There are differences between the market structures of tanker chartering and

dry bulk chartering. One characteristic of the tanker market has been the
dominating position held a comparatively small number of big charterers: the
large oil companies. Many ship owners prefer to place their ships on time charter
for a long period and there is also spot market. In the tanker market, the daily
fluctuations, as well as the periodical changes, normally occur very rapidly and
with strong deflections which may cause the situation to change radically from
one hour to the next. The fast movement is mainly due to the quick changes of
the oil prices. Tanker market is imperfect competition. For dry bulk market, it can
be divided by a few sectors which are bulker, tweendecker, container, liner, ro-ro
and small ships. It is perfectly competitive market.

There are differences between the freight rates in voyage charter of tanker
chartering and dry bulk chartering. The freight rates are quoted with reference to
an international scale called the new worldwide tanker normal freight scale. For
example, worldscale 90 is equal to 90% of the standard freight rate for that
voyage. By using such standard scale as a reference the parties in the tanker
market can easily compare and evaluate freight rates for all the different voyages
and market levels. Port costs and other costs such as canal dues are included in
the scale. It also includes laytime and demurrage rates for all sizes of tanker. For
dry bulk chartering, the freight of the dry cargo voyage charter is usually
expressed in terms of dollar per tonne of cargo carried. Dry bulk chartering
market do not have Worldscale system. The reason that scales are not used for
cargo vessels is that the variety of cargoes and loading ports is so great that any
scale tables would be too large, complicated and expensive to be worthwhile.

There are differences between tanker chartering and dry bulk chartering in
terms of laytime. For tanker voyage chartering, the laytime allowed under the
Worldscale system of freight is 72 hours for loading and discharging. It is
normally calculated on the terms SHINC, which means laytime includes Sundays
and holidays. Laytime commences after NOR has been tendered, whether the
vessel is in berth or not. Laytime continues until the cargo hoses have been
disconnected after the completion of loading or discharging. However, for dry
bulk chartering, the laytime is variable depending on the agreement. Laytime is
normally calculated on the terms of SHEX, which means laytime excludes
Sundays and holidays. Laytime will commence after NOR has been tendered.
Laytime will continue until completion of loading and discharging.

For the interruption of laytime, under tanker voyage chartering, time under
moderate bad weather does count as laytime. Serious bad weather such as
serious typhoon does not count in laytime since it is not suitable for tanker
operation. Any time lost due to faults in the breakdown and inert gas system not
count as laytime. However, under dry bulk chartering, bad weather such as
raining is a common interruption of laytime and thus laytime will not count in
raining. Any time lost due to breakdowns not count as laytime.

There are differences between tanker chartering and dry bulk chartering in
terms of demurrage and despatch. For tanker chartering, despatch money is
rarely paid in tanker charters. If the charter rate of tanker is based on the
Worldscale 100, the demurrage calculation will be employed at the rate of
Worldscale 100. In certain specified circumstances, the demurrage payable shall
be at half rate, reflecting that the market power of charterers is higher. For dry
bulk charter, unlike tanker charter, despatch money is common in dry bulk trades,
except for short sea or coastal trades. Charter rate and demurrage rate are
expressed in terms of dollar per ton and based on market rate and negotiation.
There is no rigid relationship.