September 5, 2008

Each ship type is to a high degree built with particular products, service functions and trade patterns in mind. This is to make the performance of services and the transport of products on the individual trade lanes as efficient as possible.  

The major product groups are liquid bulk , dry bulk , containers , vehicles and passengers. In addition there are a large number of vessels which perform services rather than transporting products.

The principal types of merchant vessels belong to the groups of tanker vessels, dry bulk vessels, container ships, Ro-Ro vessels.
Apart from passenger and cruise vessels,
offshore vessels and the principal groups of merchant vessels, there are a great number of lesser known vessel groups. These include e.g. heavy lift vessels, floating cranes, livestock carriers, multi-purpose vessels, fishing vessels, icebreakers, dredgers, tugs and pilot/rescue vessels.


Tanker Ship

September 5, 2008

The most common tanker ships are the crude oil tankers and the product tankers, which carry crude oil and refined oil products, respectively. In addition there are chemical tankers, gas tankers (LPG and LNG) along with numerous other lesser known tanker types.  

The common denominator for all tankers is that they carry liquid substances in large bulk quantities.  

Depending on ship type they may be able to carry other liquids than the ones the ship type is specifically build for. Thus there is a much larger substitution within the group of tankers than e.g. between the group of tankers and the group of dry bulk ships. This implies that the earnings are highly correlated between the different tanker types and segments. 

For instance the product tanker may carry crude oil but the crude oil tanker cannot necessarily carry refined oil products since these oil products may require the tanks to be coated which the tanks of the crude oil tanker are not.   

The chemical tanker may carry oil products but the product tankers cannot carry chemicals since these chemical products require special storage facilities and security procedures. 

The LPG tanker may carry clean petroleum products but the product tanker can not carry liquefied gasses.  

The substitution among tankers is to some extent constrained by the vetting procedure of the oil companies and by the costs of cleaning the tanks when changing the type of liquid carried in the tanks. Thus the tankers do sometimes change employment pattern, but only when the difference in freight rates is great enough to cover the costs associated with the chang

Dry Bulk Carrier

September 5, 2008

Dry bulk carriers transport large volume cargoes in ship loads. Major dry bulk commodities consist of industrial raw materials including iron ore, coal, grain, bauxite and alumina. Minor bulks such as soya beans/meal, steel products, phosphate rocks and sulphur also accounts for a significant part of the dry bulk trade. 

Dry bulk carriers are generally designed for simplicity and cheapness. However some of the small vessels are of higher technical designs in order to trade special cargoes such as cements and rocks. These vessels are somewhat similar to multipurpose vessels in both size and design.  

The ownership of dry bulk tonnage is highly dispersed compared to the ownership of crude oil tankers, chemical tankers and containerships. 

The dry cargo market is a large mixture of spot arrangements, time-charter agreements and industrial shipping.

Container Ship

September 5, 2008

The fleet of container ships is one of the fastest growing fleets of all ship types. Particularly two factors have been influential in producing the high growth in transport of container:

– Ever expanding free trade agreements and continued reductions of other barriers to trade have in particular benefited growth in commodities carried in containers.  

– Products that historically used to be moved in pallets or bulk quantities are at an increasing ratio being shipped in containers instead. This include liquid chemicals, cement, corn, cars, etc.. 

Less visible, but nevertheless influential, is the fact that growing numbers of containers enable ever larger and faster ships with ever lower marginal costs. The lower transport costs and faster transport times enable the global trade in products, which otherwise would have been unable to trade.

Ro-Ro Ships

September 5, 2008

Ro-Ro is the common description of vessels that transport rolling cargo (Roll-On Roll-Off). The fleet can be divided into two main segments: Pure car and truck carriers (PCC and PCTC and other Ro-Ro vessels.

Crude Oil Tankers

September 5, 2008

Crude oils are not all alike. They differ considerably in their physical properties of particularly their viscosity, sulfur content, metals content and the proportions of the various hydrocarbon fractions that can be turned into the different end products. These properties affect the ease with which the refineries can process various crude oils into the different products required by the consumers. 

The refineries are interested in a crude oil for the value of the products it yields. The aim is to turn the crude oil into as much of the lighter, higher priced products and as little of the heavier, lower priced products as is cost-effectively possible. Thus the crude oils that are naturally ‘light’ have a higher price than the crude oils which are naturally ‘heavy’.  

The different crude oils are graded by their density or specific gravity and assigned an API gravity. The higher the API gravity the lighter the compound.  

The U.S. Department of Energy labels the crude and petroleum products with a API gravity of 20 degrees or less as ‘heavy’, and petroleum products with a API gravity of 40.1 degrees or greater as ‘light’. The crude and petroleum products in between 20 and 40.1 degrees are labeled as ‘intermediate’. 

The EU and IMO have a slightly different definition of ‘heavy’. Their cutoff between ‘heavy’ and ‘intermediate’ lies at 25.7 API gravity, meaning that more crude oil types fall under the ‘heavy’ definition of EU and IMO.  

The IMO definition is particularly noteworthy since this is the definition that defines the products which the non-double-hull tankers are not allowed to transport as of April 2005.  

The EU has already adopted stricter regulations on the carriage of heavy oils in non-double-hull tankers in EU waters.  

The different crude oils are also graded by their content of sulfur. A low sulfur crude oil is ‘sweet’, and a high sulfur crude oil is ‘sour’. Sulfur is a pollutant and its level in finished products is increasingly being limited in both the U.S. and the EU.  

Together the two main characteristics, the API gravity and the sulfur content, are significant factors in explaining the price level and trade pattern of a particular crude oil.

The crude oil tankers are distinguished according to their size.

The size of tankers is usually measured in dwt.

The four most common crude segments are the VLCC/ULCC, Suezmax, Aframax and Panamax.LCC

The Very Large Crude Carrier (VLCC) is only superseded in size by the Ultra Large Crude Carrier (ULCC). The number of ULCC tankers is very limited (11 ships) and has been declining.

The VLCC/ULCCs are predominantly employed on the long voyages between the Middle Eastern countries and the USA or the Asian countries. The VLCC/ULCCs are to a large degree limited from being employed on the short intra-regional voyages because the sheer size of the tanker usually prevents it from entering the small harbors with depth and length restrictions. On short haul voyages where the demand at the destination is rather limited it is much more efficient to ship small cargo sizes thus avoiding long periods of time along the quay and avoiding investing in large storage facilities at the destination.

The Product Tankers

September 5, 2008

These are distinguished according to their size. The size of tankers is usually measured in dwt.  The three most common product segments are the LR2-, LR1- and MR segments. The LR2 segment is the segments, which holds the largest product tankers.  When carrying clean products these ships usually trade on the long voyages out of the Middle East to the Asian countries and Northern Europe.  When carrying dirty products these ships usually trade on the long and medium voyages out of the Black Sea to the Mediterranean and the US and out of the Baltic and North Sea to Northern Europe and the US.