- September 9, 2024
- Posted by: admin
- Categories: Export Financing, Blog

Shipping involves many different calculations to ensure that everything runs smoothly and safely. One of the most important things in shipping is called **tonnage**. Tonnage helps measure how much a ship can carry, either in terms of volume (space) or weight.

**What is Tonnage in Shipping?**

**Tonnage** in shipping refers to the capacity of a ship, either by the amount of space inside it or by how much weight it can hold. The word “tonnage” comes from the old practice of charging fees based on how much a ship could carry. These fees were calculated based on the “tons” a ship could handle.

In the past, people used to measure tonnage by looking at the inside volume of a ship. But nowadays, the weight of the cargo is often used as the measurement. A “ton” is the standard unit for this measurement, and it usually means one metric ton, which equals 1,000 kilograms (about 2,204 pounds).

Even though the definition of tonnage has changed over time, it usually refers to the total weight or volume a ship can carry. Simply put, tonnage in shipping is the total number of tons a ship can carry or the total space it has for cargo.

**Who Issues International Tonnage Certificates?**

Tonnage is important for several reasons, including safety regulations, registration fees, port charges, and other rules. Every ship must have an **International Tonnage Certificate (ITC)**, which is issued by the country where the ship is registered, known as the “flag state.” This certificate is issued according to the rules set by the **International Maritime Organization (IMO)** and the **Tonnage Measurement of Ships Convention of 1969**.

Before a ship is delivered, the necessary calculations are made by a special organization, often called a “classification society.” This society checks the ship’s tonnage and issues the certificate on behalf of the flag state. Although this certificate has an expiry date, it needs to be updated if any significant changes are made to the ship.

**What is Tonnage Tax?**

**Tonnage tax** is a special type of tax that is charged to shipping companies instead of the regular corporate tax. This tax is usually lower than traditional taxes, making it an attractive option for shipping companies. The tax is calculated based on the total tonnage of all the ships operated by a company.

One advantage of this system is that it doesn’t depend on how much profit the company makes or the total amount of cargo it ships. This makes the tax easier to calculate for both the shipping companies and the authorities. For example, even if a ship isn’t fully loaded, the tonnage tax remains the same.

**How is Tonnage Calculated?**

To understand how tonnage is calculated, it’s important to know about two key types of tonnage: **Gross Tonnage** and **Net Tonnage**.

Gross tonnage is the total volume of a ship, including all the enclosed spaces from the bottom (keel) to the top (funnel). It is expressed as a measure of the ship’s overall size.**Gross Tonnage (GT)**

The formula to calculate gross tonnage is:

Gross Tonnage (GT)=K1×V\text{Gross Tonnage (GT)} = K1 \times VGross Tonnage (GT)=K1×V

Where:- K1=0.2+0.02logVK1 = 0.2 + 0.02 \log VK1=0.2+0.02logV
- VVV = Total volume of all enclosed spaces in cubic meters

- K1=0.2+0.02logVK1 = 0.2 + 0.02 \log VK1=0.2+0.02logV
- VVV = Total volume of all enclosed spaces in cubic meters

- K1=0.2+0.02logVK1 = 0.2 + 0.02 \log VK1=0.2+0.02logV
- VVV = Total volume of all enclosed spaces in cubic meters

Net tonnage is the volume of the cargo spaces on a ship. It only includes the parts of the ship that can be used to carry cargo. Net tonnage is typically about 30% less than gross tonnage.**Net Tonnage (NT)**

The formula to calculate net tonnage is:

Net Tonnage (NT)=K2×Vc×(4d3D)2+K3×(N1+N210)\text{Net Tonnage (NT)} = K2 \times Vc \times \left(\frac{4d}{3D}\right)^2 + K3 \times \left(N1 + \frac{N2}{10}\right)Net Tonnage (NT)=K2×Vc×(3D4d)2+K3×(N1+10N2)

