1. Explain in your own words what the 4 shipping markets are, find and discuss the correlation between the markets and the short shipping cycles.
The 4 shipping markets
We can look back in the 19th century and determine the definition of the ‘market’, as an economist defined it. “Originally a market was a public place in a town where provisions and other objects were exposed for sale; but the word has been generalised, so as to mean anybody of persons who are in intimate business relations and carry on extensive transactions in any commodity. A great city may contain as many markets as there are important branches of trade, and these markets may or may not be localised. The central point of a market is the public exchange, —mart or auction …show more content…
This charter supports shipment between two ports for a set price per ton. The terms of the agreement, between the investor and the owner, will be displayed in a charter-party, in which rates for demurrage, if something goes wrong and it is the owner’s fault, and despatch, if there is a problem caused from the charterer, are involved in dollars per day.
b) The contract of affreightment. The ship-owner agrees to carry a series of cargo parcels for a fixed price per ton. This enables the ship-owner to prepare in advance for the best use of his ships.
c) The time charter. It is a charter, where the ownership and the management of the vessel remain to the ship-owner. This charter can be either a trip charter, in order to complete a single voyage, or a period charter, in order to complete a period of months or years voyage. The ship-owner pays all the operating costs, such as the crew salaries, the maintenance and the repairs of the vessel, while the investor manages the cargo-handling costs, the commercial operations and pays the voyage expenses, such as bunkers, canal dues and port …show more content…
The Closing. The vessel is brought to the new owner and he completes the transaction, with the money transfer to the previous ship-owner’s bank account.
The value of a used vessel is closely correlated to several factors, such as:
A. Freight Rates, that rates are the most important aspect that affects the prices of used vessels. According to past analysis, when freight rates are in the peak then the price of the used vessel may be 4-6 times over its yearly earnings.
B. Age. According to brokers, the used vessels lose 5-6% of their value every year. A 5-year-ship worth more than a ship with the double years.
C. Inflation influence the ship prices. That means, that a ship will come into the market at a starting price, after some years that price might fall, then it might raise a lot, then stay at the same level for some years and after that to reach the peak of its price.
D. Expectations. The buyers or sellers may at first look close to the market, to see what may occur in the market, and then suddenly they make their move to buy and sell when the market is rising.
(Stopford, 2009).
The Demolition
The 4 shipping markets
We can look back in the 19th century and determine the definition of the ‘market’, as an economist defined it. “Originally a market was a public place in a town where provisions and other objects were exposed for sale; but the word has been generalised, so as to mean anybody of persons who are in intimate business relations and carry on extensive transactions in any commodity. A great city may contain as many markets as there are important branches of trade, and these markets may or may not be localised. The central point of a market is the public exchange, —mart or auction …show more content…
This charter supports shipment between two ports for a set price per ton. The terms of the agreement, between the investor and the owner, will be displayed in a charter-party, in which rates for demurrage, if something goes wrong and it is the owner’s fault, and despatch, if there is a problem caused from the charterer, are involved in dollars per day.
b) The contract of affreightment. The ship-owner agrees to carry a series of cargo parcels for a fixed price per ton. This enables the ship-owner to prepare in advance for the best use of his ships.
c) The time charter. It is a charter, where the ownership and the management of the vessel remain to the ship-owner. This charter can be either a trip charter, in order to complete a single voyage, or a period charter, in order to complete a period of months or years voyage. The ship-owner pays all the operating costs, such as the crew salaries, the maintenance and the repairs of the vessel, while the investor manages the cargo-handling costs, the commercial operations and pays the voyage expenses, such as bunkers, canal dues and port …show more content…
The Closing. The vessel is brought to the new owner and he completes the transaction, with the money transfer to the previous ship-owner’s bank account.
The value of a used vessel is closely correlated to several factors, such as:
A. Freight Rates, that rates are the most important aspect that affects the prices of used vessels. According to past analysis, when freight rates are in the peak then the price of the used vessel may be 4-6 times over its yearly earnings.
B. Age. According to brokers, the used vessels lose 5-6% of their value every year. A 5-year-ship worth more than a ship with the double years.
C. Inflation influence the ship prices. That means, that a ship will come into the market at a starting price, after some years that price might fall, then it might raise a lot, then stay at the same level for some years and after that to reach the peak of its price.
D. Expectations. The buyers or sellers may at first look close to the market, to see what may occur in the market, and then suddenly they make their move to buy and sell when the market is rising.
(Stopford, 2009).
The Demolition