Shipping Trends

Refrigerators on Ocean

May 19, 2013 By Gozde Koksal Leave a Comment

Have you ever thought how foods such us fruits, fish, vegetables travel across the world to the USA? Since first cargo container invented in 1950’s ocean shipping industry improved with high technology. Shipping food products became much more easier than before with a high tech reefer containers. International trade is getting global and technology enables us to reach different foods and goods from different counties. Now we can easily find tropical fruit or vegetables in off-season when you go to your local supermarket.

Special refrigerated containers that commonly called reefers, is one of the biggest improvement in the shipping industry. They provide us with tropical fruits and veggies off-season. Reefers can control temperatures, allowing everything from fish, fruit, meat, and vegetables to pharmaceuticals traveling big distances from far lands. Moreover, refrigerated containers offer more energy efficient ways to move fresh products from point A to point B.

Reefer containers generally come in 20 foot and 40 foot lengths, with the same general dimensions as that of dry cargo containers of the same size. Though, there is just a little less space available inside the reefer container due to the space occupied by the refrigeration unit and ventilation equipment. Some reefers also allow the atmosphere in the container to be controlled so for example, bananas can be shipped between continents without turning brown. [Read more...]

Filed Under: Shipping Trends

China VS South East Asia

April 8, 2013 By Serkan Kavas Leave a Comment

China is no longer the sole player in supplying certain products (such as textiles and low end consumer products). The rise of the South East Asian countries for recent years can not go unnoticed, and in the upcoming years they will be more dominant. China has been growing and the wealth is visible at especially the coastal cities. The buying power of the Chinese citizens is increasing day by day. Labor cost in coastal China has skyrocketed, not only for the skilled workers but also for the basic workers. As Chinese wages soar, buyers are looking elsewhere. South-East Asia could be the next big thing. Speaking of the garment industry specifically, China still dominates the business. It supplies nearly half of the European Union’s garment imports and 41% of America’s. But more orders are shifting to lower-wage economies such as Cambodia and Vietnam, which is already the second-largest supplier of clothes to America.

Southeast Asian container shipments to the U.S. and Europe are rising as much as 10%, as manufacturers move production from China because of lower costs, according to cargo-booking technology provider Inttra. Vietnam, Malaysia and Thailand are among Southeast Asian countries to have benefited from trade shifts. They increased their production of consumer goods and of components that are shipped to other countries for final assembly. Low-cost manufacturers have been moving from China because the yuan has strengthened about 7% against the dollar in the past two years. In terms of labor costs, the cost to company per employee is increasing across China due to uneven supply, high demand, inflationary pressure, organized labor demands, and growing social spending requirements. But Western China still offers very reasonable wages for skilled and semi-skilled labor. [Read more...]

Filed Under: General Business, Global Trade, Shipping Trends, Supply Chain Planning

Basic Modes of International Transportation

April 1, 2013 By Onur Akarca Leave a Comment

International transportation can be a complex mode of serious shipping or it can be a simple way of moving the cargo from point A to point B. In the end, transportation is to bring your product from one end to the other in the most cost efficient way and in a timely manner. Most companies prefer to deal with logistic companies who can offer combinations of shipping methods. As an importer, depending on your industry needs, you may require different methods of cargo transportation.

Dealing with a single logistic company who can offer ground, air and ocean transportation can save you money and provide additional value-added supply chain services.

What are the different modes of transportation and which service is more suitable for your business?

It is all depends how urgently you need your cargo or what is your buying volume.

AIR FREIGHT:
It is the fastest way to ship your cargo but it is costly. Air freight is your best option for time sensitive cargo. As an importer when you are in a rush to bring your cargo to its final destination, air freight is the fastest and most secure way. Using a 3-4 day transit time air carrier service is always less costly then direct air carriers. Ask your logistics partner to offer you several air cargo carrier options. Based on your need choosing a longer transit time air carrier option can save you money. [Read more...]

Filed Under: Global Trade, Shipping Trends, Supply Chain Planning, Uncategorized

China’s Effect on The Global Commodity Prices

March 18, 2013 By Rojda Akdag Leave a Comment

Globalization has been the driving force of developing countries for the last decade or so, and trade from these countries flourished as a consequence of China’s close to double digit growth numbers. Although Chinese suppliers rely mainly on local companies to supply the raw materials, a significant number of raw materials are also outsourced by other countries. Top commodities that make up the list consist of: plastics (where it’s widely used almost in every sector), metals (silver, copper, steel), rubber and paper. If we look at the numbers per industry, where most of the imports of raw materials are used, the electronics industry tops the list with 30% of all raw materials used are imported from another country. Given the large amount of electronics shipped from China to all parts of the world, 30% seems to be a highly significant number where even small changes in demand effect the prices of commodities. Another interesting statistic is that per IMF numbers 40% of the world’s base metals (aluminum, copper, lead, zinc or nickel) is consumed by China to manufacture new products. [Read more...]

Filed Under: China, Global Trade, Shipping Trends

United States’ Free Trade Agreements

March 11, 2013 By Nick Akca 2 Comments

Doubling the United States’ exports over the next 5 years may sound like a lofty goal after a catastrophic 2009. But the gradual increase of US exports in goods of 46% from 2009 to 2012 makes this goal quite feasible in my opinion. US exports in goods reached 1.56 trillion in 2012 and 0.63 trillion in services totaling 2.19 trillion. Free trade agreements are undoubtedly one of the best tools for US exporters to expand their sales.

