container ships & equipment o Port and terminal operations Economic downturn => future uncertain

Important areas and canals

Suez Canal Man-made sea-level waterway in Egypt (Mediterranean Sea Red Sea) Northern terminus Port Said, southern terminus Port Tawfik (Suez) 192 km long o 19,5 northern access o 162,25 canal itself o 8,5 southern access Single lane, passing places Ballah By-Pass & Great Bitter Lake No locks Ships dimensions: 19 m draft / 210 000 DWT, max. air draught 68 m, max. beam 77,5 m In convoy (2 southbound, one northbound) Speed: 8 knots Transit time: 11 16 hours

Panama canal 77 km (Atlantic Ocean Pacific Ocean) 14 702 vessels in 2008 13 000 km shorter Artificial lakes Three sets of locks Reservoir (Alajuela Lake) Ships dimensions : 294 m LOA, 32 m beam, 12 m draft, 58 m air draft, DWT 65 000 80 000 Total tonnage rises Major improvements: o Widening and straightening Gaillard Cut o Deepening channel Gatun Lake o Deepening entrances Handling more vessels than envisioned

Shipping companies
General
Traders commercial and business transactions separated from operation of ship Independent shipping companies offer services solely as carriers Now centre of shipping enterprise Structure depends mainly on structure of goods being carried o General cargoes (liners) o Bulk cargoes (trampers) Dry bulks (tramp companies) Liquid bulks (tanker companies) Further specialisation possible (passengers exclusively, only coastal navigation ) Special types of ship consistent with type of cargo o Liner Traditional general cargo ships (freighters) Container ships Ro-Ro ships Polyvalent ships Refrigerated ships o Tramping Bulk carriers Tankers VLCCs ULCCs OBO PROBO LNG LPG Lighter ships Ships for carriage of special cargoes and/or heavy lifts o Sometimes difficult to categorize Structure tramping and liner company is different

The liner company

Characteristics of the liner trade Regular lines => well established, guaranteed and pre-published schedules Regularity, punctuality, speed, reliability, stable prices Purpose: carry small lots of goods from numerous shippers to large number of receivers Bill of lading => shipping operator acts as carrier Main elements: ships, goods, freights and tariffs

The ships Costly, relatively large size, in best condition Carry wide range and types of goods Design and speed => relatively expensive Most companies several ships on same line o Cargo offer > carrying capacity: additional ships added (from tramping) o Cargo offer < carrying capacity: sail partially empty / compete with tramping

The goods All sorts packaged general cargoes of great value belonging to large number of owners for whom quick and prompt dispatch is of utmost importance Bulk cargoes only when quantity is too small for tramping Not only ongoing cargoes In home port and other important ports of call: own quays and loading and discharging equipment All port of calls: backed by international and many branched organization with agencies, representations and canvassing services Some use feeder services (= local branches of another regular line service (coastal trade, inland shipping, air carriers ) responsible for supply and conveyance of goods Some liner ships adapted to carry unit loads => shorten time at sea and in harbour => carry as much cargo as possible per year and per ship Also passengers

The freight and tariffs Established by shipping conferences on contractual base for certain period or for specific quantity or type of goods Maximum stability and fixed base for freight calculations Considerably higher than in tramping

The organization of a liner company Depends on number of ships Three large divisions: o Operating division o Technical division o Administrative and financial division General management o Overall policy o Contracts, capital and shares, appointment of executive personnel Operating division o Heart maritime company o Primary activity, composed of several departments Technical division o Secondary activity o 2 large subdivisions Marine or nautical department (nautical equipment, ships supplies) Engineering department (technical operation, maintenance) Administrative and financial division o Personnel department (recruiting, wages, training ) o Accounting department o Statistics and control department (operating costs, fuel and oil consumption ) o Legal department See figure p. 79

The tramping company

Characteristics of a tramping company Very irregular, very unstable, very little organised Ships contractually put at disposal of charterers Usually each voyage apart from the other Vessel is independent operating and competing unit, operation highly individual Sailing schedule very irregular Ship operator sees that ship is rarely idle and in port of discharge Ballast voyages must be avoided (= main problem) Main elements: o Ships o Cargo o Freight

The ships Vary in size, sometimes lesser quality than liner ships Doesnt need highly sophisticated equipment Relatively slow and cheap Present-day tramp fleet counts numerous modern bulk carriers suitable for different sorts of cargoes

The cargo Unpackaged bulk goods / massive amount of general cargo / seasonal products Belongs to one shipper No special care to manipulation and stowage, speed of delivery not that important

The freight Freight is low Relative low value of goods Established on international freight market (rules of offer and demand) NOT FIXED

The organization of a tramping company Simpler organization Depends on number of ships o One ship => one-man business o Reasonable number of ships => similar organization as liner company

Industrial ocean carrier Large quantities of raw material for own need Ships belong to larger companies (e.g. oil companies) or are chartered for long period Government enterprises / private enterprises Operated as individual affiliated companies

The organization of the industrial ocean carrier Almost similar to tramping If owned by company => operated by maritime department, oil carried y independent companies => maritime department limited to commercial activities

International and national maritime organisations

International Maritime Organization (IMO)

European Maritime Safety Agency (EMSA)

