Friday, February 22, 2019

Tramp and Bulk Shipping, Forecasting, and a Chilled Viognier on a Thames Terrace

My gigantism in container shipping  ‘little book’[1] gave me the opportunity to do something I have always wanted to do since the days of my good friend and colleague, the late Basil Metaxas and his infamous monograph The Economics of Tramp Shipping (Athlone Press, 1971). This was my perceived need for a clarification in the concepts of tramp; tramping; or tramp shipping on the one hand, and bulk shipping or even bulk-carrier on the other.

Often in the literature, the two concepts, tramp and bulk, have been confused or used interchangeably. Even worse, a “tramp ship” has often been used synonymously to a “bulk ship”, or bulk-carrier, and vice versa. However, “tramping” simply means operating a ship in the spot (voyage) market -i.e. as a taxi of the seas, whereby the contractual relationship between ‘passenger’ and ‘taxi-driver’ (‘cargo owner’ and ‘shipowner’ in our case) ends upon the completion of the voyage and the driver (shipowner) is again on the lookout for new custom (cargo) that will take him to the four corners of the earth, without any scheduling or fixed itinerary (thus the name tramp). Other than the ship itself, the provision of a tramp service requires minimal carrier infrastructure;[2] the market is highly competitive, with prices (freight rates) fluctuating wildly even in the course of one day.

Certainly, however, tramping does not assume any particular type of ship, such as a tanker or a bulk-carrier. To put it differently, a bulk-carrier or a tanker on a long-term time-charter is not tramping, nor is one engaged in a contract of affreightment. In short, the mere fact that a bulk ship is not offering regular or scheduled services, like a liner ship, does not make her a tramp. In the opposite, and this is the first time you hear this, a small container feeder-ship which out of, say, the hub of Piraeus distributes containers all over the Mediterranean, working as a common carrier, indiscriminately serving many principals (main-haul majors such as Maersk, MSc, CMA CGM, Cosco, etc.) would most definitely fall under my definition of tramping.

HE Haralambides

[1] Freely downloadable from: Gigantism in Container Shipping.
[2] Things nowadays may be somewhat different, but I remember a Greek shipowner friend, years back, telling me that, to do tramping, the only things you needed were a telephone, a shared office and a part-time secretary! He was also very good in forecasting… I remember him once, while sipping a glorious chilled Viognier on his terrace, overlooking the Thames, attentively and silently looking down on the street. “what are you doing”, I asked. “When the queue of the taxis below is long”, he replied, “business is not good, and people take the bus… shipping will not be doing well either”, he said philosophically with half a smile, refilling at the same time our glasses.

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