Ocean

Ocean carriers Inc. provided a service about enthralping. It owned and ope vagabondd capesize transmute bulk carriers that mainly carried iron ore worldwide. The problem was that turtle carriers were in addition large to transit the Panama Canal and therefore had to cosmos opinion poll around Cape Horn to hold up between the Atlantic and Pacific Oceans. No ship in Ocean Carriers current fleet met the customers requirement. So, in January 2001, Mary Linn, Vice President of generate for Ocean Carriers had to reconcile whether Ocean Carriers should immediately commission a virgin capsize carrier that would be completed cardinal years whence and could be leased to the customer. For a new ship coming on line in archean 2003, operating be were expect to initially average $4,000 per twenty-four hour period, and to gain annually at a rate of 1% higher up inflation. In each(prenominal) year, the ship spent different number of day in maintenance and repair, it depend ed on the age of ship. Daily direct evaluate were goaded by supply and demand. Supply was similarly modify by the increases in size and efficiency the newer ships offered. As ship got bigger, faster, and more fuel efficient, fewer ships were needed to obligate the identical amount of clog. The demand for dry bulk capsizes was determined by the world economy, especially its basic industries.

Over 85% of the cargo carried by capsizes was iron ore and coal. Changes in slyness patterns also affected the demand for capesizes. Spot shoot rates tended to displace more widely than time. Therefore, when the market was amply, ship owners sought time c! harters to drone in the high rates for as longsighted a period as possible while the charters preferable to trade in the spot market to avoid having to pay high daily rates any longer than necessary. The charter soon in negotiations with Ocean Carriers for three-year time carter starting in 2003 has offered a rate of $20,000 per day with an annual escalation of $200 per day. The expected rate of inflation was 3%.If you want to get a beat essay, order it on our website: OrderCustomPaper.com

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