The Bulk Cargo requires shipping services in which large quantity of one type of cargo can be carried at low per unit cost. These services are provided by carriers known as Tramps. Quite naturally, there are different types of tramp ships to carry different kinds of bulk cargo.
On the other hand, carriers which provide regular and scheduled shipping services to carry heterogeneous cargo suiting the marketing requirements of General Cargo are known as Liners. A liner ship is built and run to satisfy the transport demand of a variety of cargos. Let us now discuss them in detail.
Cargo ships fall into two further categories that reflect the service they offer to the industry. These are Liner & Tramp services.
- Cargo liner runs on fixed schedules & fixed tariff published by the shipping companies
- Each trip a liner takes is called voyage
- Liner mostly carry a general cargo
- Some liner cargo also carry passengers
- A cargo liner that carriers 12 or more passengers is called a combination or passenger-cum-cargo liner
- It is an organization whereby a number of ship owners offer their services on a given sea route on the conditions agreed by the members.
- This kind of association is formed to restrict the competition amongst members & also protecting them from outside competition.
- Conference agreements also regulate sailing & ports of calls. Their chief policy is to achieve a common tariff of freight rates for the traders.
- The shipping companies belonging to the conference held a regular meeting to decide freight rates & discuss other related issues.
- The origin of the conference is basically as a result of cut throat competition among the shipping companies.
Advantages of Line conference:
- Avoidance of wasteful competition
- Stability of rates which enables merchants to make forward contracts for goods & so diminishes undesirable risk & uncertainty in International Trade.
- Regular & Frequent sailings, this helps merchants to plan their shipments in advance.
- Equality of treatment. Freight is same for big & small.
- Coverage of wide range of ports.
- The elimination of price competition leads to service competition among the members, updated equipment of cargo handling & office organization.
- Tramp carrier is primarily designed to carry the more simple and homogeneous cargo in huge quantity. It is, therefore, designed to completely utilize its carrying capacity for carriage of one type of cargo.
- Tramp ships do not have fixed schedules.
- Sailing based on cargo available.
- No expected repetition.
- Freight rates vary according to the demand & supply
- Generally, operated by small shipping companies & private individuals.
- Voyage charter:
- Here, ships are chartered for a specific voyage. Normally, traders prefer voyage chartering
- Time charter:
- Here, ships are chartered for a specific period. The charterer may employ the ship in his voyage according to his requirement.
- Demise charter:
- It is an arrangement for the chartering or hiring of a ship or boat, whereby no crew or provisions are included as part of the agreement; instead, the people who rent the vessel from the owner are responsible for taking care of such things.
Difference between Liner & Tramp Shipping
|Liner Shipping||Tramp Shipping|
|1. Regular sailing on predetermined routes||1. Sailing based on cargo available|
|2. Repetition of voyages & advertising for the same||2 No expected repetition. Each ship scheduled individually.|
|3. Cargo usually is varied. Either containerized or Non-containerized||3 Normally, a full ship is loaded with a single commodity|
|4. Cargo normally is of higher value & one charged higher rates.||4 Have low intrinsic value. These goods can be transported in bulk.|
|5. Because of a variety of cargo, it is supposed to be delivered at a different port.||5 Here movement of the goods is from single port of loading to single port of discharge.|
|6. Freight rates are stabilized||6 Freight rates varies with demand and supply situation|