TERMS & RULES
The vocabulary of dry bulk chartering, explained the way we’d explain it to a new broker on the desk. Laytime, charter party terms, cargo safety and the Baltic indices — no jargon left unexplained.
LAYTIME & CHARTER PARTY
The agreed window during which the vessel must tender Notice of Readiness. Fixing outside a vessel’s realistic ETA lets the charterer cancel the charter party.
The master’s formal notice that the vessel has arrived and is physically and legally ready to load or discharge. Tendering early is normal — it’s the laytime clock that may wait, not the notice.
The time allowed in the charter party for loading and/or discharging without extra cost to the charterer, usually expressed in days or hours.
Only days that are both working days and weather-permitting count toward laytime. Bad weather, a Sunday or a holiday can pause the clock.
Clauses that let laytime start from a valid NOR even while the vessel waits at anchorage. Without this wording, laytime may only start once she’s actually berthed.
Liquidated damages owed to the owner when the charterer uses more than the allowed laytime, charged per day (or pro rata) at the CP-agreed rate.
The mirror of demurrage: money paid to the charterer, usually by the owner, when loading or discharging finishes faster than the allowed laytime — typically at half the demurrage rate.
Cargo-handling cost allocations. FIO means the owner is free of loading/discharging costs; FIOST adds stowing and trimming to the charterer’s account too.
The contract governing the voyage or time charter. Standard forms like Gencon or NYPE are a starting skeleton — individually negotiated rider clauses usually take priority over the printed form where they conflict.
A port authority or charterer can validly reject a Notice of Readiness if the vessel is not actually ready in all respects, or required documents are missing. An invalid NOR does not start the laytime clock.
Periods under a time charter when the vessel is not fully efficient — breakdown, dry-docking, deviation for repairs — during which hire is suspended under the charter party’s off-hire clause.
CARGO & SAFETY
Cargoes like bauxite fines, nickel ore and some iron ore fines can behave like a liquid and shift if loaded above their TML, risking vessel stability. A valid moisture certificate is essential before loading.
Port or berth draft limits can cap cargo intake well below a vessel’s full deadweight. Always check permissible draft — and any tidal windows — before confirming a cargo quantity.
The total carrying capacity of a vessel — cargo, fuel, fresh water, stores and crew — measured in tonnes at her maximum permitted draft.
The volume a tonne of cargo occupies in the hold. Determines whether a cargo fills the vessel’s cubic capacity before it reaches her deadweight, or vice versa.
The physical separation of incompatible cargoes — such as fertiliser and foodstuffs, or cargoes with different odour or contamination risk — into different holds to prevent damage or claims.
Treatment of bulk cargoes like grain with a pesticide gas to control insect infestation, carried out either before loading, in-transit, or on arrival — each with different crew safety and ventilation implications.
BALTIC INDICES & MARKET
The headline composite index tracking dry bulk freight rates across Capesize, Panamax and Supramax time charter routes, published daily by the Baltic Exchange.
The Baltic Capesize, Panamax, Supramax and Handysize Indices — segment-specific freight benchmarks that feed into the composite BDI.
C3 is the Tubarão (Brazil) to Qingdao (China) route; C5 is West Australia to Qingdao. Both are Capesize iron ore benchmarks — not a general dry bulk reference, and not the right comparison for Supramax or Handysize freight.
A voyage’s net daily earnings once bunkers, port costs and commissions are stripped out of the freight, expressed on the same basis as a time charter rate for direct comparison.
A derivative contract used to hedge or speculate on future freight rates, settled against the relevant Baltic Exchange index rather than requiring an actual vessel or cargo.
Beyond Capesize C3 and C5, the Baltic Exchange publishes named benchmark routes for Panamax (P1A, P3A) and Supramax/Handysize (S1B, S10) that feed into the BPI and BSI.
VESSEL & CARGO TYPES
From Handysize to Newcastlemax, dry bulk vessels are grouped by deadweight tonnage (DWT), which determines the ports, canals and cargoes they can realistically serve.
Iron ore, coal, grain, bauxite, cement and fertiliser each carry different stowage, moisture and segregation requirements that shape which vessel and route make sense.
