Commercial Shipping

1. Commercial Shipping Liner Shipping Market Unit #4

2. Liner Shipping Presented by: Radcliffe Spence

3. Liner Shipping • Liner shipping is the service of transporting goods by means of high-capacity, ocean-going ships that transit regular routes on fixed schedules. • There are approximately 400 liner services in operation today, most providing weekly departures from all the ports that each service calls. • Liner vessels, primarily in the form of containerships and roll-on/roll-off ships, carry about 60 percent of the goods by value moved internationally by sea each year. Presented by: Radcliffe Spence

4. Global Trade • The liner shipping sector moves mostly containerized goods and vehicles. • Liner shipping could lay claim to being the world's first truly global industry. • Likewise it could claim to be the industry which, more than any other makes it possible for a truly global economy to work. • It connects countries, markets, businesses and people, allowing them to buy and sell goods on a scale not previously possible. • And as consumers, we have become used to seeing goods from all parts of the globe readily available in the stores we visit. Presented by: Radcliffe Spence

5. Global Trade • The reality is that the needs of a rapidly growing world population can only be met by transporting goods and resources between countries. • The liner shipping industry has made this process more efficient and changed the shape of the world economy. • This benefits consumers by creating choice, boosting economies and creating employment. • Costs for the consumer are kept down and efficiencies are improved and this in turn minimizes impact on the environment as well. Presented by: Radcliffe Spence

6. Global Trade • The exchange of capital, goods and services across international borders is known as international trade and in many countries it represents a significant share of the nation's gross domestic product (GDP.) • Liner ships transport approximately 60 percent of the value of seaborne trade or more than US $4 trillion worth of goods annually • TRADE ROUTES - Trade between an origin group of countries and a destination group of countries is referred to as a trade route. Approximately 500 liner shipping services provide regularly scheduled service between ports along a single trade route or a group of trade routes. Presented by: Radcliffe Spence

7. Ports • Over 200 countries have ports open to container ships. • Ports measure the volume of containers they handle in twenty-foot equivalent units (TEU). Thus a forty-foot containers would be 2TEUs. • In 2011, containers handled by all ports world-wide (including empties, transshipments and port handling)  were estimated at more than 580 million TEU. Presented by: Radcliffe Spence

8. Landside Connections • Cargo that moves aboard liner ships must be able to move efficiently across land to connect with the ships since the many businesses and consumers that are selling and buying goods are located long distances from a port (multimodal transportation). • The continued efficiencies for global trade gained by the use of liner shipping are dependent upon an inland transportation network that allows for the timely and efficient overland transfer and transport of cargo Presented by: Radcliffe Spence

9. Container • Container shipping is different from conventional shipping because it uses 'containers' of various standard sizes - 20 foot (6.09 m), 40 foot (12.18 m) , 45 foot (13.7 m), 48 foot (14.6 m), and 53 foot (16.15 m) - to load, transport, and unload goods. • As a result, containers can be moved seamlessly between ships, trucks and trains. • The two most important, and most commonly used sizes today, are the 20-foot and 40-foot lengths. The 20-foot container, referred to as a Twenty-foot Equivalent Unit (TEU) became the industry standard reference so now cargo volume and vessel capacity are commonly measured in TEU. Presented by: Radcliffe Spence

10. Container • The container sizes need to be standardized so that the containers can be most efficiently stacked - literally, one on top of the other - and so that ships, trains, trucks and cranes at the ports can be specially fitted or built to a single size specification. • This standardization now applies across the global industry, thanks to the work of the International Organization for Standardization (ISO) that in 1961, set standard sizes for all containers. Presented by: Radcliffe Spence

11. Container • Proper loading or "stuffing" of containers is very important to the safety and stability of the containers and the ships, trucks and trains that transport the containers. • In 2008, the World Shipping Council (WSC), together with the International Chamber of Shipping (ICS), published Transport of Containers by Sea - Industry Guidance for Shippers and Container Stuffers to aid those loading containers. Presented by: Radcliffe Spence

