The foundation of shipping market stands on four pillars: freight, new build, second hand and demolition markets, each of them are interrelated. The instability of tanker freight earnings impact from other arcades. Companies generating revenues from hiring their vessel in bareboat charter, voyage charter, time charter and consecutive voyages charter. The other capital taken out from selling old ship while unstable market and economic downturn useful to recover from knock-on effect of market.
The tanker shipping industry interconnected with four major markets. Sea transport services are dealt in the freight market, new ships are ordered and built in the new building market, used ships are traded in the sale and purchase market, and old or obsolete ships are scrapped in the demolition market. Correlation analysis is conducted to illustrate the linkage among these four interrelated shipping markets. Shipping cash flow normally circulate from Loans, Mortgages, freight earnings, investments, and reinvestments of cash in and cash out of tanker asset values. The research variables involved are
a)Freight rate, the value that carriers are willing to accept and shippers are willing to pay for sea transport services;
b)New building ship price, the value that ship builders are willing to accept and ship owners are willing to pay to buy new ships;
c)Second-hand ship price, the value that ship owners are willing to pay and accept to trade used ships in the sales and purchase market;
d)Demolition ship price, the value that scrappers are willing to pay and ship owners are willing to accept to scrap old ships.
According to Stopford (2009), he explain ship owning companies trade in four different markets.
i.The newbuilding market where he order the ship;
ii.The freight market where he chartered them;
iii.The sale and purchase market where he tried to sell the combined carriers; and
iv.The demolition market where he finally sold them.
FAQs
The international shipping industry can be divided into four closely related shipping markets, each trading in a different commodity: the freight market, the sale and purchase market, the newbuilding market and the demolition market.
What are the segments of the shipping industry? ›
The shipping industry can be divided into four main segments: dry bulk, liquid bulk, container, and specialized. Each segment has its own characteristics, drivers, and challenges, and requires different types of vessels, ports, and infrastructure.
What is shipping economics? ›
In general, maritime economics explains how the shipping market is organized and works, including reasons for sea transport, organization of sea transport, prices and freight rates determination, ship finance, market cycles, shipping companies return on investment, how shipping company survive depressions, drivers in ...
What is the size of the maritime shipping industry market? ›
Maritime Freight Transport Market Size
| Study Period | 2019 - 2029 |
|---|
| Market Size (2024) | USD 381.69 Billion |
| Market Size (2029) | USD 471.81 Billion |
| CAGR (2024 - 2029) | 4.33 % |
| Fastest Growing Market | Asia Pacific |
2 more rowsThe four stages of the shipping cycle, all based on customer demand, are trough, recovery, peak and collapse.
What are the 4 pillars of shipping? ›
The four pillars of the International Maritime Organization are as follows:
- Safety of Life at Sea (SOLAS)
- Standards of Training, Certification, and Watchkeeping (STCW)
- The International Convention for Pollution Prevention from Ships (MARPOL)
- Maritime Labour Convention (MLC)
Now that we know where the bow, stern, port and starboard are located, let's learn some more important boating terms.
What are the segments of delivery market? ›
Global Online Food Delivery Services Market is segmented by type into Restaurant to Consumer and Platform to Consumer. Platform to Consumer segment held the largest market share in the year 2020.
What are the segments of the truck market? ›
The trucking industry can be segmented in several ways, including by the type of carrier, type of freight being transported, size of the load, the distance the truck travels, and the type of trailer and vehicle used. The trucking industry's importance to the U.S. economy can't be understated.
Why is the seaborne trade important? ›
The international shipping industry is responsible for the carriage of around 90% of world trade. Shipping is the life blood of the global economy. Without shipping, intercontinental trade, the bulk transport of raw materials, and the import/export of affordable food and manufactured goods would simply not be possible.
Five types of shipping options for companies
- Ground Shipping. Considered the most common method, ground shipping is a reliable and cost-effective option to move packages and goods within a country or region through several carriers such as FedEx, UPS, and USPS. ...
- Air Freight. ...
- Ocean Freight. ...
- Rail Shipping. ...
- Intermodal Shipping.
On the other hand, economy services refer to the cheapest available shipping rates via trains and trucks. The main difference between the two is economy services refers to the cheapest available rates, though prices are similar between economy vs. ground shipping.
What is the biggest trade ship? ›
MSC Irina, is the world's largest container ship with a capacity of 24,346 TEUs. Sailing under the Liberian flag, it measures 399.9 meters in length and 61.3 meters in width. This giant ship is the first of six built by the Chinese Jiangsu Yangzijiang Shipbuilding Group.
Who has the biggest shipping industry? ›
1. Maersk. The Danish company Maersk ranks first in the list of 15 largest shipping companies in the world. It is the largest shipping company in the world since 1996 and it looks like it has no intention of giving up its crown as its throughput surpassed 4 million TEU in 2020.
What is the shipping industry called? ›
The Maritime Industry is much more than the deep-sea merchant fleet.
What are the 4 P's of marketing transportation? ›
The 4 P's of marketing are price, promotion, place, and product—the four key factors every marketer should use to guide their campaign strategy. Our guide covers the 4 P's of marketing and gives a breakdown of each step involved. Product, price, place, and promotion.
What are the three main shipping companies? ›
List of largest container shipping companies
| Rank | Company name | Ships |
|---|
| 1 | Mediterranean Shipping Company (MSC) | 801 |
| 2 | Maersk | 685 |
| 3 | CMA CGM | 634 |
| 4 | COSCO Shipping Lines (COSCO) | 491 |
26 more rowsThe market in the Asia Pacific accounted for the largest marine vessel market share in 2023. It is likely the fastest-growing region during the forecast period due to China, Japan, and South Korea's increased marine fleet.
What are the three types of shipping? ›
There are different types of freight transportation. Freight, or goods and cargo for shipment, can be transported by air, sea, or land. Choosing the right type for your business is essential to ensure convenient, timely, and accurate delivery of your goods.