Geared vessels carry their own cranes and can load or discharge without shore equipment; gearless vessels depend entirely on port cranes, which restricts which berths and countries they can trade to.
A vessel’s classification society certifies that her hull, machinery and equipment meet recognised structural and safety standards — a precondition for insurance, flag state approval and most charterers’ vetting.
REGIONAL CLIMATE & PORT CONDITIONS
The Southwest and Northeast monsoons bring seasonal wind and swell shifts across South and Southeast Asia that affect port workability and passage planning.
Tropical cyclone seasons vary by basin – Bay of Bengal, Northwest Pacific, Atlantic and Australian waters each have distinct windows that can close ports or delay loading.
Baltic, St Lawrence and Russian Far East ports can require ice class tonnage or icebreaker assistance for part of the winter, affecting which vessels can trade there.
Rivers like the Parana, Amazon and Yangtze see draft swing significantly with the season, capping cargo intake well below what deep-water ports allow.
Open roadstead ports along West Africa can suspend cargo operations during heavy Atlantic swell, a real scheduling risk on bauxite and other regional trades.
Panama and Suez transit scheduling, slot availability and vessel size restrictions can materially affect a voyage’s laycan and routing options.
Anchorage queuing caused by berth, crane or stevedore capacity shortfalls. Congestion affects the operator’s ETA planning and interacts directly with laytime and demurrage exposure.
Some ports and river berths are only accessible around high tide, meaning a vessel’s arrival, berthing or sailing must be scheduled against the tide table rather than purely commercial convenience.
COMMERCIAL & NEGOTIATION
The summary message confirming all agreed terms once a fixture is concluded — cargo, laycan, rate, demurrage and any special clauses — which becomes the working reference until the full charter party is signed.
Conditions still to be satisfied before a fixture becomes firm — typically stem/cargo approval, owner’s approval of charterer, and vessel/charterer suitability — agreed to lift within a set time frame.
An agreement to carry multiple cargo quantities over a period — for example ten shipments of 50,000mt over a year — without tying the commitment to specific named vessels for each voyage.
A cargo quantity or type the charterer has the right, but not the obligation, to load in addition to the base cargo — common on part-cargo or multi-commodity fixtures.
A commission the owner pays directly to the charterer (or their nominated party) out of freight or hire, distinct from the brokerage commission paid to the fixing broker.
DOCUMENTATION & BILLS OF LADING
The document issued by or for the carrier that evidences the contract of carriage, acts as a receipt for the cargo shipped, and — where issued ‘to order’ — functions as a document of title.
A provisional receipt signed by the ship’s officer confirming cargo has been received on board, including any remarks on its apparent condition, before the full Bill of Lading is issued.
A letter from the charterer or shipper indemnifying the owner against a specific commercial risk — most often, requesting cargo discharge without the original Bills of Lading being presented.
A clean B/L states the cargo was received in apparent good order with no adverse remarks; a claused (or dirty) B/L records visible damage, shortage or other defect at the time of loading.
A clause incorporating a cargo liability convention — typically the Hague or Hague-Visby Rules — into the Bill of Lading, setting the carrier’s minimum rights, immunities and liability limits.
SAFETY, CLASS & COMPLIANCE
The IMO International Maritime Solid Bulk Cargoes Code sets the mandatory safety requirements for carrying solid bulk cargoes, including which cargoes may liquefy and what certification is required before loading.
Cargoes like nickel ore and some iron ore or bauxite fines can shift from a stable, solid-like state to behave like a liquid if their moisture content exceeds the Transportable Moisture Limit, risking a capsize.
An independent body that surveys and certifies a vessel’s structural and mechanical fitness against published rules — a precondition for insurance, flag registration and most commercial fixing.
Inspections carried out by the port state’s maritime authority to verify a foreign-flagged vessel complies with international safety, pollution and crew standards, independent of her flag state or class society.
A structured risk assessment of a vessel and her operator — covering class, PSC history, ownership stability and safety management — used by charterers, especially industrial and major traders, before fixing.
ENVIRONMENTAL & REGULATORY
The Energy Efficiency Existing Ship Index — a one-off technical rating measuring a vessel’s design efficiency, which existing ships must meet under IMO rules regardless of how they are actually operated.