12. Container • In 2010, WSC and ICS issued a joint statement calling on the International Maritime Organization (IMO) to establish an international legal requirement that all loaded containers be weighed at the marine port facility before they are stowed aboard a vessel for export. • Containers are generally constructed of aluminum or steel with each container size and type built according to the same ISO specifications, regardless of where the container is manufactured. Presented by: Radcliffe Spence

13. Container • Shipping containers are available in a variety of types in addition to the standard dry cargo container often referred to as "special" equipment. • These special containers include open end, open side, open top, half-height, flat rack, refrigerated (known as "reefer"), liquid bulk (tank), and modular all built to same exterior lengths and widths as the standard dry cargo containers.  • Containers in the global container fleet equate to more than 34 million TEU. Presented by: Radcliffe Spence

14. Container • Open tops are used for easy loading of cargo such as logs, machinery and odd sized goods. • Flat racks can be used for boats, vehicles, machinery or industrial equipment. • Open sides may be used for vegetables such as onions and potatoes. • Tank containers transport many types of liquids such as chemicals, wine and vegetable oil. Presented by: Radcliffe Spence

15. Container • Every container has its own unique unit number, often called a box number that can be used by ship captains, crews, coastguards, dock supervisors, customs officers and warehouse managers to identify who owns the container, who is using the container to ship goods and even track the container's whereabouts anywhere in the world. • Each container is sealed at the handle of the locking bars for the integrity of the container and its contents. Presented by: Radcliffe Spence

16. Liner Ships • There are almost 6,000 ships, mostly containerships, operating in liner services with most built since 1980. • Liner ships have the capacity to carry several warehouses-worth of goods, which makes one journey very efficient. • In an average year a large container ship travels three-quarters of the distance to the moon. • That means that in its lifetime it travels to the moon and back nearly ten times! Presented by: Radcliffe Spence

17. Container Ship Design • Container ships carry their containers both on and below deck. • Deck-stowed containers on an 11,000 TEU vessel are stacked up to seven to eight high and nineteen across, inter-locked with fittings and secured by special lashings. • Ships generally carry a mix of 20-foot and 40-foot boxes. • Most can also carry 45-foot and 48-foot containers on deck and some can carry 53-foot containers as well Presented by: Radcliffe Spence

18. Container Vessel Fleet • Container ships have grown in size from just 1,500 TEU in 1976 to ships able to carry in excess of 12,000 TEU today, with some ships on order capable of carrying 18,000 TEU. • Today's ships not only are able to carry more goods in one voyage, they are much more fuel efficient. • There are approximately 4,900 container ships in the global fleet most of which are operated by members of the World Shipping Council and there are approximately 600 new vessels on order. Presented by: Radcliffe Spence

19. Container Vessel Fleet • In addition to container ships, the liner vessel fleet includes more than 1,200 Ro/Ro and car carrier ships that transport cars, trucks and other vehicles as well as agricultural and construction machinery. • These ships can also transport cargo too long, too wide or too heavy for movement in standard containers on board container ships. Presented by: Radcliffe Spence

20. Benefits of Liner Trade • International liner shipping is a sophisticated network of regularly scheduled services that transports goods from anywhere in the world to anywhere in the world at low cost and with greater energy efficiency than any other form of international transportation. • It affords small shippers to make regular and timely shipments to their customers(consignees) at affordable price. Presented by: Radcliffe Spence

21. Efficiency • Liner shipping is the most efficient mode of transport for goods. In one year, a single large containership might carry over 200,000 container loads of cargo. • While individual ships vary in size and carrying capacity, many container ships can transport up to 8,000 containers of goods and products on a single voyage. • Similarly, on a single voyage, some car carrier ships can handle 7,600 cars. • It would require hundreds of freight aircraft, many miles of rail cars, and fleets of trucks to carry the goods that can fit on one large liner ship.  Presented by: Radcliffe Spence