Created after Erika disaster Contribute to enhancement of overall maritime safety system Goals: reduce risk of maritime accidents, marine pollution and loss of human lives Agency provides technical and scientific advice in field of maritime safety and prevention of pollution Continuous process of updating and developing new legislation, monitoring its implementation and evaluating effectiveness of measures in place Key areas: o Strengthening of Port State Control regime o Auditing Community-recognized classification societies o Development of common methodology for investigation of maritime accidents o Establishment vessel traffic monitoring and information system Activities o Safety assessments and inspections o Ship safety o Environment, training and statistics o Pollution preparedness and response, vessel traffic and reporting services o Satellite based monitoring services

Classification Societies and IACS

The Classification Societies Development and implementation of technical standards for protection of life, property and environment Technical requirements for design, construction and survey of ships and offshore structures => classification rules Significant research departments Contribute to structural strength and integrity of essential parts of ships hull and appendages and reliability and function of propulsion and steering systems, power generation and other features and auxiliary systems Not guarantors of safety of life or property at sea or seaworthiness of a vessel => no control how a vessel is operated and maintained between periodic surveys Owner of ship may apply for certificate of classification => ships has to comply with rules Surveys carried out by qualified surveyors using mainly visual inspection and sampling techniques Ship maintained in class: o Presented for surveys in accordance with rules o Surveys confirm condition of hull, machinery, equipment and certain appliances remain in compliance with rules Doesnt design, build, own, operate, manage, maintain, repair, finance, insure or charter ships May also act as Recognized Organizations for Flag States

IACS International Association of Classification Societies Gathering of 10 classification societies Unique contribution to maritime safety and regulation through technical support, compliance verification and research and development More than 90 % worlds cargo carrying tonnage covered by classification design, construction and through-life compliance Rules and standards set by the ten Member Societies and one Associate IACS The members o ABS = American Bureau of Shipping o BV = Bureau Veritas o CCS = China Classification Society o DNV = Det Norske Veritas o GL = Germanischer Lloyd o KR = Korean Register of Shipping o LR = Lloyds Register o NK = Nippon Kaiji Kyokai o RINA = Registro Italiano Navale o RS = Russian Maritime Register of Shipping Ngo allowed to develop guidance and advise for IMO

International Telecommunication Unit (ITU)

Leading United Nations agency for information and communication technology issues and global focal point for governments and private sector for developing networks and services Coordinated shared global use of radio spectrum, promoted international cooperation in assigning satellite orbits, worked to improve telecommunication infrastructure, established worldwide standards and addressed global challenges such as mitigating climate change and strengthening cyber security

Royal Belgian Ship owners Association (RBSA)

Proactively looks after common interests of all ship owners and ships managers established in Belgium and involved in international maritime transport Dynamic role in promoting sector as attractive employer Gives members operational support and clarification concerning fiscal, social and maritime legislation Collaborates closely with all relevant national and international parties Statistics o 149 ships carried Belgian flag o Representing 4 017 427 GT o Average age end 2008 11,6 years o Weighted average was 8,1 o 25 new-build projects announced for delivery in period 2009 - 2011

Professional associations
Koninklijk Belgisch Zeemanscollege / College Royal Maritime Belge Gathers Belgian and Luxembourg officers in possession of STCW certificate and students of Antwerp Maritime Academy Provide information concerning new maritime regulations, evolutions on technical side, important maritime events, interesting seminars, jobs

The Royal Belgian Institute of Marine Engineers (Gallois Genootschap) Study-circle for ship engineers and technicians in ship building industry, ship mechanics and related sectors for everybody interested in branch of industry Main goal: inform members about evolution in technological areas as well as practical knowledge Realised by lectures, publication of bi-monthly magazine, organisation visits

Harbour formalities
Harbour formalities on arrival
Limits of harbour Determine where pilot must board Determine when ship is arrived

Anchorage areas Important if ship carries dangerous goods and required to anchor in isolated place Restrictions Entering at night or in accordance with tide or draught Plan voyage that ship can enter when tide allows with minimal delays

Maximum dimensions Locks Often cause of delays or extra damage

Tugs Number and power available tugs Mandatory number Place where tugs have to be moored and which line Pilot usually gives enough information Inquire about price of tug service in advance

Mooring berths Length of quays, depth alongside, maximum draught at low water, available loading and discharging installations, number of sheds, hangars or terminals Bridges Times Tolerances regarding width and height

Pilotage Mandatory? How to contact? How many hours before arrival transmit ETA? VHF frequencies? How identify pilot boat? Signals? Where is the station located? Under what circumstances pilotage suspended? Actions when pilotage is interrupted? Shore radar service assistance possible?

Radio stations Frequency and call sign allows to transmit ETA or contact agent

Formalities on arrival Practical arrangements o Ordering pilot o Contact agent Berthing prospects Necessary measures regarding discharging and loading operations of the ship Arrangements regarding maintenance or repairs Matters concerning crew Provisions Bunkers Drinking water o Prepare administrative and commercial documents (6 categories) Documents for harbour authorities Documents for immigration Documents for health service Documents for customs Documents for the agent and stevedore Documents for the consul See p. 99 - 101

Harbour formalities on departure

Crew See p. 102 - 103 On the bridge See p. 103 - 104 Ships provisions See p. 104 Cargo Check watertightness of holds, tanks and other cargo spaces Proper statement of every complaint receiver could make Ship must be seaworthy => delegate crew to run a check Deliver goods carrying to receiver in same apparent good order and condition Search for drugs in vessel and cargo

Documents All necessary documents should be on board and still valid