Voyage charter
Meaning
A voyage charter is a contract to carry a cargo between named ports for a freight payment, with the owner running the ship and paying its costs.
Also written as Spot charter, Voyage charter party
Voyage charter explained
Under a voyage charter the owner provides the ship and crew, pays for bunkers, port costs and canal dues (unless agreed otherwise), and is paid freight for the cargo carried. The charterer's commitments are the cargo, the ports and the time allowed for cargo operations, which is laytime.
Most spot tanker business is done on voyage charters, priced in Worldscale points or as a lumpsum, on forms such as ASBATANKVOY, Shellvoy or BPVOY with the parties' riders.
Related terms
Time charter
A time charter hires the ship for a period at a daily rate; the charterer directs its employment and pays for voyage costs like bunkers and port fees.
Freight
Freight is the payment a charterer makes to the owner for carrying cargo under a voyage charter, quoted per tonne, as a lumpsum or in Worldscale.
Laytime
Laytime is the time the charterer is allowed, without paying extra, to load and discharge the cargo under a voyage charter.
Worldscale
Worldscale is the index used to price tanker freight: a route's flat rate is WS 100, and fixtures are agreed as a percentage of it, such as WS 60.
ASBATANKVOY
ASBATANKVOY is the most widely used standard voyage charter party form for tankers, published by the Association of Ship Brokers & Agents (USA).
TCE
TCE (time charter equivalent) converts a voyage's freight into daily earnings: freight minus voyage costs, divided by the days the voyage takes.