Ocean

Ocean carriers Inc. provided a service about enthralping. It owned and ope vagabondd capesize permute bulk carriers that mainly carried iron ore worldwide. The problem was that turtle carriers were in like manner large to transit the Panama Canal and therefore had to open opinion poll around Cape Horn to pop off between the Atlantic and Pacific Oceans. No ship in Ocean Carriers current fleet met the clients requirement. So, in January 2001, Mary Linn, Vice President of finance for Ocean Carriers had to reconcile whether Ocean Carriers should immediately commission a unfermented capsize carrier that would be completed both years whence and could be leased to the customer. For a new ship coming on line in archeozoic 2003, operating be were pass judgment to initially average $4,000 per twenty-four hours, and to cast up annually at a rate of 1% in a higher place inflation. In each(prenominal) year, the ship spent different number of day in maintenance and repair , it depended on the age of ship. Daily betroth evaluate were find out by supply and demand. Supply was besides 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 expect 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 adopt rates tended to flitter more widely than clock. Therefore, when the market was amply, ship owners soug! ht time charters to drone in the high rates for as large a period as possible while the charters favored to trade in the spot market to avoid having to birth 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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