Water Transportation

Back to: COMMERCE SS1

 

Welcome to class!

In today’s class, we will be talking about water transportation. Enjoy the class!

Water Transportation

CONTENT

• Types of water transportation
• Terminologies connected with water transportation

Types of water transportation

1. Inland Water Transport: This type of water transport operates within a nation’s borders. Goods and people are moved from one place to another through the rivers, canals, creeks and lakes e.g. River Niger and River Benue. Boats, canoes, ferries and launches are used in inland water transport.
2. Sea Transport (International Water Transport): This involves the movement of good (cargoes) and people from one country to another on the seas and oceans. The vessels employed in this regard include ocean liners, coastal liners, tramp liners, tankers and container ships. Sea transport is very important in international trade.

Means of transportation by sea

1. Ocean liners: These are ships that sail through the high seas and oceans of the world at scheduled times and on set routes. They charge standard fixed freights and are bigger and faster than tramp liners. Ocean liners are sub-divided into:
2. Passenger liners: These are passengers carrying ships following fixed routes. They have to move at fixed times and therefore sail whether they have full complement (number) of passengers or not. They are luxurious and very comfortable.
3. Cargo liners: These are ships which carry heavy and bulky goods from one place to another on the high seas and oceans. Cargo liners operate on a specific time table and they normally run on definite routes. They can also carry a few passengers.
4. Coastal liners: These are flat – bottom streamers that are used to convey goods along the coast to the main port. They can go through the creeks and rivers easily. Coastal liners are mostly used to carry raw materials and primary products to and fro the main port where the cargo liners are docked. They are sometimes called LIGHTERS OR TUGS.
5. Tankers and Supertankers: These are specially designed ships used in carrying crude oil, refined petroleum products and sometimes liquefied gas.
6. Tramp liners: These have no fixed routes nor fixed time-tables. They carry cargoes where they are found and leave when they have loaded sufficient cargoes. They are available for general hire. i.e. they are most often chartered by traders for a given period or a particular voyage. They operate as SEA-TAXIS. Their charges are not fixed i.e. charges can be bargained.

Differences between Tramp Liners and Ocean Liners

S/N	Tramp Liners	Ocean Liners
1.	They have no specific route	They operate on a specific route
2.	They have no fixed timetable	They operate on a specific timetable
3.	They have no fixed rate of charges	They charge standard rates of freight
4.	They may not be luxurious	Passenger liners are luxurious
5.	They handle only cargoes	They handle both cargo and passengers
6.	They are available for general hire	They are booked in advance
7.	They are relatively smaller in size	They are relatively bigger in size

Shipping conferences

A shipping conference is an association of all the shipping companies serving any particular route formed to protect members’ interest and to better serve the shipper (i.e. one who sends goods by ship)

Functions of shipping conferences

1. To maintain freight rates at a particular margin
2. To ensure that a sufficient minimum of cargo is always available for regular services
3. To provide regular sailings and the assurance of definite delivery dates to shippers
4. To ensure a measure of security for shipping operations.

Evaluation

1. State five differences between a tramp liner and an ocean liner
2. List four features of cargo liners.

Special terms connected with transportation

• Charter party:

A charter party is a contract (agreement) by which a merchant hires (leases) a ship or an aircraft for the carriage of goods or passengers either for a particular voyage (journey) or during a specified period, for a sum of money called freight.

Types of a charter party

1. Voyage Charter: In this type of contract the charterer (i.e. the one hiring the ship) hires the ship for his use during a particular voyage.
2. Time Charter: Here, the charterer has the ship at his disposal for a determined period e.g. six months – during which any number of voyages (journeys) can be made. Note: In both voyage and time charter possession of the ship remains in the hands of the owner of the ship and navigation is carried on by the owner’s servants (i.e. captain and crew).
3. Charter by Demise: The charterers of the ship makes all the arrangements for navigation of the ship. The charterer has complete control over the ship and crew and may order the ship to go to any port or to carry any cargo.

• Common carriers and private carriers:

A common carrier is a person or firm who undertakes as a regular business to transport goods from one place to another for anyone willing to pay a reasonable charge.

A person who carries passengers as part of his business (e.g. taxi-driver) and anyone who makes special contracts with each of his customers (e.g. a furniture mover) is not a common carrier.

A private carrier is one who reserves the right to choose his customers, or who undertakes to carry goods only as a casual operation.

Terminologies used in the transport industry

1. Dead Freight: This is the freight paid on unoccupied space in the ship. If there is space left in the ship, the person that charter must pay for the space used.
2. Manifest: A document which shows a full list of the cargo carried by ship or aircraft.
3. Lay days: The specific period of days allocated to a ship to complete its loading and unloading at the docks or harbour.
4. Demurrage: The extra charge or penalty paid for failing to off-load a ship within a stipulated time. It is paid by the charterer.
5. Dispatch money: Payment by the shipowner to the charterer for lay days not used by the charterer.
6. Lump-Sum Freight: This is the amount agreed to be paid by a charterer irrespective of the number of goods shipped and whether or not he loads a full cargo.

Evaluation

1. Define the term charter party
2. Mention and explain the three forms of a charter party

General evaluation

1. Explain five advantages of large scale retailing
2. Explain the following: A. counter trade     B. invisible trade     C. entrepot trade
3. State five barriers to international trade
4. List and explain six factors that will determine a seller’s mode of transportation
5. State seven advantages of international trade

Theory

1. What is transportation by pipeline?
2. Who is a common carrier?

Reading assignment

1. Essential Commerce for SSS by O.A. Longe Page 100-110
2. Comprehensive Commerce for SSS by J.U Anyaele Page 214 – 228

 

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