An Overview about Ship broking

Ranadeb Ray

An Overview about Ship broking

Ranadeb Ray

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This is an overview about Shipbroking in general for all who have an interest or who would like to know more about it.

An Overview about Ship broking Shipbroking is a fascinating segment or a vertical coming under the Shipping Industry. There are many individuals who do not have any idea about it at all. And of course, there are Shipbroking managers who are quite busy and an expert in their respective field. There is no specific definition of Shipbroking and in each company, the approach used is different. Shipbroking has 2 aspects or sides to it – Tonnage side and the Cargo side. From the Tonnage side are the Ship Owners who have at their disposal their ships which will carry the cargo from one port to another. From the Cargo side come the Cargo Owners who have a wide range of cargoes with them. A shipbroker is that person who will work in between the two - Tonnage and Cargo sides. A Shipbroker`s task is to bring together the Ship Owner and the Cargo Owner; also know as Charterer. And for making a match or a deal for the company, the broker earns a commission which is around 1.25% of the total amount. For example – Ship is carrying a total of 50,000 MT of cargo and per MT is say, 50 USD. Therefore, the total amount here will be USD 2,500,000 for which the broker will get a commission of around USD 31250. Here, work on both the sides are quite exhaustive and are important. For a Tonnage Broker, the responsibility in short, would be to find out new Tonnages which are available in the market through a variety of sources such as the company Software and his/her individual connections. From this side, we have a large variety of Ship Owners catering to the different segments of Shipping such as Offshore Shipbroker Dry Bulk Carriers Shipbroker Tanker Shipbroker Yacht Shipbroker Here, GRT and NRT come into play quite a lot as it decides the freight or revenue earned for the company. Also important are DWT and LDT in this respect. For a Cargo Broker, the responsibility in short, would be to find out new available cargoes and work out the proper balance which will gives the Shipbroker firm a handsome profit. Here, there is a wide array of cargoes available in the market such as Dry Cargo. Wet or Liquid Cargo. Hazardous Cargo. Reefer Cargo. Another type of a Broker would be the ‘Sale & Purchase’ Broker who would be looking into the aspects of buying and selling of a ship. Also, another part here would be the Scrapping or Demolition of a ship on “as is where is” basis. Here, in respect of scrapping, another organization also has a role to offer, namely “Vessels Value” which lists out the expected value of these old assets. They have a monthly subscription and also many other plans wherein an individual can get the concerned & precise data from them. Their HO is also in London. There are many such deals done by these Shipbroking firms and they understand the market and find out new clients. There are lots of Institutions wherein one can learn and study about Shipbroking. But, the best and the most widely respected Institute is ICS or Institute of Chartered Shipbrokers having its HO in London. There is also another organization in London which is FONASBA or The Federation of National Associations of Shipbrokers and Agents. They also work closely with other ship owning bodies such as BIMCO, Intercargo and Intertanko. For a new aspirant to get into this Industry would be very much difficult as mostly all Shipbroking firms want only an experienced person to handle their existing clients & to bring in new clients. Having someone work at the desk with years of experience behind them is always advantageous for the company, but they should also be looking to recruit new qualified candidates who have an interest in this field and willing to work here. This is where, in my opinion that the company should bring out new roles such as a Trainee role wherein the candidate is given a proper training for a few weeks and where the candidate works daily with a senior shipbroker. Another aspect to look at would be the qualifications of an individual who is eager to join this Industry. Sometimes, qualifications are more important and they need to be counted before evaluating his /her work experience. Overall, this is a new array of shipping which is emerging as a significant role in India. This would be the future of Shipping in years to come along with other segments.

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