SHIPPING INDUSTRY

Shipping Industry



Shipping Industry

Overview

Shipping industry is considered to be the backbone when it comes to trade. Approximately 90% of the world trade is carried by the shipping industry worldwide. Today if we do not have shipping industry, imports and exports of goods would not be possible according to the necessary scale for the modern world (Merge Global, 73). It is beneficial for all the traders around the globe; it is continuously expanding and benefiting consumers across the world through freight costs. Economic liberalization is the main cause for the growth of the shipping industry. Day by day shipping is becoming stronger mode of transport through globalization, as every country in connected with another country. About 50,000 merchant ships are operating worldwide, transporting different cargo. Fleets of ships are registered in over 150 countries, and ships are manned by over a million seafarers. These seafarers belong to almost every nationality.The Container Shipping Market

Shipping industry is expanding day by day. If we look at the growth in the shipping market, container shipping market grows relatively more than tankers and bulk carriers. As trade is increasing day by day, demand for shipping is increasing continuously. During 1999 to 2008, the demand for world container trade grew at an annual rate of 10 percent. As there were global economic downturn in 2009, the world container trade declined by 10 percent to 124 million TEU, the first yearly decline on record (World Shipping Council, 8). After the global economic downturn, the container shipping industry rebounded in 2010. After economic fuelling, this upward trend will continue in 2011. The growth demand for containership is estimated to be 10 percent, which is more than the estimated growth of containership capacity i.e. of 8 percent. Many researchers believe that some economies of the world are not performing well, still the positive trend for the shipping industry

continues in 2011.

The Charter Market

Liner companies operating container shipping services owned the biggest share of world's containership capacity. In past few years, liner companies have decided to charter a larger proportion of the capacity they operate, associating significant costs with purchasing vessels. The share of the total capacity of the top 10 liner companies increased from 15 percent in 1993 to 50 percent in 2010 (Rickymers, 5). As liner companies decrease their reliance on ship owners for capacity, the containership deliveries may decrease in the next few years. However, the growing economy of the world indicates the upturn in the charter market to strengthen along with global market.Containers

If we look at container shipping, it is different from standard shipping because container ships use “containers” of different sizes to load goods. Containers can be of 20 foot, 40 foot, 45 foot, 48 foot and 53 foot, these containers were used to load, unload and transport goods. These containers can be moved easily between ships, trains and trucks. 20 foot and 40 foot containers are used most frequently nowadays for trading of goods. 20 foot TEU (twenty foot equivalent unit) no referred as the industry standard now vessel capacity, and cargo volume are measured in ...