Where:- K2=0.2+0.02logVcK2 = 0.2 + 0.02 \log VcK2=0.2+0.02logVc
- VcVcVc = Total volume of cargo spaces in cubic meters
- K3=1.25×GT+1000010000K3 = 1.25 \times \frac{GT + 10000}{10000}K3=1.25×10000GT+10000
- ddd = Summer load line draught in meters
- DDD = Molded depth amidships in meters
- N1N1N1 = Number of passengers in cabins with up to 8 berths
- N2N2N2 = Number of other passengers
- N1+N2N1 + N2N1+N2 = Total number of passengers the ship can carry according to its passenger certificate. If N1+N2N1 + N2N1+N2 is less than 13, they are taken as zero.
- GTGTGT = Gross tonnage of the ship

- K2=0.2+0.02logVcK2 = 0.2 + 0.02 \log VcK2=0.2+0.02logVc
- VcVcVc = Total volume of cargo spaces in cubic meters
- K3=1.25×GT+1000010000K3 = 1.25 \times \frac{GT + 10000}{10000}K3=1.25×10000GT+10000
- ddd = Summer load line draught in meters
- DDD = Molded depth amidships in meters
- N1N1N1 = Number of passengers in cabins with up to 8 berths
- N2N2N2 = Number of other passengers
- N1+N2N1 + N2N1+N2 = Total number of passengers the ship can carry according to its passenger certificate. If N1+N2N1 + N2N1+N2 is less than 13, they are taken as zero.
- GTGTGT = Gross tonnage of the ship

- Additional points to remember:
- The factor (4d3D)2\left(\frac{4d}{3D}\right)^2(3D4d)2 should be greater than 1.
- The term K2×Vc×(4d3D)2K2 \times Vc \times \left(\frac{4d}{3D}\right)^2K2×Vc×(3D4d)2 should not be less than 25% of the gross tonnage.
- Net tonnage should not be less than 30% of the gross tonnage.

**Tonnage of a Container Ship**

The tonnage of container ships is calculated using the same formulas as mentioned above. For example, a large container ship with a capacity of 20,250 **TEU** (Twenty-Foot Equivalent Units, a standard measure for containers) might measure about 1,445 feet long and 195 feet wide. This ship could have a tonnage capacity of around 220,000 tons.

**What is Deadweight Tonnage?**

**Deadweight tonnage (DWT)** refers to the total weight of everything on a ship, including cargo, fuel, passengers, crew, food, and water. It is measured in long tons, where one long ton equals 2,240 pounds (about 1,016 kilograms).

**What is Displacement Tonnage? **

**Displacement tonnage** is the amount of water a ship displaces when it is floating. This is measured in cubic meters and represents the actual weight of the ship. When a ship is floating with full fuel tanks and everything on board, the amount of water it displaces is called its displacement tonnage.

A ship’s displacement is equal to the weight of the water it displaces because a floating object displaces the same amount of water as its weight. On the other hand, the **light displacement** of a ship refers to the amount of water it displaces when it has no passengers, crew, cargo, fuel, or food on board.

**Also Read: **LCL Shipments in Logistics and Shipping : Meaning, Costs and More

**FAQs On Tonnage in Shipping**

**What is tonnage length in shipping?**- Tonnage length is 96% of the distance covered by a ship’s waterline at 85% of the least molded depth when measured from the top of the keel. It can also refer to the length from the front of the ship to the axis of the rudder stock on the waterline if that distance is greater.

- Tonnage length is 96% of the distance covered by a ship’s waterline at 85% of the least molded depth when measured from the top of the keel. It can also refer to the length from the front of the ship to the axis of the rudder stock on the waterline if that distance is greater.

**What is the net tonnage of a ship?**- Net tonnage is a measure of the actual cargo-carrying capacity of a ship.

- Net tonnage is a measure of the actual cargo-carrying capacity of a ship.

**How big is a 100-ton ship?**- A 100-ton ship can be around 65 feet long or more, depending on its construction and primary use.

- A 100-ton ship can be around 65 feet long or more, depending on its construction and primary use.

**Conclusion**

Understanding tonnage is essential for anyone involved in shipping. It helps determine the size and capacity of a ship, how much it can carry, and the taxes and regulations it must follow. By knowing the basics of gross tonnage, net tonnage, deadweight tonnage, and displacement tonnage, you can better understand the workings of the shipping industry.

**Also Read: ****Guide to Shipping Internationally From India to Other Countries**