DRY BULK MARKET IN SHIPPING
Every day, thousands of vessels cross the world's oceans carrying dry bulk commodities to market. These are the shipments that fuel industry, build infrastructure and feed millions. The very stuff of modern life.
The global dry bulk trade is big business. Despite the shake-up of many markets, demand is strong - very strong. Indeed, 2009 was the best year for dry bulk since 1970.
With most markets far from the raw materials they need, cargoes are shipping in bulk carriers, of between 45,000 and 150,000 DWT capacity, some of which are designed for specific trades or routes. There are about 7,000 of these workhorses sailing the world's oceans, transporting iron ore, coal, bauxite, alumina, grains, steel, sugar, fertilizers, minerals, cement and more.
About 2.5 billion tonnes of dry bulk cargo travel by sea every year.
Coal and iron ore together represent more than 57% of the global bulk trade. Fast-track industrialization in many developing countries continues to drive strong demand for these commodities.
Iron ore and steel (along with lesser bulk commodities like cement and copper) are the building blocks of infrastructure. Coal generates much of the energy needed to drive that growth.
Demand is unlikely to fall in the foreseeable future. China's growth remains up near 10% and India's coal are imports are expected to rise from an estimated 70 million tonnes in 2010 to 200 million tonnes by 2020
Spiralling oil prices have led to the resurgence of previously out-of-favour forms of coal as a source of power. New carbon-capture technology and instability in oil-producing areas are making non-viable coal worth extracting again, even to the extent of re-opening mines in Poland.
Environmental concerns have increased demand for alternative 'green' fuels such as wood pellets and chips and other 'biomass' for thermal power or cement plants, and tremendous quantities of corn and sugar for ethanol production.
Immigration, urbanization and changing dietary habits are also boosting world demand for an array of fertilizers to increase production of wheat, rice, soya, barley, sunflower seeds, corn, sugar and other crops.
Amid all the tonnages lies a dizzying array of external factors that can affect the dry bulk business: natural disasters, droughts, political and social upheavals, even changing fashions.
Commodities - and the ships that carry them - are not always available. Conversely, the sudden arrival of vessels in a port or any disruption to the supply lines such as railway delays or derailments can cause severe congestion.
Such upheavals can have a significant impact on supply and demand and the ship agent must deal constantly with having his best-laid plans thrown up in the air.
It takes much more than just the ability to look after dry bulk ships in port to truly serve the sector.
Ship Agents must have thorough knowledge of the goods carried as well as the global presence to ensure that vessels are properly attended, wherever they go. After that, it is all the additional upstream and downstream services on top of ship agency that mark the difference between agents.
Such Service include: customs clearance; stevedoring; bunker supplies, stores and spares logistics; equipment supply; land transportation; storage facilities; inventory management; blending; distribution; surveying; port intelligence; protective services; weather routing; and more.
The day-to-day complexities of this business make it much more than 'just' another area of shipping.
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