Surface and Sea Transportation

Dr. Vijesh Jain, ILM, FIIB

 Intro
• Surface and Sea Transportation
• These most common five modes of transport
are: railways, roadways, airways, waterways
and pipelines.
• In last 20 years international transport has
grown by 170%
 Surface/Ground Transport
• The oldest mode
• Most Immediate
• Most Flexible
• Most used for shorter distances
• Only means of feeder movement to air and sea
• But most expensive, tiring and polluting mode
of transportation. Have high variable cost for
trucks movements
 Sea/Ocean Transportation
• Most Common
• Most affordable
• Account for 90% of goods movement globally
• Can move larger qty in one go
• But it is slower, perils prone and polluting the
Oceans
 Transportation of goods by Land
• Truck.
 Transportation of goods by Land
• Rail
• Ideally suited for shipping bulk products
• Can be adapted to meet specific product needs through the
use of specialized cars
– tankers for liquids,
– refrigerated cars for perishables,
– and cars fitted with ramps for automobiles
• Most suitable for high tonnage long distance movement
• Less expensive than trucks and air transport in idea
conditions
• Low variable cost
 Transportation of goods by Land
• Intermodal/Multimodal transportation
• Mainly resulted from the introduction of
Containers
 Transportation of goods by Land
• Intermodal/Multimodal transportation Advantages
– Loss of time and risk of loss, pilferage and damage to cargo incidental to the
conventional segmented transport are eliminated
– The movement of cargo is faster
– The burden of documentation and other formalities connected with segmented
transport is reduced
– The resultant cost savings tend to reduce through freight rates and the cost of
cargo insurance.
– The consignor has to deal with only one agency- the multimodal transport
operator in all matters relating to the movement of his goods including settlement
of claims
– The through rates offered by Multimodal Transport Operators (MTO) make it
easier for the exporter to negotiate sales contracts with foreign buyers on the basis
of delivered prices.
 Carriage of goods by Sea
• Type of Cargo
• Bulk Cargo, whether dry or liquid, belongs to the category
of primary commodities such as ores, fertilizers, food
grains, crude oil, petroleum, edible oils etc., and move as
ship loads.
• The Break-bulk or General Cargo on the other hand, refers
to the manufactured or semi-manufactured, processed or
semi processed goods that move invariably in different
types of packing, like cases, creates, bales, drums, rolls,
bags etc., In shipping parlance, these items are generally
referred to as “general merchandise”.
 Carriage of goods by Sea
• Type of Ships
• 1) Ocean Going Vessels
• In this category mostly following type of ships are consider - 
• Bulkers
• In merchant ships bulkers are designed to transport unpackaged bulk cargo,
such as grains, coals, cement and ore in its cargo holds. Container Ships
• The container ship dimensions, such as the ship breadth, depend on the
number of containers placed abreast on deck and in the holds. The average
loaded container weighs about 10-12 tons but, of course, this may vary, so the
modern container ships are dimensioned for 12-14 dwt per TEU. Container
ship capacity is normally expressed in Twenty-foot Equivalent Units (TEU),
• Specialty Ships
• Tankers
 Carriage of goods by Sea
• Container Ships Types
– Panamax Container Ship
– Ships classified as Panamax are of the maximum
dimensions that will fit through the locks of the
Panama Canal
– Suezmax (ULCS) Container Ship
– It is probable that Ultra Large Container Ships
(ULCS) carrying some 12,000 teu containers can be
expected.
 Carriage of goods by Sea
• Ship
Types by
Size
 Carriage of goods by Sea

• Ship
Types by
Size
 Carriage of goods by Sea
• Charter Party
• Chartering is an activity within the shipping
industry whereby a shipowner hires out the
use of their vessel to a charterer.
• The contract between the parties is called a
charter party
 Liner Services Vs Chartering
Liner Services
• Ships designed for multitude
of cargo units (e.g.
containers)
• Cargo documents (e.g. bills
of lading) evidencing the
contract of carriage
• Terminology: carrier/shipper
(receiver consignee)
• Mandatory liability rules
based on conventions
Chartering
• Ships designed for bulk cargoes
• Contract for transportation
service (chartering) of a specific
ship
• Terminology:
shipowner/charterer
• freedom of contract (except for
inter-N di or c voyage
chartering)
 Chartering
Voyage charter,
– voyage charter is the hiring of a vessel and crew for a voyage between a
load port and a discharge port.
– Payment on a per-ton or lump-sum basis.
– The owner pays the port costs (excluding stevedoring), fuel costs and
crew costs.
– The payment for the use of the vessel is known as freight.
– specifies a period, known as laytime, for loading and unloading the cargo.
– If laytime is exceeded, the charterer must pay demurrage.
– If laytime is saved, the charter party may require the shipowner to pay
despatch to the charterer
 Chartering
Time charter,
–  hiring of a vessel for a specific period of time;
– the owner supplies the vessel and crew,
– charterer
• selects the ports, route and vessel speed.
• pays for all fuel the vessel consumes, port charges,
commissions, and
• a daily hire.
The charterer in this sense takes full operational
control of the vessel during the time charter period
 Chartering
Bare boat charter,
– A demise charter, or bareboat charter, 
– no administration or technical maintenance is
included as part of the agreement.
– obtains possession and full control of the vessel
along with the legal and financial responsibility for
it.
– pays for all operating expenses, including fuel,
crew, port expenses and P&I and hull insurance.
 Chartering
• Back to Back Charter
– Concerning a time charter, a back-to-back charter
party is a charter party between a time charterer
and a sub-time charterer further down the
charter party chain
– based on a charter party between the time
charterer and an owner or time charterer that is
further up the charter party chain.