Essay: Container Ships And Operations - Overview" (52 Characters)

This report intends to provide an overview of the various container ships and their areas of operation. The report also provides a rough overview of the various owners of these ships as well as the types of charter parties. The report also provides a detailed analysis of the condition of the freight market and the profitability or the loss of the business in the present times. Lastly, the report, concludes with a future forecast of the fate, which awaits these container ships in the near future.

Major areas of operation

Container ships are the cargo ships, which are used for the purposes of transporting goods as well as other cargo materials from one part to another via the sea route (Baughen 2012). The speciality of these ships is the fact that they carry loads from one place to another in the form of truck sized intermodal containers, in a technique commonly known by the name of containerization (Baughen 2012). These ships are the most commonly used means of intermodal freight transport. They are also the most commonly used means of seagoing non-bulk cargo transport. The capacity of the container ships is usually measured in terms of twenty-foot equivalent units (TEU) (Rogers Chuah and Dockray 2016). It is interesting to note, that about 90% of the total non-bulk cargo from all over the world is transported by these container ships from different parts of the world (Rogers Chuah and Dockray 2016). One time, the popularity of these container ships was so much that they even rivaled the crude oil tankers as well as other forms of bulk transport forms. Traditionally these ships were used by the various countries as well as individuals to transport large quantities of goods as well as products from one part of the world to another. Some of the famous container ships of the world are listed below-

• OOCL Hong Kong
• Madrid Maersk
• MOL Triumph
• MSC Anna
• MSC OSCAR
• CSCL Globe- MV CSCL
• Barzan(UASC)
• Magleby Maersk

The major area of operation of these container ships is in the transport industry, wherein they are used to transport huge bulks of materials from one place to another via the sea-route . According to Rogers Chuah and Dockray (2016), about 90% of the total non-bulk materials from different parts of the world, is transported to their desired location by these container ships. It is a reflection of the services, provided by these container ships that they at one time even rivaled the transport services offered by the bulk carriers as well as the crude oil tankers. The offer easy as well as reliable means of transport in the various sea routes and therefore their  services are often sought by some of the major governmental as well as private organizations and companies of the world.

It is seen that the majority of the container ships are mostly government owned. However there are some private individuals as well as private organizations, which own some of the major container ships of the world in business today. For example, the Danish company, A.P. Møller-Maersk owns the container ship Maersk Line (www.maerskline.com, 2018), whereas the CMA CGM Group is the owner of the container ship CMA CGM – 1.55m TEU(Cma-cgm.com, 2018). The company American President Lines (APL), is the owner of the container ship Hapag-Lloyd – 1m TEU(Hapag-lloyd.com, 2018).

Major owners

A charter party can be defined as a maritime contract between the charterer and the ship owner for the process of hire of the ship for the purposes of carrying the passengers as well as cargoes from one place to another (Rogers Chuah and Dockray 2016). There are two types of charter party contracts-time charter and bareboat or demise charter (Rogers Chuah and Dockray 2016). Time charter can be defined as the charter wherein a charter is hired for a stipulated period of time. The owner of the ship stills manages the ship but the charter provides orders for the employment of the vessel. (Cooke et al. 2014). In the case of bareboat charter, the charterer takes the responsibility of the management as well as the employment of the vessel for the purposes of commercial use (Cooke et al. 2014).

Freight, can be defined, as the reward payable to the carrier for the safe carriage of the goods as well as cargoes in a recognized manner (Baughen 2012). According to a UNCTAD’s Review of Maritime Transport 2016, “the world fleet grew by 3.5 per cent in terms of Dead Weight Tons (DWT) from 1st Jan 2015 to 1st Jan 2016 leading to a situation of continued global overcapacity with the emphasis on “continued”” (Agcs.allianz.com, 2018). Therefore, it seen that although there is an increase in the amount of trade that is being conducted by these vessels, the state of these vessels is not up to the mark, as defined by the safety parameters of the maritime trade rules. The gradual increase in the amount of cargoes that are being transported by the various air-cargoes also poses a threat to these vessels. The implication of this is the fact that the number of idle container ships were only 238 in the year 2015, whereas in the year 2016, the number increased to 435 (Newstatesman.com, 2018). This accounts to almost 9% of the entire global container ships (Agcs.allianz.com, 2018).

According to a recent statistics, almost 9% of the entire global container ships were lying vacant in the year 2016 (Agcs.allianz.com, 2018). Therefore, it can be said that there has been a considerable decrease in the amount of business conducted by these container ships. This might be a result of various factors like the faster services provided by the air cargo services and various other safer models of transport. In the year 2016 alone, the industry suffered a loss of $4 billion (Agcs.allianz.com, 2018). In the recent times, the various incidents of drowning of the various cargo ships as well as the untimely delivery provided by them have also contributed to the decline in the trade conducted by the various container ships. The following figure provides an analysis of the decline of the trade conducted by these container ships in the Baltic Sea-

Charter parties and types

                                         Figure 1: Decline in the trade conducted by the container ships in the Baltic Sea

                                                                               Source: (Created by the Author)

The future looks very bleak for the container ships as the market is being overtaken by the faster as well as the safer options provided by the air as well as the road transport system. The container ships need to innovate as well as offer new and attractive plans to the customers in order to increase their business and save it from becoming extinct. The decaying as well as the traditional mechanisms used by the container ships for the transport of the cargoes also adds to the process of the decline of their market. Therefore, there is a need for new innovations as well as restructuring of the transport model used by them in order to increase their market as well as trading options.

Conclusion:

Therefore, from the above discussion it becomes clear that the various container ships were once an important means of cargo as well as other bulk transporting vessels in the various sea routes. Most of these ships are owned by the governmental organizations. A recent trend seen however is that most of the container ships are owned by the various private individuals as well as private organizations. However, the recent technologically advanced as well as safer modes of transport offered by the various air and the land transporting services have overtaken their trading market. Therefore, it can be said that there is a need for an improvement in the practices as well as principles followed by these transporting ships.

References:

Agcs.allianz.com. (2018). Shipping Review 2017. [online] Available at: https://www.agcs.allianz.com/assets/PDFs/Reports/AGCS_Safety_Shipping_Review_2017.pdf [Accessed 20 Jan. 2018].

Baughen, S., 2012. Shipping law. Routledge.

Cma-cgm.com. (2018). CMA CGM Group: a leading worldwide shipping group. [online] Available at: https://www.cma-cgm.com/ [Accessed 20 Jan. 2018].

Cooke, J., Young, T., Ashcroft, M., Taylor, A., Kimball, J., Martowski, D., Lambert, L. and Sturley, M., 2014. Voyage charters. CRC Press.

Hapag-lloyd.com. (2018). Hapag Lloyd. [online] Available at: https://www.hapag-lloyd.com/en/home.html [Accessed 20 Jan. 2018].

Newstatesman.com. (2018). The global shipping slowdown hints at a recession around the corner. [online] Available at: https://www.newstatesman.com/politics/economy/2016/02/global-shipping-slowdown-hints-recession-around-corner [Accessed 20 Jan. 2018].

Rogers, A., Chuah, J. and Dockray, M., 2016. Cases and Materials on the Carriage of Goods by Sea. Routledge.

www.maerskline.com. (2018). Maerskline Group. [online] Available at: https://www.maerskline.com/ [Accessed 20 Jan. 2018].