DEMAND, AS IS SATISFACTORY FOR WORLD SHIPPING MARKET, IS OF VITAL IMPORTANCE FOR TRANSPORTATION INDUSTRY. CONCEIVABLY, SUCH DEMAND MAY TURN OUT TO BE HIGHER THAN ECONOMIC CAPACITY, PARTICULARLY WHEN FARE IS LOW. THIS MATTER IS DEFINITELY DEPENDENT ON DEMAND RATE. IN THIS SECTION, FACTORS THAT RELY ON SUPPLY AND DEMAND IN SHIPPING INDUSTRY ARE ANALYZED AS PART OF OUR ANALYSIS ON FACTORS THAT ARE EFFECTIVE IN TRANSPORTATION MARKET. USUALLY DEMAND FOR TRANSPORTATION SERVICE COMES FROM DEMAND FOR COMMODITIES. DEMAND CURVE SHOWS CONSUMERS BEHAVIOR ONLY. MARKET PRICE STANDS AT THE POINT WHERE SUPPLY CURVE AND DEMAND CURVE MEET. DEMAND CURVE SHOWS MAXIMUM AMOUNT OF DEMAND IN COMMENSURATE WITH A PARTICULAR PRICE. HENCE, THIS DEMAND CURVE, ON WHICH WE FOCUS, SUGGESTS MAXIMUM AMOUNTS THAT CONSUMERS DESIRE TO PURCHASE IN LIEU OF A VARIETY OF PRICES. CHANGE IN AMOUNT OF DEMAND TAKE PLACE FOLLOWING A CHANGE IN PRICE OF COMMODITIES. IT CAN BE SHOWN BY DEMAND CURVE. CHANGE IN DEMAND LIES IN CHANGE IN OTHER FACTORS THAT ARE TYPICALLY EFFECTIVE ON DEMAND. A CHANGE OF INCOME, FOR INSTANCE, ENSUES CHANGE IN PRICE OF OTHER COMMODITIES … AND THIS PENETRATES TO DEMAND AS WELL. WHENEVER THERE IS ON REAL DEMAND AND ALL DEMANDS ARE ONLY PRICE ENQUIRES, SUCH DEMAND IS KNOWN A DERIVED DEMAND. THE AIM OF SUCH DEMAND IS NOT FOR SERVICE BUT FOR GETTING TO KNOW THE PRICE OF SERVICE.