5. st International Carriage of Cargo
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Chapter Five
Cargo Transportation
Modes of transportation
Ocean Transportation Air Transportation Rail Transportation Road Transportation Container Transportation International Multimode Transportation (IMT) / International Combined Transportation (ICT) Parcel Post Transportation Inland Waterway Transportation Pipeline Transportation
2010-8-12 Zhou Ruiqi 9
5.1.1 Liner transportation
Additionals 附属费 – under our control
Heavy lift charges / Extra charges on heavy lifts 超重费 (over 5 M/T) Lengthy cargo charges / Extra charges on over lengths 超长费 (over 9m) Bulky cargo charges 超大费 (over 6cbm) Additional on direct 直行附属费
Illustration 1
Suppose
Exporting 100 cases Volume 30x60x50cm Gross weight 40kg, grade 9 Freight basis W/M Basic freight rate HKD109 Bunker surcharge 20%, Currency Surcharge 10%
2010-8-12
Zhou Ruiqi
4
5.1.1 Liner transportation
Types of liners
Conft rate quoted by shipping conference Stable freight rates Regular services
Not at basic port, volume over 1000 M/T
Additional on optional discharging port 选卸港附属费 Additional for alternation of destination 变更卸港附属费
2010-8-12 Zhou Ruiqi 10
(Note: 6000cm3=1kg)
Calculation formula: same as the one for liner freight calculation
2010-8-12
Zhou Ruiqi
15
Illustration 2
Question Consignor A gets one consignment of 10 cartons of leather shoes to transport by air. The measurement of each carton is 50x50x50cm, while gross weight of each is 15kg. How much should the consignor pay to the carrier if the air freight rate is USD1.3/kg? Solution
Q: freight? Solution
30x60x50cm = 0.09m3>0.04 M/T Freight = 0.09 x 109 x 100 x (1+20%+10%) = HKD1275.3
2010-8-12 Zhou Ruiqi 11
5.1.1 Liner transportation
Air Express 航空急件运输
Fastest and safest service Higher freight rate Desk to desk service
2010-8-12
Zhou Ruiqi
14
5.2 Air Transportation
Air freight
W: by weight (kg) M: by measurement (cm3) W/M: by the higher of the two
2010-8-12 Zhou Ruiqi 2
5.1 Ocean Transportation
Advantages
Large capacity Low cost Easy passage: not restricted by road or rails
Disadvantages
Slow Vulnerable to bad weather Less punctual
Criteria for calculating basic freight
W (weight ton) – calculated per metric ton on weight, suitable for heavy goods M (measurement ton)– calculated per cubic meter on measurement, suitable for light goods W/M – on the basis of either weight ton or measurement ton (both under the name of freight ton), subject to the higher one, suitable for goods with high value (Note: 1WT=1MT) Ad Val. (A.V.) – on the basis of value of the goods and expressed in a percentage of the FOB price or value, suitable for goods with high value W/M or A.V. – on the basis of either weight ton, measurement ton or value, subject to the highest one Unit/Head – suitable for goods marked “unit” in the tariff Minimum Rate – suitable for goods in extremely small quantity Open Rate – suitable for goods marked “unit” in the tariff and in extremely large quantity, on the basis of the agreement between the carrier and the consignor
Open rate To be negotiated Figure 5.1 Examples of Liner Freight Rate
2010-8-12
Zhou Ruiqi
8
5.1.1 Liner transportation
Surcharge 附加费 – beyond our control
Bunker Surcharge (bunker adjustment factor / BAF) 燃油附加费 (15% of the cost) Currency Surcharge (currency adjustment factor / CAF) 货币贬值附加费 Congestion Surcharge 港口拥挤附加费 Transshipment Surcharge 转船附加费 Deviation Surcharge 绕道附加费 Port Surcharge 港口附加费
Tramps 不定期船 /charter vessel
Characteristics
No fixed routes No fixed timetables Freight charged on the volume of cargo Suitable for cargo of a complete shipload (eg. bulk cargo)
