Chartering Basics in Shipping

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10 Questions

Who is the person or entity that hires the ship or its cargo space for transportation?

Charter broker

What does a competitive broker do in chartering negotiations?

Facilitates negotiations between multiple parties

Which type of cargo can be unitized, such as containerized?

Dry cargo

What resources are recommended to check in the video series description for additional information?

Comprehensive lecture slides and ICS papers

What is the main purpose of Co EE (Contract of Affreightment)?

To agree on the transportation of cargo over a specific period

What is the primary factor used to classify ship sizes?

Deadweight Tonnage (DWT)

In shipping, which charter type provides flexibility for the ship owner to use different vessels for consecutive voyages?

Consecutive voyages

What are the major types of fuel oil used in shipping?


Which charter type involves the vessel hire for a specific period with variable costs borne by the charter?

Time charter

What is the primary purpose of cost estimation in shipping?

To calculate the net revenue, profits, or losses of a shipping venture

Study Notes

  • Akash from ShipScope is presenting a video series on chartering basics.
  • Topics covered will be dry cargo chartering, tanker chartering, and ICS exam preparation.
  • Subscribing to the channel and checking the description below for additional resources is recommended.
  • Comprehensive lecture slides, ICS papers, past question papers, and lecture notes are available on Akash's website.
  • The video series aims to help both newcomers and those preparing for ICS exams understand chartering concepts.- The text is about chartering in shipping, focusing on players involved and cost components.
  • Players in chartering: Ship owner, charter, ship broker, and freight forwarder/ship agent.
  • Ship owner: Person or entity that owns the ship and hires it out to charters.
  • Charter: Person or entity that hires the ship or its cargo space for transportation.
  • Ship broker: Middleman who connects ship owners and charters to earn brokerage.
  • Types of charter brokers: Owners broker, charter broker, or competitive broker.
  • Owners broker: Represents ship owners in negotiations, ensures their interests are prioritized.
  • Charter broker: Represents charters in negotiations, ensures their interests are protected.
  • Competitive broker: Facilitates negotiations between multiple parties, earns commission.
  • Ship types and cargo: Dry cargo, tankers, LNG, chemicals, vegetable oils, etc.
  • Dry cargo: Unitized (e.g., containerized), or loose (bulk).
  • Dry cargo ship sizes: Handy size (20-40,000 DWT), Handy max (40-50,000 DWT), Supra (50-80,000 DWT), Panamax (60-125,000 DWT), Post-Panamax (125-220,000+ DWT).
  • Fuel costs: Major expense in shipping, with fuel oil types like VLSFO, SFO, MGO, IFO.
  • Voyage costs: Incurred when a ship undertakes a specific voyage, borne by the ship owner.
  • Periodic costs: Cover periodic inspections, maintenance, and repairs, borne by the ship owner.
  • Cargo handling costs: Costs for cargo loading, turning, and discharge, borne by the charter.
  • Charter types: Void charter (one-time voyage), time charter (vessel hire for a period), and consecutive voyages (multiple voyages in sequence).
  • Void charter: One-time voyage, all costs borne by the ship owner.
  • Time charter: Vessel hire for a specific period, variable costs borne by the charter.
  • Bareboat charter: Long-term charter, Charter has the option to buy the vessel after a certain period.
  • Consecutive voyages: Multiple voyages in sequence, flexibility for the ship owner to use different vessels.
  • Co EE (Contract of Affreightment): Agreement between ship owner and charter for the transportation of a cargo over a specific period.
  • Co PVC: Capital, operating, periodic, voyage, and cargo handling costs in shipping.
  • Cost components: Capital costs (vessel purchase, insurance), operating costs (crew wages, supplies, maintenance), periodic costs (inspections, repairs), voyage costs (fuel, port fees), cargo handling costs.
  • Ship sizes: Classified based on DWT (Deadweight Tonnage), with smaller vessels used for refined products and larger vessels for crude oil and bulk cargo.
  • Cost estimation: Understood to calculate net revenue, profits, or losses of a shipping venture by considering key cost components.

This quiz covers the fundamental concepts of chartering in the shipping industry, including the players involved, different types of charters, cargo handling costs, cost components, and ship sizes. It is beneficial for newcomers and those preparing for ICS exams.

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