Shipping Industry Analysis - Essay Example

Introduction to Shipping Introduction to Shipping Shipping industry is responsible for the transportation of passengers and goods by water. Previously passenger operations were the major component of shipping though lately it is limited because of the popularity of air transport. Lately the transportation of goods has been more popular especially for the transportation of bulky commodities. Commercial shipping is believed to have begun with the activities of the Phoenician merchants who used their own vessel to transport commodities in the Mediterranean. Through the advancement of technology, the shipping industry has gradually grown in the current state. This paper aims at explaining the design process and factors to be considered with the building of a commercial ship and describing the scope and scale of the international shipping industry. A ship design process refers to a process in which the ship owner description and requirements are set into specifications, drawing, and technical information needed for the actual building of the ship. This process is always led by a naval architect but highly contributed to by designers, engineers and many other relevant professionals. The ship designing process is subdivided into various phases. During each phase, the design is improved by increasing the level of details. The owners specification about the ship to be designed must contain detailed about fuel endurance, cargo capacity in terms of volume and weight, and speed (Okumoto 2009, p. 64). The building and operation cost are determined by the owner. The ship design process mainly consists of four stages. These stages are: identification of needs; definition of requirements; selection of the design criteria and development of solution framework. The process can also be phased into three phases namely: initial design, basic design, and the detailed design. This nature of the process can be referred to as a design spiral methodology and strategy. Given that the design requirements is not always similar for all ship owners, it is always important to make use of the relevant tools and experience in incorporating different and conflicting expectations and requirements in design missions (Barrass 2004, p. 101). The diagram above illustrates the naval architecture progress. At the initial design stage, the design team has the task of determining the parameters that are supposed to be the basis for the optimal ship dimensions. The team should also hull form development and also propulsion auxiliary systems and system selection in accordance to the requirements of the owner. This stage of design is mainly characterized by analysis of the owner’s requirements, problem definition, conceptual design, preliminary specification, sketch drawing, and 3D rendering. In addition, this stage might also include activities like determination of the dimensions, preliminary calculation of damage stability, stability, and loading conditions (Watson 1998, p. 213). They should also make preliminary calculations on powering as part of the preliminary hull from design. The designers should also make sure that they perform preliminary evacuation analysis and ergonomic design, payload definition, and preliminary passenger calculation. The designers move to the basic design stage only after agreement with the owner of the contents of the initial design stage. At this stage, the designers review the requirement list, approve them, and then purchase them. They then do the interior design work, and make planning on the production. After that they do the final calculation of the damage stability, loading condition, heat balance, stability, and electric load balance (Biran 2003, p. 137). This is mainly because after consultation with the owner some specifications might be altered. After all these activities have been carried out, the designers then finalize on the ship design specifications. It is only after this that the shipbuilding contract can be finalized on. The actual designing of the ship begins at the detailed design stage. This stage is characterized by designing of the interiors of the ship, deck outfitting, designing of the electrical components of the ship. The design then designs the mid-ship section. This is characterized by the design of longitudinal and transverse details of the ship. They also prepare the steel construction drawing, decks, shell expansion, and profile design. It is also at this stage that designs are made on the foundation of the main engine, arrangement of the engine room, and any other machinery equipments (Gaythwaite 2004, p. 237). Details on the aft and fore structural aspects are also designed at this stage. After this, the designers proceed to design the crane columns and signal masts. The detailed design stage is also characterized by the designing of loading and unloading ramps, special structure configurations, and hatch covers. They also design on the machinery arrangement, outfitting, and piping. After all this calculation relating to the selection and capacity of the equipment are made. With this information, they proceed to calculate air capacity, heat balance, then determining the length of the heating coil (Biles 2009, p. 192). They then design the piping diagram followed by those of alternating current connections, exhaust system, and the ventilation ducts. The figure above shows a complete drawing of a ship design. Retrieved from https://encrypted-tbn3.gstatic.com/images?q=tbn:ANd9GcSEqE09xTbN_akf7AGaW7B9zhEqP8F_0B9p3Z5DFc-UILNY7HVj A ship should have transversal, local, and longitudinal strength. The longitudinal strength is supposed to bear shearing load and bending load while the transversal load should bear the twisted load and the racking loading added to the shearing and bending load. These considerations should be made when designing details on transversal and longitudinal strength. Ship designing has over the years had its successes and its failures. However, the successes exceed the failure and that is confirmed by the high rate at which the ship designing process is improving. Currently the designers no longer use the traditional techniques that were popular before. Success in designing of commercial ships can be confirmed by the rate at which new ship designs are introduced into the market. One of such successes was the introduction of type C1 ship, which was a small cargo ship, built in the United States of America. These sheep were popular for their high speed, which was mostly attributed to the designers. Another example of such a ship is triple-E, which is referred to as the world’s biggest ship. Despite its slower speed, it has a big capacity and reduces carbon emission by about 50%. Some of the failures in design include ship designs such as the vasa, which sank in the year 1628. The sinking of this ship was attributed to faulty design, which must have been a result