2010-8-12 Zhou Ruiqi 13
5.2 Air Transportation
Four main types of air transportation
Consolidated Consignment 集中托运
Assembling a number of individual shipments arriving at the same destination into one consignment Dispatched one air waybill
regular scheduled departures specified route routes with fixed base ports comparatively fixed freight rates
Chartered Carriers 包机
The hire of a craft by either total chartered carriers or Partial chartered carriers For consignments of large quantity or reaching the same destination
Calculation formula of liner freight
Total Freight = Total Quantity x Basic Rate x (1+Surcharge / Additional Rates)
2010-8-12 Zhou Ruiqi 6
5.1.1 Liner transportation
2010-8-12 Zhou Ruiqi 7
5.1.1 Liner transportation
Typical Rate Basis W: Weight Ton M: Measurement Ton W/M Ad Valorem (A.V.) Unit Head Minimum rate Examples USD80/Ton USD80/Ton USD80/Ton 0.1% of FOB Value USD60/Unit USD15/Head USD150/B/L
Liner Freight
Inclusive of the loading and unloading cost Inclusive of other costs such as demurrage or dispatch money
Composition of liner freight
Basic freight Surcharges and additionals
Types of ocean transportation
Liner transportation Charter transportation
98% of world trade in volume terms conveyed by sea transport
2010-8-12 Zhou Ruiqi 3
5.1.1 Liner transportation
Characteristics of Liner
regular scheduled departures specified route routes with fixed base ports comparatively fixed freight rates
Types of charters
Voyage charter Time charter Bare boat charter
2010-8-12 Zhou Ruiqi 12
5.2 Air Transportation
Four main types of air transportation
Scheduled Airlines 班机
Non-conference liners
Freight rate quoted by independent carriers or vessel operators Less dependable service High flexibility
2010-8-12
Zhou Ruiqi
5
5.1.1 Liner transportation
Cargo Transportation
Modes of transportation
Ocean Transportation Air Transportation Rail Transportation Road Transportation Container Transportation International Multimode Transportation (IMT) / International Combined Transportation (ICT) Parcel Post Transportation Inland Waterway Transportation Pipeline Transportation
2010-8-12 Zhou Ruiqi 9
5.1.1 Liner transportation
Additionals 附属费 – under our control
Heavy lift charges / Extra charges on heavy lifts 超重费 (over 5 M/T) Lengthy cargo charges / Extra charges on over lengths 超长费 (over 9m) Bulky cargo charges 超大费 (over 6cbm) Additional on direct 直行附属费
Illustration 1
Suppose
Exporting 100 cases Volume 30x60x50cm Gross weight 40kg, grade 9 Freight basis W/M Basic freight rate HKD109 Bunker surcharge 20%, Currency Surcharge 10%
2010-8-12
Zhou Ruiqi
4
5.1.1 Liner transportation
Types of liners
Conft rate quoted by shipping conference Stable freight rates Regular services
Not at basic port, volume over 1000 M/T
Additional on optional discharging port 选卸港附属费 Additional for alternation of destination 变更卸港附属费
2010-8-12 Zhou Ruiqi 10
(Note: 6000cm3=1kg)
Calculation formula: same as the one for liner freight calculation
2010-8-12
Zhou Ruiqi
15
Illustration 2
Question Consignor A gets one consignment of 10 cartons of leather shoes to transport by air. The measurement of each carton is 50x50x50cm, while gross weight of each is 15kg. How much should the consignor pay to the carrier if the air freight rate is USD1.3/kg? Solution
Q: freight? Solution
30x60x50cm = 0.09m3>0.04 M/T Freight = 0.09 x 109 x 100 x (1+20%+10%) = HKD1275.3
2010-8-12 Zhou Ruiqi 11
5.1.1 Liner transportation
Air Express 航空急件运输
Fastest and safest service Higher freight rate Desk to desk service
2010-8-12