The Carbon Intensity Indicator — an annual operational rating (A to E) based on a vessel’s actual CO2 emissions per cargo-carrying capacity and distance sailed, published under IMO rules from 2023.
The EU Emissions Trading System now covers shipping, requiring owners to surrender carbon allowances for a phased share of CO2 emissions on voyages calling at EU and EEA ports.
An EU regulation requiring ships calling at EU ports to progressively reduce the greenhouse gas intensity of the energy they use, pushing owners toward lower-carbon fuels and onshore power.
Rules under the IMO Ballast Water Management Convention requiring vessels to treat ballast water to a defined standard before discharge, to prevent invasive species spreading between regions.
ABBREVIATIONS
The forecast time a vessel will reach a port, pilot station or waypoint – continuously updated as the voyage progresses and used by charterers, agents and terminals to plan berth and cargo readiness.
The forecast time a vessel will actually get alongside the berth, which can differ sharply from ETA when a port is congested and the vessel must wait at anchorage first.
The forecast time cargo operations (loading or discharging) will finish, used to plan the vessel’s next fixture, bunkering and onward passage.
The forecast time a vessel will sail from a berth or anchorage, typically firmed up once cargo operations near completion and final documentation is being prepared.
A near-synonym for ETD used at some ports and by some agents specifically for the moment a vessel unberths and gets underway.
The confirmed, logged time a vessel arrived at the port or roadstead, replacing the estimated ETA once the event has actually happened.
The confirmed, logged time a vessel came alongside the berth, marking the point cargo operations can practically begin.
The confirmed, logged time a vessel unberthed and departed, closing out the port call for laytime, demurrage and off-hire accounting.
The confirmed time a vessel actually got underway and cleared the port, used interchangeably with ATD depending on port convention.
The chronological, port-agent-prepared record of every event during a vessel’s port call – NOR tendering, berthing, start/stop of operations, weather delays and completion – used as the primary evidence base for laytime and demurrage calculations.
A laytime basis where Sundays and official holidays count as laytime, unlike SHEX where they are excluded – common in ports with round-the-clock operations.
A laytime basis where Sundays and official holidays are excluded from the laytime count even if cargo work actually happens on those days, unless a further qualifier like ‘unless used’ applies.
A laytime basis, common at ports observing a Friday/Islamic weekend, where Fridays and official holidays are excluded from the laytime count rather than Sundays.
A qualifier attached to an excepted-period laytime clause (e.g. SHEX UU) meaning that if cargo work actually happens during the excepted period, that time does count against laytime after all.
A qualifier meaning the excepted period stays excluded from laytime even if cargo work actually happens during it – the opposite effect to UU.
A laytime basis excluding Sundays and holidays from the count, except that any period actually worked during them is added back in – functionally the same mechanism as SHEX UU, written as a single combined term.
A qualifier on laytime or a specific operation meaning the clock only runs, or the activity only proceeds, during periods when weather conditions allow safe cargo work.
The rate basis for a demurrage, despatch or loading/discharging figure expressed per weather working day rather than per calendar day, so days lost to weather don’t count against the stated rate.
A basis for calculating a part-day allowance or charge proportionally, rather than rounding a partial day up or down to a full day.
A shorthand meaning a term applies at both the load port and the discharge port, most commonly seen in phrases like ‘SHINC BENDS’ or a demurrage rate quoted ‘BENDS’.
An older laytime basis with no fixed laytime allowance at all – cargo is to be loaded or discharged as fast as is customary at that particular port, with no demurrage or despatch calculation applying.
A clause permitting a vessel to safely touch bottom at certain tidal berths or river ports without breaching the charter party’s normal ‘always afloat’ warranty, provided the seabed condition is suitable.
The moment the outward pilot disembarks a vessel departing port, used as the reference point marking the true end of a sea passage’s port-departure phase for laytime, redelivery or bunker-survey purposes.
A cargo quantity tolerance clause giving the shipowner the right to load a stated percentage more or less than the nominated cargo quantity, used to give the vessel flexibility to optimise stowage and draft.
The same tolerance mechanism as MOLOO, except the right to select the final quantity within the agreed percentage band sits with the charterer rather than the owner.
