Chartering strategies for shipping companies

This paper describes a model which may be used in the evaluation of the relative effectiveness of policies used in the areas of ship chartering and the switching of combined carriers between the dry cargo market and the tanker market. The policies for chartering and market switching are expressed in the form of ‘desired proportions’ of the fleet operating in a particular charter-mode or a particular market. Graphical illustration of this form of expression of policies can be easily understood, so that alternative policies can be designed with relative ease. The effectiveness of a particular form of policy under various freight market conditions can be determined from the model, the use of which is illustrated by its application to the deployment of the fleet of an hypothetical shipping company. It is assumed that the feedback connection between the company's actions and the marketplace is negligible.