Zhou Ruiqi
14
5.2 Air Transportation
Air freight
W: by weight (kg) M: by measurement (cm3) W/M: by the higher of the two
2010-8-12 Zhou Ruiqi 2
5.1 Ocean Transportation
Advantages
Large capacity Low cost Easy passage: not restricted by road or rails
Disadvantages
Slow Vulnerable to bad weather Less punctual
Criteria for calculating basic freight
W (weight ton) – calculated per metric ton on weight, suitable for heavy goods M (measurement ton)– calculated per cubic meter on measurement, suitable for light goods W/M – on the basis of either weight ton or measurement ton (both under the name of freight ton), subject to the higher one, suitable for goods with high value (Note: 1WT=1MT) Ad Val. (A.V.) – on the basis of value of the goods and expressed in a percentage of the FOB price or value, suitable for goods with high value W/M or A.V. – on the basis of either weight ton, measurement ton or value, subject to the highest one Unit/Head – suitable for goods marked “unit” in the tariff Minimum Rate – suitable for goods in extremely small quantity Open Rate – suitable for goods marked “unit” in the tariff and in extremely large quantity, on the basis of the agreement between the carrier and the consignor
Open rate To be negotiated Figure 5.1 Examples of Liner Freight Rate
2010-8-12
Zhou Ruiqi
8
5.1.1 Liner transportation
Surcharge 附加费 – beyond our control
Bunker Surcharge (bunker adjustment factor / BAF) 燃油附加费 (15% of the cost) Currency Surcharge (currency adjustment factor / CAF) 货币贬值附加费 Congestion Surcharge 港口拥挤附加费 Transshipment Surcharge 转船附加费 Deviation Surcharge 绕道附加费 Port Surcharge 港口附加费
Tramps 不定期船 /charter vessel
Characteristics
No fixed routes No fixed timetables Freight charged on the volume of cargo Suitable for cargo of a complete shipload (eg. bulk cargo)
2010-8-12 Zhou Ruiqi 13
5.2 Air Transportation
Four main types of air transportation
Consolidated Consignment 集中托运
Assembling a number of individual shipments arriving at the same destination into one consignment Dispatched one air waybill
regular scheduled departures specified route routes with fixed base ports comparatively fixed freight rates
Chartered Carriers 包机
The hire of a craft by either total chartered carriers or Partial chartered carriers For consignments of large quantity or reaching the same destination
Calculation formula of liner freight
Total Freight = Total Quantity x Basic Rate x (1+Surcharge / Additional Rates)
2010-8-12 Zhou Ruiqi 6
5.1.1 Liner transportation
2010-8-12 Zhou Ruiqi 7
5.1.1 Liner transportation
Typical Rate Basis W: Weight Ton M: Measurement Ton W/M Ad Valorem (A.V.) Unit Head Minimum rate Examples USD80/Ton USD80/Ton USD80/Ton 0.1% of FOB Value USD60/Unit USD15/Head USD150/B/L
Liner Freight
Inclusive of the loading and unloading cost Inclusive of other costs such as demurrage or dispatch money
Composition of liner freight
Basic freight Surcharges and additionals
Types of ocean transportation
Liner transportation Charter transportation
98% of world trade in volume terms conveyed by sea transport
2010-8-12 Zhou Ruiqi 3
5.1.1 Liner transportation
Characteristics of Liner
regular scheduled departures specified route routes with fixed base ports comparatively fixed freight rates
Types of charters
Voyage charter Time charter Bare boat charter
2010-8-12 Zhou Ruiqi 12
5.2 Air Transportation
Four main types of air transportation
Scheduled Airlines 班机
Non-conference liners
Freight rate quoted by independent carriers or vessel operators Less dependable service High flexibility
2010-8-12
Zhou Ruiqi
5
5.1.1 Liner transportation