22. Container Flow • The huge investments made in containerization have paid off and container traffic is still continuing to grow. Although growth will not be as unbridled as in the past, it will continue until all conventional transport operations have, within a container's limits of capacity and weight, been containerized. • By then, it is estimated that there will be some 8000 ships in operation with a total slot capacity of nine to ten million standard containers. There will be approximately the same number of containers ashore being packed or unpacked, awaiting stuffing or unstuffing or being transferred. Presented by: Radcliffe Spence

23. Container Flow • The majority of these containers are standard 20' box containers. While there are special containers for many applications, growth rates for these are not significant. • The majority of the world's container stocks are owned by shipping companies. • Quite a few are, however, leased in both large and small numbers to ship-owners or other interested parties by leasing companies. • Some forwarders ship goods in their own containers, but these are generally special containers for bulk cargoes, tank containers for chemicals or beverages or coil containers for the steel industry etc. Presented by: Radcliffe Spence

24. Global Economic Engine • Liner shipping connects countries, markets, businesses and people, allowing them to buy and sell goods on a scale not previously possible. • Today, the liner shipping industry transports goods representing approximately one-third of the total value of global trade. • Additionally, as a major global enterprise in its own right, the international shipping industry is responsible for millions of existing jobs and plays a crucial role in stimulating new jobs. Presented by: Radcliffe Spence

25. Global Economic Engine • It contributes hundreds of billions of dollars to the global economy annually thereby increasing gross domestic product in countries throughout the world. • Moreover, as the lifeblood of global economic vitality, ocean shipping contributes significantly to international stability and security. Presented by: Radcliffe Spence

26. Low Environmental Impact • Ocean shipping is the most carbon-efficient mode of transportation and produces fewer grams of exhaust gas emissions for each ton of cargo transported than air, rail, or road transport. • In addition, new International Maritime Organization regulations establish strict standards for vessels' Nox (Nitrogen oxide), Sox(Sulphur oxide, emissions and particulate matter emissions. Also, the millions of containers that are used around the world are now 98 percent recyclable. Presented by: Radcliffe Spence

27. Contracts of carriage • The transport of goods by sea uses a fairly complex legal system that evolved over a long period and is designed to facilitate the orderly flow of trade. • Difficulties may arise from various factors. These include the multiplicity of risks to which goods travelling at sea are exposed, and the obligations and liabilities of the various parties to adequately secure against such risks. • Complications may also arise because two different forms of contract are used, namely, the bill of lading (B/L) and the charter party (CP). • These may be used singly or together. Presented by: Radcliffe Spence

28. Carriage under BOL Contract • Persons wishing to send small parcels of goods by sea must seek out a vessel that contracts to carry cargo to the desired destination port. • Such a vessel may sail regularly along a certain line of ports at advertised times (a liner), or sail from port to port looking for cargo (a tramp). • The legal document used to evidence contract of carriage on these types of vessels is a bill of lading. Presented by: Radcliffe Spence

29. Carriage under BOL Contract • A Bill of lading evidences: a) the loading of goods on a ship. b)It is also evidence of a contract of carriage by sea, in which the carrier commits to carry the gods from one point to another in exchange for the payment of a certain sum of money, called freight. c) it is also a negotiable document of title to the goods; as such, the holder of this document can legally demand the delivery of the goods from the carrier. Presented by: Radcliffe Spence

30. Content of Bill of Lading • No legally specified B/L form is required. • In fact, all shipping lines may have their own form of bill of lading. • However, in general, a B/L contains a number of expressed or implied clauses and some of its contents are usually regulated by national law. • On its face are statements identifying or describing the carrier, the ship, the shipper, the consignee the consignment, the voyage, and sometimes the value of the cargo. • The reverse of the document contains various clauses governing the relationship between the carrier and the holder of the B/L. Presented by: Radcliffe Spence

31. Carriage under charterparty • A charterparty is a contract between a ship owner and the person requiring use of the ship. • Bills of lading may also be issued by charterers. • There are various types of charterparties, the main types being: • Time charterparty; • Voyage charterparty; and • Demise/Bareboat Charterparty Presented by: Radcliffe Spence