A cargo-handling term meaning the vessel is free of all costs and risks of loading, discharging, stowing and trimming the cargo – the charterer or its agents arrange and pay for the entire cargo-handling operation.
A cargo-handling term meaning loading costs are for the vessel/owner’s account (as in liner terms) while discharging costs are free of expense to the vessel, i.e. for the charterer or receiver’s account.
The mirror image of LIFO – loading is free of expense to the vessel (charterer’s account) while discharging is on liner terms, for the vessel/owner’s account.
Cargo handling using a crane (ship’s gear or shore crane) to lift individual pieces of cargo on and off the vessel, as distinct from RoRo or bulk cargo handled by grab or conveyor.
The maximum length of a vessel measured from the foremost to the aftmost point of the hull, the single most common length figure used for berth and lock/canal fit checks.
A vessel’s length measured between the forward and after perpendiculars (broadly, the waterline length), used in some class, tonnage and older port-fee calculations rather than the full LOA figure.
An older measure of a vessel’s total enclosed internal volume, historically used for port dues, canal tolls and registration – largely superseded by Gross Tonnage (GT) under the 1969 Tonnage Convention but still referenced informally and in some legacy tariffs.
An older measure of a vessel’s usable, revenue-earning volume (broadly, GRT minus non-earning spaces like engine room and crew quarters), historically used for port and canal dues – largely superseded by Net Tonnage (NT) but still referenced in some legacy contexts.
The modern, internationally standardised measure of a vessel’s overall internal volume under the 1969 International Tonnage Convention, used for port dues, canal tolls, manning requirements, safety regulation thresholds and most current commercial and regulatory purposes.
The additional depth (in millimetres) a vessel may legally submerge below her salt-water summer load line when loading in fresh or brackish water, since the vessel will rise back to the correct mark once she reaches salt water.
One of the most widely used standard time charter party forms in dry bulk shipping, published and periodically revised by ASBA, providing a standard framework of clauses that owners and charterers then amend via a rider.
BIMCO’s standard voyage charter party form, one of the most widely used templates for single-voyage dry bulk fixtures, providing a base framework that is then adapted with rider clauses for the specific cargo and trade.
A standard BIMCO time charter party form, historically popular for smaller and older tonnage, offering an alternative framework to NYPE with a different clause structure and risk allocation.
The standard form of contract used for the sale and purchase (S&P) of a ship, distinct from a charter party, setting out the agreed price, delivery terms, inspection rights and other conditions of the vessel’s sale.
A qualifier attached to a figure or piece of information – most often a vessel’s ETA, position, or a cargo estimate – indicating it is given in good faith as the best current estimate but without a binding guarantee of accuracy.
A formal written notice issued by one party (commonly the Master, on behalf of owners) to record a disagreement or reservation about an event without necessarily stopping operations while the dispute is resolved.
Mutual insurance associations that cover a shipowner’s third-party liability risks – cargo claims, pollution, crew injury, collision liability and similar – as distinct from Hull & Machinery insurance, which covers physical damage to the vessel itself.
Marine insurance covering physical loss or damage to the vessel’s hull, machinery and equipment – the shipowner’s own-asset cover, complementing (not overlapping with) P&I’s third-party liability cover.
An IMO code requiring shipowners and managers to operate a documented safety management system covering the vessel’s safe operation and pollution prevention, verified through a Document of Compliance and a Safety Management Certificate.
An IMO code setting minimum security requirements for ships and port facilities engaged in international trade, requiring a Ship Security Plan, a designated Ship Security Officer, and compliant port-facility security arrangements.
An ILO convention (2006) setting minimum working and living standards for seafarers – contracts, hours of rest, accommodation, health care, and complaint procedures – enforced through flag state certification and port state control inspection.
The foundational IMO convention setting minimum safety standards for the construction, equipment and operation of merchant ships – covering areas from life-saving appliances to fire protection, navigation and cargo securing.
The primary IMO convention governing marine pollution prevention, covering oil, noxious liquid substances, harmful packaged substances, sewage, garbage and air emissions across its various Annexes.
An international federation of national shipbroking and agency associations (including the UK’s Institute of Chartered Shipbrokers) that promotes professional standards, provides quality-standard accreditation for agents, and represents the industry’s interests internationally.
