What is cargo (e.g freight) ?
Cargo consists of goods, materials, merchandise carried onboard of an aircraft, ship, train, or truck. Generally, it consists of goods for commercial gain on which an air waybill, or bill of lading or any other receipt is issued by carrier.
Shipments from point A to point B requires a lot of planning, the mode of transportation is considered as a key factor for successful planning. However, to determine the mode of transportation and the costs of shipment some elements must be taken into consideration:
- Value of the goods
- Weight and volume of the goods
These elements needs to be evaluated before any shipment process, it helps to determine the right mode of transportation, reduce risks, save time and cash.
Sea freight accounts 85 % of the global trade, it’s the main shipping method for global import/export businesses.
Ocean cargo is considered as the best solution for large sized cargoes. Most of the time the size and volume of goods doesn’t fit in any other mode of transportation or is economically unviable to move by other modes of transportation than the ocean.
The main benefit of ocean freight is the low prices comparing to air or rail transportation. Another benefit of ocean freight is size and weight that may involve issues for air transportation.
However, it’s advised to start planning your ocean shipment in advance because it takes longer transit time.
Customs clearance for ocean shipping can take between one to 4 days. it will vary depending on the port of arrival.
In case of LCL load, it is possible that other shipments sharing the same container may cause a delay. Perhaps the cargo’s owner is missing paperwork or not delivered on time.
Ocean freight is preferred mode of transport for large goods (high weight and volume) and heavy cargo such as metals, minerals, iron, and bulk products such as crude oil and petroleum.
Environmental impact is Another factor to take into consideration. We are all taking care of the planet we live on. It seems that sea freight is gaining this category. CO2 emissions are much higher in air travel than ocean freight. This leads to the fact that the transport of goods by air has a much larger carbon footprint than the transport of goods by sea which are considered much greener transportation mode with a higher carrying capacity.
Key benefits of ocean freights:
- Greater flexibility in the material that can be transported and for certain items, it can be the only economical choice.
- Sea transport allows the shipping of greater quantity of materials due to its large storage capacity.
- Most eco- friendly among other mode of transportation
- Multiple carrier options for the shipper
- Extensive coverage around the world
Air freight is a critical mode of transportation to meet the demand for growth, world air cargo shows an average growth of 4.2 percent per year.
High value goods are more likely to be shipped by air freight, like laptops, mobile phones because the shorter transit time decreases the risk of damage or theft. It takes less time to move goods from an airplane to another, more security cameras to keep an eye on the goods.
Air freight is a more expensive option and can be up to 6 times as expensive as ocean freight. However, air freight is much quicker than ocean freight.
For example: An air shipment from Hong Kong to Los Angeles takes around 5 days, while an ocean shipment takes at least 3 weeks.
Key benefits of air transport:
- Fast transition
- Less manipulation
- Less documentation
- Reliable arrival and departure
- Increased security of your shipment
A key element in business “time is money”. So, does the cost of delivery by air increase by increasing speed? technology is constantly accelerating ocean delivery. This is done through better vessels, faster management resources and more accurate communication.
Another “green” mode of transport is rail cargo, train consume less fuel per ton mile than trucks, also it requires only one driver for 100 wagons. Rail cargo is considered as a cheap mode of transportation. However, some additional costs are incurred in a rail journey. The additional costs consist of a road delivery and lift costs to transfer the goods from the road vehicle to the container.
In fact, shorter journeys are cheaper by road and long journeys tend to be less costly by rail.
Trains are able to carry a large number of containers from the delivery ports. Trains are also used to transport steel, wood and coal.
On average trains are used to transport large amounts of goods, and most of the time they have direct destinations which helps to avoid problems like accidents, and road congestion.
By providing the right circumstances, Rail cargo is less expensive than trucking and energy efficient.
A Rail freight from China to Europe, it will save about 70% more than air transport, while the transit time will be reduced by 50% compared with delivery.
Key benefits of rail freight:
- Reliable transit times and schedules
- Railways are the most efficient of land transportation. A train can carry the equivalent of more than 400 trucks.
- Fast and economical delivery over long distances. Generally more than 500 miles
- Rail transportation is traditionally very safe.
- Helps reducing road congestion.
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