The purpose of a free trade agreement is to allow faster and more business between 2 or more countries, it covers many aspects of government activities and the main goal of FTAs for the United States is to reduce barriers to US exports by reducing or removing the tariffs charged on all qualified products. Currently the United states has 14 free trade agreement in effect with 20 countries which I believe might be useful for many exporting companies. Australia Free Trade Agreement entered into force on January 2005. Duties on more than 97% of US non-agricultural tariff lines became duty free from day one of the agreement. The main US exports to Australia in 2010 were in the sectors of machinery, vehicles; not railway, optic/medical instruments, and electrical machinery. [Read more...]

Filed Under: Global Trade, Shipping Trends, Supply Chain Planning

3PL – Third Party Logistics

March 4, 2013 By Melike Cimen Leave a Comment

Third party logistics companies provide logistics services for their client for part, or all of their supply chain management functions. Most of the providers have combined operation like warehousing and transportation services which can be customized according to their customers’ needs.

Customers’ need and market conditions often set the specialty of the provider. If you think about the entire supply chain operation, starting from manufacturing, to packaging, labeling, transportation, warehousing and distribution, there are a lot of steps, requirements and demands involved. Companies may choose to outsource any of these steps of the supply chain to a third-party logistics provider. Outsourcing services to providers may help cut transportation costs, reduce inventory, improve business processes, technology strategy and integration, manage supply level and improve customer service.

We even see today some experienced import and export companies providing some of their services to other companies because of their well established infrastructure and technology.

There are 4 types of 3PL providers and each of them specializes in different services: [Read more...]

Filed Under: General Business, Global Trade, Regulations, Shipping Trends, Supply Chain Planning

Is Your Cargo Damaged? Here is the Cargo Claim Procedure:

February 25, 2013 By Nergis Isikli 1 Comment

It is nothing but natural to feel uneasy whenever we hear the word damaged. May it be a single little item you purchase on the internet or your container as an importer and exporter you want it to reach its destination safe and sound. As a freight forwarder let me assure you that we want your cargo to be delivered without any damage as much as you do . However when it is inevitable, we must know the steps to be taken afterwards. Although the importance of it is not quite realized at the time of the shipment, Incoterms is the first thing shippers and consignees must look at once the news of damage comes up.

We covered the topic of Incoterms in previous articles, however needless to say, responsibility of the parties are determined depending on the term of the shipment. Also as your freight forwarder we strongly recommend to purchase cargo insurance which must be completed before the shipment is loaded since the insurance coverage provided may not cover the damage occurred, the covered declaration can be found at the back of each Bill of Lading. [Read more...]

Filed Under: Global Trade, Insurance, Regulations, Shipping Trends, Supply Chain Planning

LCL – Less Than Container Load

February 11, 2013 By Ethan Huang 1 Comment

The shipping term (LCL) is commonly used to describe an international ocean freight service that was designed for shipping boxed, crated or palletized cargo from or to the USA that can’t fill an entire 20′ or 40′ foot container. When you are shipping LCL cargo you are paying for the space that you use in the container, and LCL cargo ocean freight rates are calculated by the volume (per cubic meter/cubic foot) but not by the weight.

There are many advantages in using LCL service for your international shipments:

• It will decreases the shipping cost, you are paying for the portion of the space you are using.

• For inland, you can either drop or pick up the cargo from the CFS/bonded warehouse where they load or unload the container.

• Transit time will be the same as if you would have ship a full ocean freight container.

• International moving company can also palletize smaller boxes to eliminate shipping cost extra volume charges.

As with everything in life, there is a downside to shipping LCL. Here are some disadvantages of shipping LCL rather than FCL: [Read more...]

Filed Under: Global Trade, Shipping Trends, Supply Chain Planning

The After Life of a Container Vessel

February 4, 2013 By Emre Reyhan Leave a Comment

Huge container vessels are the backbone of the shipping industry. When we think of cargo ships, the picture that pops up in our minds are gigantic steel constructions that sail on the blue water. That picture is amazing! What about the other side of that picture? What happens to those amazing steel constructions at the end of their time? There are many different methods for disposing of ships;

Hulking
Ship Breaking
Use as an artificial reef
Donation
Sale for re-use
Floating (or drydock) storage
Deep water sinking

Ship breaking is the most common method of ship disposal, which is a type of ship disposal involving the breaking up of ships for scrap recycling. Ship breaking allows materials from the ship, especially steel, to be recycled. Equipment on board the vessel can also be reused. There are also other ways to dispose of the ship such as, floating, use as an artificial reef, deep water sinking, or hulking.
Because of the labor cost and less environmental regulations on ship breaking, most of the ship breaking yards are located in developing countries such as Gadani in Pakistan, Aliaga in Turkey, and Chittagong in Bangladesh.

[Read more...]

Filed Under: Global Trade, Regulations, Shipping Trends

How does Container Security Iniative (CSI) affect your cargo?

January 28, 2013 By Peter Yang Leave a Comment

Delay of your cargo is sometimes caused by natural phenomenons such as extreme weather conditions or technical issues, but a majority of the time the reason behind your delay is U.S. customs. Ever since the September 11 tragedy, U.S. Customs have taken drastic measures to beef up its border from contrabands ranging from personal goods to warfare weapons. Let’s take a look into the actions from U.S. Customs in protecting its border, and the affects these measures have on your shipments.

It’s estimated by U.S. Customs that over 11 million cargo containers are coming into the U.S. every year. In order to better protect its border, U.S. Customs with the support of The World Customs Organization (WCO) and the European Union (EU) launched the Container Security Initiative (CSI). The CSI operates in 58 ports worldwide, covering most regions in Asia, Europe, Africa, the Middle East, North, Central and South America.