Curriculum Structure

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MT3006 Ship Chartering

[Lecture: 26 hr ; Tutorial: 13 hr ; Lab: 0 hr ; Pre-requisite: Nil ; Academic Unit: 3.0 ]


Learning Objective :

To familiarize the students with the shipping markets, including the freight market and cargo markets. They will know how the freight rates are set and the factors on which world trade relies and they will be able to perform freight calculations and use different charter parties.

Course Content :

Operation of freight markets and chartering in ocean going shipping. Basic types of freight markets (dry cargo – tankers). Function of market. Factors determining the freight rate. Shipping marketing. Charter parties. Types of chartering. Freight calculations. Special calculations: mixed time and voyage charter and marginal calculations. Marginal calculations in the liner market. Time charter calculations. Tanker calculations. The Worldscale index establishment. The connection of freight to the cost and supply of shipping services. Distribution of risk in freight fluctuations. Use of future charter parties. Rate of shipping return.

Course Outline :

S/N

Topic

1

INCOTERMS 2000; Trade payment methods; Shipping terms

2

Shipping Costs; Types of Charters – Cost Implications

3

Generic Freight Calculations; Discounted Cashflow Methods

4

Profitability Analysis; Capital Budgeting Methods

5

Choice of Ship Type; Market Segmentation; Market Participants

6

Freight Indices – Type and assessment of routes; Specific voyage estimation – Oil trade

7

Specific voyage estimation - Liner trade; Specific voyage estimation – Bulk trade

8

Components of a voyage charter

9

Technicalities in Charter Parties; Laytime and demurrage calculation

10

Types of contracts; Purpose of contracts

11

Construction of Contracts

12

Freight derivatives; Hedging

13

Portfolio Management

Learning Outcome :

Upon completion of the course, students should be able to analyze the freight markets and understand the implications of politics and world trade. They will be able to understand the complex structure of world trade and the factors determining the ups and downs of particular trades.

Textbooks :

Nil

References :

  1. Stopford, M. 2009, Maritime economics, 3rd edition, Routledge Publication.