of the lack of well laid down procedure for the designing of ships. Shipping is a competitive transport services industry that is mostly private. The activities involved in this industry are further divided into several various categories. The categories in question include tramp shipping, liner service, tanker operation, and industrial service. All these categories operate on specific well-established sea routes. A good number of the world’s shipping companies use relatively few major ocean routes (Cullinane 2011, p. 201). The ocean routes being referred to are: the Mediterranean-Asian route through the Suez Canal; the North Atlantic between Eastern North America and Europe; the Panama Canal which connects eastern American coasts and Europe with Asia and western American coasts; the south American route linking south America to north America and Europe; the south African route which links Africa to America and Europe; the south pacific route which connects western America to Australia, Indonesia, new Zealand, and south Asia; and finally the north pacific route which links China and Japan with western America. The diagram above shows the major global ocean routes. Retrieved from: https://encrypted-tbn0.gstatic.com/images?q=tbn:ANd9GcTntEoPjVfa0f7lXRH6s Liner services have regular shipping with schedules and operate on fixed routes. Liner services accept cargos under a bill of landing contract that is issued to the shipper by the ship operator. Agreements known as conferences are responsible for the regulation competition in liner service (Frankel 2011, p. 287). The conferences are aimed at stabilizing conditions of competition through setting freights rates and passenger fares for all the members of the conferences. Tramps are also known as general service ships and have neither regular services nor regular routes. Under normal circumstances, tramps transport shipload lots of a similar commodity for a singular shipper. Such like cargoes mostly contain low value material and raw materials such as ore, coal, or grains. Such goods always have requirement for cheap means of transport. Tramps are not classified in terms of design but on basis of employment. Normal tramps operate under a charter party, which is a contract of the terms and conditions for the use of the vessel. There are three types of charter parties. These are the time charter, the voyage charter, and the bareboat charter. Tankers are mostly used by oil companies. All of them are either contract or private carriers. Supertankers are used in transportation of crude oil while smaller tankers are used to transport refined products such as kerosene, gasoline, and lubricating oils. Merchant ships are categorized into cargo ships, carriers, and tankers. Cargo ships transport utilized cargo, packaged goods, and limited quantities of ore, grain, and liquids such as edible oils and latex. A few passengers can be allowed into some cargo liners (Pamborides 1999, p. 173). Container ships carry large truck goods and can discharge and load in a single day, as compared to the ten days needed by convectional ships of the same size. They are designed in a way in which they can deliver cargoes on developed and underdeveloped ports. Tankers are designed to transport liquid cargoes. They transports mainly molasses, wine, petroleum, and refrigerated products. The shipping industry is an integral part of global economy. It is estimated that over 90% of global trade take place through sea. An increase in industrialization acts as a catalyzing factor in increasing the total trade volume. Advance in technology has also been one of the main contributors to the advancement of the shipping industry. Shipping has the least effect to environment as compared to the other forms of the other forms of transport (Kendall & Buckley 2001, p. 145). It is also the least contributor to marine pollution as compared to other human activities that cause marine pollution. A company that operates ships between advertised ports regularly is referred to as a shipping line. Carrier is a ship-owner or any individual signs a contract with the shipper on transportation of commodities. Brokers in the shipping play various roles. Brokers in the shipping industry are categorized into insurance brokers and shipbrokers. Insurance brokers act as intermediary between underwriters and cargo/ship owners during the negotiation of marine insurance. They can be an individual or part of a large broking organization. Shipbrokers can further be divided into sales and purchase brokers; ship owner’s brokers; liner brokers; charterer’s brokers; and chartering brokers (Unger 2011, p. 187). There are various agencies, which regulate the global shipping industry. The International Maritime Organization (IMO) is the most involved of these agencies. IMO is charged with the responsibility of developing and maintaining the framework of global regulation for maritime safety. The main concerns of this agency are general safety, conservation of the environment, technical cooperation amongst the involved parties, legal matters, efficiency of shipping, and marine security (Fayle 2006, p. 213). The agency carries out its duties in a series of meetings always attended by member states. It is through these meetings that the agency comes up with resolutions that are aimed at making the shipping industry better. Despite the fact that the shipping industry is currently doing very well, it is predicted that it will face a decline of up to 10% in the coming years. This is attributed to the high bunker oil prices and its oversupply. This is likely to affect its performance. An oversupply in sea vessels combined with the high bunker oil prices is likely to cause pressure in the margins in most sectors of shipping. Crude oil tankers and dry bulk segment are likely to experience the largest gap between supply and demand in the year 2013. This will negatively affect the ability of the industry to make meaningful improvements in their incomes. Bibliography Barrass, C. B. (2004). Ship design and performance for masters and mates. Oxford: Elsevier Butterworth-Heinemann. http://www.engineeringvillage.com/controller/servlet/OpenURL?genre=book&isbn=9780750660006. Biles, J. H. (2009). The design and construction of ships Vol. 2. Vol. 2. Bremen: Salzwasser-Verl. Biran, A. B. (2003). Ship hydrostatics and stability. Oxford: Butterworth-Heinemann. http://www.myilibrary.com?id=96622. Cullinane, K. (2011). International Handbook of Maritime Economics. Cheltenham: Edward Elgar Pub. http://public.eblib.com/EBLPublic/PublicView.do?ptiID=685068. Fayle, C. E. (2006). A short history of the worlds shipping industry. London: Routledge. Frankel, E. G. (2011). The world shipping industry. London: Routledge. Gaythwaite, J. W. (2004). Design of marine facilities for the berthing, mooring, and repair of vessels. Reston (Va.): ASCE Press. 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