Shipping

Shipping

Overview
Shipping has multiple meanings. It can be a physical process of transport
Transport
Transport or transportation is the movement of people, cattle, animals and goods from one location to another. Modes of transport include air, rail, road, water, cable, pipeline, and space. The field can be divided into infrastructure, vehicles, and operations...

ing commodities and merchandise goods and cargo
Cargo
Cargo is goods or produce transported, generally for commercial gain, by ship, aircraft, train, van or truck. In modern times, containers are used in most intermodal long-haul cargo transport.-Marine:...

, by land, air, and sea. It also can describe the movement of objects by ship.

Land or "ground" shipping can be by train or by truck. In air and sea shipments, ground transportation is required to take the cargo from its place of origin to the airport or seaport and then to its destination because it is not always possible to establish a production facility near ports due to limited coastlines of countries.
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Encyclopedia
Shipping has multiple meanings. It can be a physical process of transport
Transport
Transport or transportation is the movement of people, cattle, animals and goods from one location to another. Modes of transport include air, rail, road, water, cable, pipeline, and space. The field can be divided into infrastructure, vehicles, and operations...

ing commodities and merchandise goods and cargo
Cargo
Cargo is goods or produce transported, generally for commercial gain, by ship, aircraft, train, van or truck. In modern times, containers are used in most intermodal long-haul cargo transport.-Marine:...

, by land, air, and sea. It also can describe the movement of objects by ship.

Land or "ground" shipping can be by train or by truck. In air and sea shipments, ground transportation is required to take the cargo from its place of origin to the airport or seaport and then to its destination because it is not always possible to establish a production facility near ports due to limited coastlines of countries. Ground transportation is typically more affordable than air shipments, but more expensive than shipping by sea especially in developing countries like India, where Inland infrastructure is not efficient.

Shipment of cargo by trucks, directly from the shipper's place to the destination, is known as a door to door shipment and more commonly multimodal transport system. Trucks and trains make deliveries to sea ports and air ports where cargo
Cargo
Cargo is goods or produce transported, generally for commercial gain, by ship, aircraft, train, van or truck. In modern times, containers are used in most intermodal long-haul cargo transport.-Marine:...

 is moved in bulk.

Much shipping is done aboard actual ship
Ship
Since the end of the age of sail a ship has been any large buoyant marine vessel. Ships are generally distinguished from boats based on size and cargo or passenger capacity. Ships are used on lakes, seas, and rivers for a variety of activities, such as the transport of people or goods, fishing,...

s. An individual nation's fleet and the people that crew it are referred to its merchant navy
Merchant Navy
The Merchant Navy is the maritime register of the United Kingdom, and describes the seagoing commercial interests of UK-registered ships and their crews. Merchant Navy vessels fly the Red Ensign and are regulated by the Maritime and Coastguard Agency...

 or merchant marine. Merchant shipping is lifeblood to the world economy
World economy
The world economy, or global economy, generally refers to the economy, which is based on economies of all of the world's countries, national economies. Also global economy can be seen as the economy of global society and national economies – as economies of local societies, making the global one....

, carrying 90% of international trade
International trade
International trade is the exchange of capital, goods, and services across international borders or territories. In most countries, such trade represents a significant share of gross domestic product...

 with 102,194 commercial ships worldwide. The term shipping in this context originated from the shipping trade of wind power
Wind power
Wind power is the conversion of wind energy into a useful form of energy, such as using wind turbines to make electricity, windmills for mechanical power, windpumps for water pumping or drainage, or sails to propel ships....

 ships, and has come to refer to the delivery of cargo and parcels of any size above the common mail
Mail
Mail, or post, is a system for transporting letters and other tangible objects: written documents, typically enclosed in envelopes, and also small packages are delivered to destinations around the world. Anything sent through the postal system is called mail or post.In principle, a postal service...

 of letters and postcard
Postcard
A postcard or post card is a rectangular piece of thick paper or thin cardboard intended for writing and mailing without an envelope....

s.

Terms of shipment



Common trading terms used in shipping goods internationally include:
  • Freight on board, or free on board
    Free On Board
    FOB is an initialism which pertains to the shipping of goods. Depending on specific usage, it may stand for Free On Board or Freight On Board. FOB specifies which party pays for which shipment and loading costs, and/or where responsibility for the goods is transferred...

