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UNDERSTANDING SEA FREIGHT

Updated: Aug 6, 2022

If you are managing your business while worrying about all those large cargos, you may want to take a break. Being aware of the appropriate transport medium will be helpful. You may learn that and so much more thanks to this blog!



Sea Freight is a means of shipping huge quantities of commodities by sea. After being packaged in containers, the goods are put onto a vessel. Sea freight is an economical way to move huge amounts over long distances because a typical cargo ship can carry up to 18,000 containers. It is the most common mode of transport that importers and exporters use - almost 90% of commodities are carried via sea freight and ocean freight.


Why Ship By Sea?


Capacity and Value - one container can hold up to 20 -25 metric tons of materials, thus it's both large and affordable. Ocean freight is also less expensive. Any shipment that weighs more than 500 kg is generally too expensive for air freight.


Fewer restrictions - What commodities are deemed risky for shipping is determined by a combination of international, national, carrier organization, and individual carrier rules as well as other factors. In general, more products are limited as air cargo than as ocean freight, including gases (e.g., lamp bulbs), all things combustible (e.g., perfume, Samsung Galaxy Note 7), toxic or corrosive items (e.g., batteries), magnetic substances (e.g., speakers), oxidizers and biochemical products (e.g., chemical remedies), and public health threats (e.g. untanned hides).


Emissions - When compared to air freight, ocean freight emits a tiny amount of CO2. 2 tonnes transported over the ocean for 5,000 kilometers will result in 150 kg of CO2 emissions as opposed to 6,605 kg of CO2 emissions when transported by air.


How it works?


Sea freight is handled by freight forwarders. They act as a third party, picking up, organizing, and delivering your products. Once you've contracted with a shipping company, they will pick up the products from your supplier and transport them through the port.  It is important to note that delivery times should include a delay as they pass through customs on each side of the port.


Sea Freight is available in two varieties: Full Container Load (FCL, 20' and 40' containers) and Less Than Container Load (LCL) (LCL). Additionally, there are three standard container sizes: 20', 40', and 40'hq (40' high cube).


When is the right time to ship full containers (FCL) and less containers (LCL)?



It would seem that shipping full containers when you have enough goods to fill them and LCL otherwise is the obvious solution. Not entirely true.


A full container that is at least 75% full is typically more affordable than shipping LCL (in other words, LCL has around a 25 percent pro-rated surcharge). There are also two additional crucial factors to take into account. First, compared to FCL, LCL travel times are about 1-2 weeks longer. This is due to the fact that the freight forwarder must pack and unpack your things with other customers.


Ocean freight has high fixed costs and several surcharges


When an ocean freight consignment arrives in your country, there are a lot of unexpected costs. You might be surprised by the number of fees that are included on your freight forwarder's invoice in addition to the real ocean freight. Here are some examples of fees you might incur:

  • $50 to $100 in dock fees

  • Administration Fee for Freight Forwarders: $75 to $200

  • $50 to $100 in security fees (normally on Full Container Loads)

  • $100 to $200 in customs clearance fees (plus any relevant tariffs or taxes)

  • Final truck transportation will cost more than $200 from the bonded warehouse to your door (unless you pick up your shipment yourself)


Customs clearance costs and final truck transportation are the last two fees, which you can handle independently. In truth, no one ever does.


How long does it take?


In general here are some rough shipping times from China to various ports:

Shanghai - Gdańsk - 35 days

​Guangzhou - Gdańsk - 38 days

Shanghai - Hamburg - 31 days

Guangzhou - Hamburg - 33 days

Shanghai - New York - 26 days

Guangzhou - New York - 29 days

Shanghai - Sydney - 15 days

Guangzhou - Sydney -18 days

Shanghai - London - 35 days

Guangzhou - London -37 days

Shanghai - Vancouver - 22 days

Guangzhou - Vancouver - 24 days

These times vary greatly depending on the route and other circumstances, but they are close enough. They do not take into account the time it takes to load and unload containers, which can potentially extend these transit durations by days, if not weeks.


What Are the Drawbacks of Ocean Freight?


Speed - Airplanes are approximately 30 times quicker than ocean liners; passenger jets travel at 575 mph, whereas slow-steaming ocean liners go at 16-18 mph. So it comes as no surprise that a package traveling by air freight from China to the US typically takes at least 20 days longer than one traveling by ocean freight.


Reliability - Compared to air freight, ocean freight typically takes longer to deliver due to port congestion, customs holdups, and severe weather. Air freight tracking technology is currently frequently more sophisticated than maritime freight tracking. This indicates that compared to air freight, ocean freight is more likely to be lost. Particularly when the maritime freight is smaller than a container load, this is true. However, with the advent of technology, ocean freight is becoming more dependable.


Protection - Compared to air cargo, ocean freight has a higher risk of being damaged or lost. This is because it is in transit for a much longer period of time, and ships are more prone to movement. However, you shouldn't be too concerned about maritime freight falling off ships. As opposed to the urban myth's claim that 10,000 containers are lost annually, in fact 546 out of each year's 120 million containers are lost.


Conclusion


Hopefully, this has given you a thorough understanding of how international sea freight operates. The first (or second) time you import from China may be scary. However, once you are familiar with the complexities of sea freight, it will come naturally.


If you're still having trouble, Sourceware can help you arrange this process and reduce the time and expense of shipping goods by sea. Please feel free to ask any questions you may have concerning sea freight in the comments section below or by email sourceware@qq.com

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