Ocean Carriers (Essay Sample)

Ocean Carriers
Student’s Name
Institutional Affiliation
Ocean Carriers
Question One
According to the given case, a capesize is the largest dry cargo ship. The ships have a cargo carrying capacity that ranges from 80,000 deadweight tons to 210,000 deadweight tons. Moreover, capesize carriers are usually too large to pass through the Panama Canal and hence sail through the Cape Horn to access the Pacific and Atlantic oceans. Capesize ships are in most cases used to transport iron ore, coal and other bulk raw materials. Their deep draughts and large dimensions make them suitable for large ports with deep terminals.
Question Two
The daily spot hire rates will increase due to the increased fleet size that is expected to increase to 612. Furthermore, the expected increase in the production of Australian iron ore and exports of Indian ore will increase demand for capsizes and also increase the volume of trade that consequently increase the daily spot rates.
Question Three
The daily average rates of hire are determined by demand and supply. Supply depends on the number of ships in service in the previous year, added to any new ships delivered minus any ships sunk or scrapp...