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Some questions on Shpping - Essay Example

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A1) Shipping is one of the key facilitators of international trade in today's global market. And even though the word shipping is often associated with ocean transport, shipping actually means the transport of goods across distances.
With shipping, the distance between the manufacturer and the importer reduces…
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Some questions on Shpping
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Download file to see previous pages This has made possible the process of 'outsourcing' reach new levels. Now many countries where the manufacturing costs are high have outsourced the manufacture to countries where the cost is relatively low and then re-imported back into the country.
And with freight rates being relatively low, now companies source raw materials from one country, export it to another country where it is processed and finally sold in another country. This has caused the international trade to increase from 0.55bt in 1950 to 4.3bt in 1995 an 8-fold increase.
For the transport of crude oil we would use a Crude Oil Tanker such as a ULCC with a capacity of up to 500,000t DWT since we want to transport as much crude oil in a single journey as possible due to high demands.
For the transport of grains, we would use a Dry Bulk Cargo ship such as the handymax or the panamax. They are the most economical to build, and therefore the freight rates offered would be low allowing for the commodities to be traded at economical rates.
For the domestic air-conditioners, we would use a container ship. ...
For the transport of iron ore we can also use a Dry Bulk Cargo ship but with a much higher DWT such as those found on the Capesize.
For the domestic air-conditioners, we would use a container ship. The advantage offered would be that transport costs would be low; the goods can safely stored on board the ship and can easily and quickly be loaded and discharged.
3) How is the simplicity of design of the dry bulk carrier relevant to the fact that it carries law value cargo
A3) Dry Bulk carriers mostly transport cargoes of low value which would have very few specialised needs. This would mean that the design of the Dry Bulk carrier would not require many special additions as compared to other ships which carry specialised cargoes such Crude Oil Tankers or Reefers. This would translate into lower costs in terms of manufacturing, which would mean lower investments for the ship owners. This advantage would be seen in that; the freight rate of a Dry Bulk Carrier would be a lot lower as compared to a Tanker. And since most of the cargoes transported by these ships are of low values that would mean that the profits would not be as high and therefore the need to transport the goods at economical costs.
4) What are "flags of convenience" How have they changed over the last decades How have classification societies and IACS influenced their developments
A4) 'Flags of convenience' is when a ship is registered in one country but is owned by a party present in another country. Under international maritime laws, the country where a ship is registered in determines the regulations to be applied upon the ship irrespective of the country of origin of the ship's owner.
As many countries have become stricter and labour costs have risen, many ship owners register their ships in ...Download file to see next pagesRead More
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