26 chartering terms
Shipping & chartering glossary
Plain-English definitions of the terms behind every fixture, as our brokers use them when they read, check and compare cargo and tonnage.
- AAddress commission
- A percentage of freight or hire that the owner allows back to the charterer under the charter party, separate from the brokerage paid to brokers.
- Read the full guide
- Related: Charter party, Freight rate
- BBallast voyage
- A ballast voyage is the leg a vessel sails without cargo — typically from where it discharges to the next load port. Ballast distance and cost are central to whether a cargo is worth taking.
- Related: Open vessel position, Voyage estimate, Freight rate
- BBareboat charter
- Also called a demise charter: the charterer takes possession of the ship for a long period and crews, insures and operates it. Used mainly for financing and long-term control.
- Read the full guide
- Related: Time charter, Voyage charter
- CCargo enquiry
- A cargo enquiry describes a parcel a charterer needs to move — commodity, quantity and tolerance, load and discharge ports and the laycan — circulated to find suitable tonnage.
- Related: Laycan, Open vessel position, Stowage factor
- CCharter party
- The contract between a shipowner and a charterer, usually a standard form such as GENCON or NYPE amended with the agreed terms and rider clauses.
- Read the full guide
- Related: Recap, Fixture, Contract of affreightment
- CContract of affreightment
- A COA commits the owner to carry a total quantity of cargo in several shipments over a period, at agreed terms, with the owner nominating a suitable ship for each shipment.
- Read the full guide
- Related: Voyage charter, Charter party
- DDeadweight (DWT)
- The total weight a ship can carry at its summer draft: cargo, bunkers, fresh water and stores. Bulk carrier size classes are defined by deadweight.
- Read the full guide
- Related: Stowage factor, Geared vessel
- DDemurrage
- Demurrage is the sum payable to the owner when the vessel is detained beyond the agreed laytime for loading or discharging. It compensates the owner for time lost.
- Read the full guide
- Related: Despatch, NOR, SOF
- DDespatch
- Despatch is money paid by the owner to the charterer for finishing loading or discharging in less than the allowed laytime — the mirror of demurrage, usually at half the demurrage rate.
- Read the full guide
- Related: Demurrage, NOR, SOF
- FFirm offer
- A firm offer is a binding proposal of charter terms, open for acceptance for a stated time. Once accepted within that time (subject to any stated subjects), it forms the basis of a fixture.
- Related: Subject, Fixture, Recap
- FFixture
- A fixture is a concluded charter: terms agreed and all subjects lifted. It is recorded in the recap and governs the voyage that follows.
- Related: Firm offer, Subject, Recap
- FFreight rate
- The freight rate is the price for carrying cargo, usually quoted per tonne or as a lump sum. It is only one input into total voyage economics — ballast, port, bunker and delay costs matter too.
- Read the full guide
- Related: Voyage estimate, Ballast voyage, Demurrage
- GGeared vessel
- A ship with its own cranes or derricks, able to load and discharge without shore equipment. Most Handysize to Ultramax bulk carriers are geared; Panamax and larger usually are not.
- Read the full guide
- Related: Deadweight (DWT), Stowage factor
- LLaycan
- The laycan (laydays / cancelling) is the agreed window during which a vessel must arrive at the load port and be ready to load. Arrive before laydays and the charterer need not accept the vessel yet; arrive after the cancelling date and the charterer may cancel the charter.
- Read the full guide
- Related: Cargo enquiry, Fixture, Voyage estimate
- LLaytime
- The time allowed to the charterer for loading or discharging, fixed in days or derived from a rate such as 5,000 mt per day. Time beyond it is paid as demurrage.
- Read the full guide
- Related: Demurrage, NOR, SHINC / SHEX
- NNOR
- The Notice of Readiness (NOR) is the master's notice that the vessel has arrived and is ready to load or discharge. A valid NOR starts the laytime clock, subject to the charter party terms.
- Read the full guide
- Related: SOF, Demurrage, Laycan
- OOpen vessel position
- An open position is a statement of where and when a vessel becomes free (its open port and open date) together with its particulars, circulated so charterers can match cargo to it.
- Related: Ballast voyage, Cargo enquiry, Fixture
- RRecap
- A recap is the written summary of the agreed charter terms, capturing what was fixed so both sides work from the same record.
- Read the full guide
- Related: Fixture, Firm offer, Subject
- SSHINC / SHEX
- Laytime terms. SHINC: Sundays and holidays included, so every day counts. SHEX: Sundays and holidays excepted, so they do not count unless the charter says otherwise.
- Read the full guide
- Related: Laytime, Demurrage
- SSOF
- The Statement of Facts (SOF) is the port record of events and times during loading or discharging. It is the primary evidence for calculating laytime, demurrage and despatch.
- Related: NOR, Demurrage, Despatch
- SStowage factor
- The stowage factor is the volume a unit of cargo occupies (for example cubic metres per tonne). With a vessel's grain or bale capacity it determines how much cargo actually fits.
- Read the full guide
- Related: Cargo enquiry, Voyage estimate
- SSubject
- A subject is a condition that must be lifted before a fixture is clean — for example subject to management approval, stem or survey. Open subjects mean the deal is agreed in principle but not yet firm.
- Related: Firm offer, Fixture, Recap
- TTime charter
- A charter for the use of a ship for a period or a trip, paid as daily hire. The charterer directs the ship and pays bunkers and port costs; the owner keeps crew, maintenance and hull insurance.
- Read the full guide
- Related: Voyage charter, Time charter equivalent, Bareboat charter
- TTime charter equivalent
- TCE turns a voyage result into a daily figure: freight minus voyage costs (bunkers, port costs, commissions), divided by voyage days. It lets voyage and time charter business be compared.
- Read the full guide
- Related: Freight rate, Voyage estimate, Time charter
- VVoyage charter
- A charter for carrying a cargo between named ports for freight, paid per tonne or as a lump sum. The owner runs the ship and pays the voyage costs; the charterer's exposure is port time through laytime and demurrage.
- Read the full guide
- Related: Time charter, Freight rate, Demurrage
- VVoyage estimate
- A voyage estimate projects the economics of a candidate voyage — distance, bunkers, port and canal costs, carbon and time — to compare options on total economics rather than the freight rate alone.
- Read the full guide
- Related: Freight rate, Ballast voyage, Stowage factor
Have a cargo or an open vessel? Our brokers work these terms every day. Send a cargo or an open vessel.