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ROLE OF ICD AND
CFS INCONTAINER
MANAGEMENT
CONTAINERIZATION
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WHAT IS A CONTAINER ?
Containers are steel or aluminum boxes that can be moved on trucks, rail
road cars and ships and can carry different kinds of merchandise.
Inaugurated on April 26, 1956, container made shipping cheap, thereby
changing the shape of the world economy.
The container in the last three or four decades has become the core of a
highly automated system that enables movement of goods from anywhere
to anywhere at low costs and with minimum complications on the way
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Pre container era - cost of handling freight at the port was the major part of
the major part of the total freight cost.
Cost of Shipping One Truckload of Medicine from Chicago to Nancy,
France (estimate ca. 1960)
The container idea is not new with Mr. Malcolm McLean - the idea has been in use
British & French railroads used wooden containers to move furniture in late 19th
century
Cincinnati motor terminal company developed interchangeable truck bodies which
could be lifted on and off wheels with a crane
NY Central & Pacific Rail Road used steel containers to be fork lifted and transferred
between trains
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Yet all above were not successful.
McLeans fundamental insight about the container was that shipping
companys mission was moving freight - rather than moving ships.
The container was not just a metal box, but an entire new way of handling
freight - a new system with new types of ports, ships, cranes, storage
facilities, trucks, trains and new organizational and operational
improvements among the shippers.
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Under this new system the benefits ofcontainerization became quickly clear.
Average Cost of Handling One Cubic Meterof Freight - 1970
Capital
Cost
Operating
Cost
Cargo
Handling
Total
CostConventiona l ship $2.30 $3.81 $17.00 $23.11
Containe r ship $2.50 $2.47 $5.90 $10.87
Source: UNCTAD, Review of Maritime Transport, 1975.
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In the light of such cost advantages ofcontainer ships over conventional ships.
There was a boom in container shipping.
Source: UNCTAD
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HISTORY OF CONTAINERIZATION
Modern container shipping celebrated its 50th anniversary in 2006. Almost
from the first voyage, use of this method of transport for goods grew steadilyand in just five decades, containerships would carry about 60% of the value
of goods shipped via sea.
The idea of using some type of shipping container was not completely new.Boxes similar to modern containers had been used for combined rail- and
horse-drawn transport in
England as early as 1792.
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HISTORY OF CONTAINERIZATION
, in 1955, Malcom P. McLean, a trucking entrepreneur from North Carolina,
USA, bought a steamship company with the idea of transporting entire trucktrailers with their cargo still inside. He realized it would be much simpler and
quicker to have one container that could be lifted from a vehicle directly on
to a ship without first having to unload its contents.
On 23 April 1966, ten years after the first converted container ship sailed,
Sea-LandsFairlandsailed from Port Elizabeth in the USA to Rotterdam in
the Netherlands with 236 containers. This was the first international voyage
of a container ship.
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Container shipping began to prove its worth at an international level. From
this point on the industry began to grow to the point where it would quicklybecome the backbone of global trade, even though few at the time would
have made such bold predictions
1968 and 1969 were the Baby Boomer years for container shipping. In 1968alone, 18 container vessels were built, ten of them with a capacity of 1,000
TEUs which was large for the time. In 1969, 25 ships were built and the size
of the largest ships increased to approaching 2,000 TEU. In 1972, the first
container ships with a capacity of more than 3,000 TEU were completed by
the Howaldtwerke Shipyard in Germany
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Now an entire industry had emerged, demanding unprecedented investment
in vessels, containers, terminals, offices and information technology tomanage the complex logistics.
The present-day industry is truly global and touches all our lives in ways we
cannot imagine. In fact, Mark Levinson, a noted economist, suggests thatthe container and container shipping are largely responsible for the growth
of global trade.
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Port Country 1990 2003
Hong Kong China 5.1 20.8
Singapore Singapore 5.21 18.4
Shanghai China 0.5 11.4
Shenzhen China 0.0 10.7
Busan Korea 2.3 10.4
Kaoshung Taiwan 3.5 8.8
Rotterdam Netherlands 3.7 7.1
Los Angeles United States 2.6 6.6
Hamburg Germany 2.0 6.1
Antwerp Belgium 1.6 5.4
Dubai United Arab Emirates 1.1 5.1
Port Klang Malaysia 0.5 4.8
Long Beach United States 1.6 4.7
Qingdao China 0.1 4.2New York United States 1.9 4.0
Tanjung Pelepas Malaysia 0.0 3.5
Tokyo Japan 1.5 3.3
Bremen/Bremerhaven Germany 1.2 3.2
Laem Chabang Thailand 0.1 3.2Gaioia Tauro Italy 0.0 3.0
WorldsLargest
Containerports
Source
:ContainerisationInternationalYearbookandUN
Economic&SocialComm.
forAsia
&thePacific
ContainersHandled (million
20-footequivalents)
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Import Containerized Cargo, 1998-2004:Top 10 US Ports
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Import and Export ContainerizedCargo, 2004: Top 10 US Trading
Partners
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Containerization has reduced shipping costs more
for some than for others.
It costs $2500 to move a container from Baltimore
(USA) to Durban (S. Africa) and $7500 more tohaul it by road the 215 miles from Durban toMaseur in Lesotho.
The cost of transporting a container from a city inCentral City to a port is three timesas much asshipping it from that port to the USA.
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The first perspective is: What are the economicconsequences of the new technological systemsurrounding containers? A variety of economichistorical studies of recent transport technologies -the steamboat, the canal era, the railroad, the
automobile, the interstate system and the jet aircraft- exist. the sharp drop in transport costs. thesetechnologies promoted led to higher mobility, risingregional and international trade and associated
economic development.
There are three perspectives availablewhile examining the major economic
impacts of containerization.
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The second perspective comes from the fact
that the benefits of a physical technology andinfrastructure associated with containerizationare greatly enhanced and indeed multipliedwhen firms using containerization reshapetheir operations and indeed theirorganizational structures to take full advantageof the benefits of containerization.
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ROLE OF ICD
The exporters may take the goods to the ICD/CFS and file the Shipping
Bill and other documents. The goods are examined by the CustomsOfficers and they are stuffed into the containers and thereafter the
containers are sealed. Such containers are transported to the Seaports
(gate way ports) by the Container Corporation of India or any other
authorized agency, either by rail or road, when the containers are loadedinto the vessels (ships) for delivery of the same at the specified foreign port.
In the case of export through ICD, the exporters are requested to file two
additional copies of Shipping Bills known as "Transference Copies" along
with other documents as discussed. The rest of if the procedure is the same
as in the case of exports through Customs Port/Airport.
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ROLE OF CFS
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