Introduction
Due to globalization, the world is becoming more interconnected than ever before. It is now possible for customers to buy things manufactured overseas, which will arrive shortly at their doorstep thanks to freight shipping – a method of transporting goods either by land, sea, or air.
Companies are also using freight shipping to remain competitive, as they can expand their scope by entering markets abroad. Unsurprisingly, there is an increase of 12% year over year in the demand for freight shipping. This makes it essential for companies to at least understand the logistics involved, to ensure smooth operations.
What we will focus on
Although there are many freight transportation methods, we’ll be focusing on ocean freight, otherwise known as sea freight, in this article. 90% of the world’s goods travel over oceans and across continents. This freight method is the backbone of exports and imports all over the world. In fact, nearly 200 million containers have been shipped using ocean freight each year. As it is quite cost-efficient, there is no doubt ocean freight shipping will stay around for a long time.
Let’s take a deeper dive into what ocean freight entails.
What is ocean freight?
As its name suggests, ocean freight is a way of transporting large loads of goods by sea, usually via carrier ships. Goods are packed in containers and loaded onto vessels. An average cargo ship can carry around 18,000 containers. This makes sea freight a cost-efficient method of transporting large quantities of goods over great distances. It remains the cheapest freight option and is followed by rail, truck, and air.
There are a few ways ocean freight can transport goods. The most popular way is container shipping, otherwise known as containerization. This method sees goods shipped in containers ranging from 20-40 feet. As container shipping is relatively safe and easy to handle, it is a great option for transporting dry or packaged goods. There are also a few other types of services to choose from:
- Less than container load (LCL): This involves sharing container space with shipments belonging to other people. If you do not have enough cargo to fill up a container space, this is an option you might want to consider. While it is cheaper when compared to shipping with FCL, it is time-consuming. In addition, there is a higher risk of goods being damaged as there are more stops with items being loaded and unloaded. As such, this method is more suitable for small shipments, or shipments that are not urgent.
- Full container load (FCL): Much like its name, FCL shipping means an entire container is dedicated to shipping your goods. This option is a superb choice if you have a huge quantity of goods to transport. Regardless of whether or not your shipment actually fully fills the container, you must still pay the price for a full container. However, it is faster and more secure when compared to LCL. This makes it a better option to ship fragile or time-sensitive goods.
- Roll on roll off (RORO): Unlike the above, RORO is usually used when transporting vehicles such as trucks, cars, buses, trailers or other automobiles. A transporter drives the vehicle directly onto the vessel and drives off when the ship reaches its destination. As such, these ships often have built-in ramps on their bow and stern to make it easier to load and unload vehicles. As the loading and unloading process is extremely smooth, this method is quicker and saves delivery time. There is also less cargo handling involved, which means less risk for accidents to occur.
- Dry bulk shipping: Dry bulk shipping transports unpackaged bulk cargo, such as grains, cement, steel, or coal. These commodities tend to be raw and unprocessed materials for manufacturing. Since the goods are not in containers, transporting them can be risky, with spillage leading to environmental destruction and endangerment of wildlife. As such, these ships need to be specially designed to ensure that accidents do not occur.
You should ensure you understand the differences between the different shipping methods before making a selection. You can also compare costs and shipping times if you are unsure about your options.
How does it work?
Ocean freight shipping often relies on third-party services called freight forwarders. These companies pick up your goods and arrange them properly before loading them onto ships. They then deliver them to the right destination. This is due to how complicated ocean freight shipping is. It makes it better to have an extra pair of eyes and hands that can help correctly transport your goods.
One should label and package all commodities according to shipping and transportation standards. Before setting sail, a shipment goes through customs at the point of origin. At the point of destination, they must pass through customs again before they can enter their destination country legally. This ensures one pays all their taxes, duties, and other charges before delivery.
In the final stages, a transporter takes the goods off the ship and move them to a warehouse or storage facility via road, air, or rail travel. Usually, trucks deliver the commodities to their final destination.
Why use ocean freight?
There are a few reasons to choose ocean freight, especially when it comes to international trading. Here are some advantages:
- Cheaper costs: Compared to other options, ocean freight boasts more cost-effective rates. In fact, ocean freight is often four to six times cheaper when compared to shipping products by air. It is essential to sell the end product at a lower price. By lowering operational costs, companies can achieve that. In the long run, this allows businesses to remain competitive in the market.
- High Shipping Capacity: A major benefit of ocean freight is that it can deal well with large and bulky shipments. These can include vehicles, furniture, construction supplies, and equipment. On the other hand, other shipping options tend to be for lighter products, meaning they cannot accommodate massive items. This is not a problem, as different-sized containers ranging from 20-40 feet can often do the job.
- Eco-friendlier: Unsurprisingly, air and other kinds of transportation often have a higher carbon footprint when compared with marine shipping. More specifically, ocean freight emits less carbon per tonne of cargo. As consumers and businesses become more eco-conscious, this is an increasingly important factor to consider. Additionally, technological advances will see carbon emissions fall to a greater extent in the future, with the International Maritime Organization releasing new regulations to reduce emissions.
- Fewer Restrictions: Although ocean freight can be slower when it comes to shipping items, they have fewer restrictions on what can or cannot be transported. Contrast this with air freight, which has a lot more restrictions, thus making it challenging for customers to transport items straight away. For example, you most likely cannot ship flammable products such as biochemical medicines or perfumes using air freight. Air freight also has restrictions on the weight and size of the shipped item– if the item exceeds its weight classification, it cannot go on planes. Therefore, this means that shipping with sea freight is comparatively easier, and less restrictive when it comes to transporting goods.
Click here to read more on international freight shipping if you are eager to know more about this topic. The article gives great insight into different types of freight shipping services and their benefits. It also offers key aspects to take into consideration before choosing a shipping service.