     (FOB) - the exporter delivers the goods at the specified location (and on board the vessel). Costs paid by the exporter include load, lash, secure and stow the cargo, including securing cargo not to move in the ships hold, protecting the cargo from contact with the double bottom to prevent slipping, and protection against damage from condensation. For example, "FOB JNPT" means that the exporter delivers the goods to the Jawahar lal Nehru Port, India, and pays for the cargo to be loaded and secured on the ship. This term also declares that where the responsibility of shipper ends and that of buyer starts. The exporter is bound to deliver the goods at his cost and expense. In this case, the freight and other expenses for outbound traffic are borne by the importer.

  • Cost and freight (C&F, CFR, CNF): Insurance is payable by the importer, and the exporter pays all expenses incurred in transporting the cargo from its place of origin to the port/airport and ocean freight/air freight to the port/airport of destination. For example, C&F Los Angeles (the exporter pays the ocean shipping/air freight costs to Los Angeles). most of the governments ask their exporters to trade on these terms to promote their exports worldwide such as India and China. Many of the shipping carriers (such as UPS
    United Parcel Service
    United Parcel Service, Inc. , typically referred to by the acronym UPS, is a package delivery company. Headquartered in Sandy Springs, Georgia, United States, UPS delivers more than 15 million packages a day to 6.1 million customers in more than 220 countries and territories around the...

    , DHL
    DHL
    DHL Express is a division of the German logistics company Deutsche Post providing international express mail services. DHL is a world market leader in sea and air mail....

    , FedEx
    FedEx
    FedEx Corporation , originally known as FDX Corporation, is a logistics services company, based in the United States with headquarters in Memphis, Tennessee...

    ) offer guarantees on their delivery times. These are known as GSR guarantees or "guaranteed service refunds"; if the parcels are not delivered on time, the customer is entitled to a refund.

  • Cost, insurance, and freight (CIF): Insurance and freight are all paid by the exporter to the specified location. For example, at CIF Los Angeles, the exporter pays the ocean shipping/air freight costs to Los Angeles including the insurance of cargo. This also states that responsibility of the shipper ends at the Los Angeles port.

The term "best way" generally implies that the shipper will choose the carrier who offers the lowest rate (to the shipper) for the shipment. In some cases, however, other factors, such as better insurance or faster transit time will cause the shipper to choose an option other than the lowest bidder.

See also


  • Affreightment
    Affreightment
    Affreightment is a legal term used in shipping.Contract of Affreightment is the expression usually employed to describe the contract between a ship-owner and another person called the charterer, by which the ship-owner agrees to carry goods of the charterer in his ship, or to give to the charterer...

  • Mid-stream operation
    Mid-stream operation
    Mid-stream operation is the operation of loading and unloading cargo containers at the container ship while at sea, with barges or dumb steel lighters performing the transfer, distribution or landing of containers to piers nearby....

  • Ship transport
    Ship transport
    Ship transport is watercraft carrying people or goods . Sea transport has been the largest carrier of freight throughout recorded history. Although the importance of sea travel for passengers has decreased due to aviation, it is effective for short trips and pleasure cruises...

  • Rail transport
    Rail transport
    Rail transport is a means of conveyance of passengers and goods by way of wheeled vehicles running on rail tracks. In contrast to road transport, where vehicles merely run on a prepared surface, rail vehicles are also directionally guided by the tracks they run on...

  • Transshipment
    Transshipment
    Transshipment or Transhipment is the shipment of goods or containers to an intermediate destination, and then from there to yet another destination....

  • Greek shipping
    Greek shipping
    The Hellenic Merchant Marine refers to the Merchant Marine of Greece, engaged in commerce and transportation of goods and services universally. It consists of the merchant vessels owned by Greek civilians, flying either the Greek flag or a flag of convenience...

  • Chinese shipping
    Chinese shipping
    In 1961 the People's Republic of China established a state-run maritime shipping company and subsequently signed shipping agreements with many countries, laying the foundation for developing the country's ocean transport. That organization developed into the present-day China Ocean Shipping Company...

  • Environmental issues with shipping
  • Right of way (shipping)
    Right of way (shipping)
    A right of way in shipping means a collection of all sailing rules on the water roads. It concerns passing, overtaking and priority.In the bigger sense, the right of way concerns also using the lights, signs and signals, the behaviour of sailors during bad weather condition and all of the rules of...

  • Shipping markets
    Shipping markets
    The international shipping industry can be divided into four closely related shipping markets, each trading in a different commodity: the freight market, the sale and purchase market, the newbuilding market and the demolition market...