Chartering & Ship Sizes

Chartering, Charterers & Ship Sizes

Imperium Commodity Search works with trading houses and shipowners globally across a wealth of commodity products and classes.  Chartering is critical to the smooth operational supply chain of global commodity trade. 

During 2020, chartering departments across the world worked overtime, desperately trying to secure cargo space for the delivery of critical commodities in a disrupted global supply chain.  Chartering departments are critical within trading houses to ensure the smooth transportation of energy, metal and agricultural products globally. 

What are Charterers?

Charterers are critical functions within commodity production, sales and trading businesses, ensuring product is moved where it needs to go upon sale.  Managing the physical logistics and supply chain of the commodity world, charterers work either in-house with large ship owning commodity houses ensuring efficient utilisation of shipping & cargo capacity or work in trading houses that rely upon shipbrokers to source suitable shipping capacity and space to charter vessels to suit their needs.  Many ship-owning commodity houses also utilise third party shipping companies and brokers to facilitate additional trading requirements when their own vessels are at sea/on voyage.  

Charterers perform a number of duties for their respective employers: 

Voyage Planning involves calculating the costs associated with shipping a particular product from port A to port B, and covers all aspects of port operations, costings and logistics.  Voyage planning is critical to ensure shipping availability and cost efficiencies in the supply chain.  

Insurance and Demurrage covers the insurance side of shipping products and plans for insurance claims in the event a voyage is late unloading, product is lost or product is damaged in transit/at discharge. 

Vendor/Third Party management is critical in chartering, as there are numerous stakeholders involved in the shipping process.  This includes the port at either end, insurance/demurrage firms, shipbrokers and operational staff. 

Crewing is often the duty of the chartering department in ship-owning firms where efficient allocation of personnel is critical in ensuring a cost effective and efficient supply chain. 

Documentation is required at every step of the shipping process, covering letters of credit, bills of lading, insurance/demurrage and discharge/port slips.  Charterers work with internal operations and traffic teams to ensure documentation is timely, accurate and compliant for each voyage. 

Chartering markets and entry: 

Charterers operate in every area of commodities and are often specialised in their product or ship class to ensure a deep understanding of the requirements of the product being handled.  Grain houses, oil majors, metal traders, miners and production businesses will all possess, or make use of chartering teams and departments to cover their specific market. 

Charterers often come from a maritime heavy background and usually have maritime related degrees from specialist universities.  Demand for charterers in the market is closely aligned with global commodity performance and trading sentiment.  As demand increases and the commodity market enters a bullish period, the demand for charterers increases to accommodate. 

Ship Sizes

Shipping businesses, chartering departments and traffic teams manage a variety of ship sizes and classes to fulfil specific roles and products within commodity trading.  Understanding the shipping classes and usages of each size are important in chartering and the management of global commodity logistics. 
In the definitions below, we refer to DWT (deadweight tonnage) as the measure of a ships size.  This refers to the total carrying capacity of the ship (not included the weight of the vessel itself).  For full definitions of commonly used shipping terms, visit our glossary of terms.
Handymax & Supramax
Handymax or Handy Sized ships are the most commonly used dry cargo vessel today.  As well as dry cargo, Handymax are also often seen in certain ports or locations for wet product where larger crude carriers are prohibitively sized.  They are regularly used as their smaller size allows them to dock in any port.  Handymax and Supramax vessels are generally sized at 40-60,000DWT, they are always capped at 60,000 to allow flexibility in port stops.   Handysize are smaller than Handymax and Supramax vessels, generally offering 20-30,000DWT.
The aptly named Panamax vessel is the largest sized ship that can fit through the Panama canal under the Panama Canal Authority’s size limitations.  Slightly larger than Handymax vessels, Panamax can handle up to 65-70,000DWT.  Most commonly used for energy products, there are also a number of Panamax container and dry cargo vessels in operation today. 
Aframax vessels sit between Panamax and Suezmax in terms of DWT, coming in at 80-120,000DWT.  Most commonly used to transport wet products including crude oil and distillates.  Used in situations where VLCC and ULCC crude carriers are too large for the volume of oil being shipped.
Like the Panamax, the Suezmax is so named as it is the largest ship that can be accommodated within limits through the Suez Canal.  Significantly larger than the Handy and Panamax vessels, Suezmax have a carry weight of 120-200,000DWT.  Used to transport all commodity classes, there are specialised Suezmax vessels for the transportation of both dry and wet product across grains, metals, softs and energy. 
VLCC/ULCC (Crude Carriers)
VLCC and ULCC vessels refer to the largest crude and oil tankers on earth.  VLCC, referring to Very Large Crude Carriers describes ships with a capacity up to 320,000DWT whilst ULCC, referring to Ultra Large Crude Carriers describes ships with a capacity in excess of 320,000DWT.  These vessels are commonly used by oil majors on the busiest oil supply and refining routes, including Europe>Middle East>Europe and US>Asia>US. 
Q-Max (Qatar-Max) vessels are LNG specialist carriers designed to transport the largest quantities of LNG possible whilst being able to dock at the Qatari LNG terminals.  These vessels have a capacity of 266,000 cubic meters of LNG, making them one of the largest LNG carriers on earth today.  
In addition to the above ship sizes and classes, there are numerous named vessels which facilitate the largest possible carry-weight for the ports of their operation.  Some of these include Capesize (large, deepwater terminals), Malaccamax (largest through Strait of Malacca), Seawaymax (largest through the St Lawrence Seaway), Newcastlemax (largest into Port of Newcastle, Australia), Dunkirkmax (largest into Dunkirk lock).

Imperium Commodity Search – Specialist headhunters and executive search to the shipping and chartering space

Imperium Commodity Search work with a variety of shipping market participants, including shipbrokers, ship-owners, trading houses and shipping businesses.  Our consultants have placed charterers in each key commodity asset class (Energy, Metals, Agri) and work with charterers in all major ports/trading destinations. 

To view our current shipping, operations and chartering vacancies click here or contact one of our consultants to discuss current careers / jobs in shipping and chartering to discuss your needs in more detail. 

To arrange a consultation with a recruitment consultant to discuss your hiring needs / growth plans and where we can assist click here or contact one of our consultants directly here for a confidential discussion.

For specialist advice on growth and hiring plans in the chartering & shipping world, please contact Josh Clark Mark Taylor; our resident shipping specialists

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