CAB Unit 1 -Dr.Harris kumar

UNIT 1 -CAB
Prepared byProf.Harris Kumar

CONTAINERIZATION AND ALLIED BUSINESS -
SyllabusUNIT –I BASIC CONCEPT OF CONTAINERIZATION
Introduction to Liner Shipping industry - Unitization concept and methods - Malcolm Mclean and the birth of
containerization - Generations of container ships and their specification - Container types, their specifications and cargoes carried in
them.
UNIT –II FREIGHTING AND SIZE OF CONTAINER
Container shipping business - FCL and LCL sea freight products - Freighting of FCL and LCL cargo - Slot utilization strategies
- Estimation of optimum container fleet size - Multiport LCL consolidation
UNIT – III CHARACTERISTICS AND PHYSICAL OPERATIONS
Containerisation: Concept, Classification, Benefits and Constraints, Container terminal business- World’s leading container
terminals and location characteristics - container terminal infrastructure - container terminal productivity and profitability-Inland
container Depots(ICD)Roles and functions - Container Freight Stations(CFS),Clearance at ICD, CONCOD,ICD's under CONCOD, Charting:
Kinds of Charter, Charter Party and Arbitration.
UNIT – IV CONTAINER TYPES AND BUSINESS
Container manufacturing trends - Container leasing business - Types of container leasing and their terms - maintenance
and repair of containers - tracking of container movements - Container interchange.
UNIT – V MULTIMODAL TRANSPORT
Alternate uses of containers -marketing of used containers -carriage of shipper own containers - multimodal transport
options for containers -Insurance for containers -strategies for managing container imbalance.
• Freight -Goods transported in bulk by truck, train, ship, or aircraft.‘a decline in the amount of freight carried by rail’

CONTAINERIZATION AND ALLIED BUSINESS
COURSE OBJECTIVES:
• To provide an overview of the various elements of containerization
and allied businesses
• To realize the potential of containerization and allied businesses
• OUTCOMES:
• The students will learn the practices and ways to promote
containerization and allied businesses
• The learners will have a complete idea about the different concepts,
trends and strategies used for containerization and allied businesses

About CAB
• Easy Paper to clear comparing to other logistics papers
• Very small amount of Technical Terms
• Repetition of terms with other units
• Diagram can be included to explain
• Easy to understand

Liner Shipping
Liner shipping is the service of transporting goods by means of high-
capacity, ocean-going ships that transit regular routes on fixed
schedules. There are approximately 400 liner services in operation
today, most providing weekly departures from all the ports that each
service calls. Liner vessels, primarily in the form of containerships and
roll-on/roll-off ships, carry about 60 percent of the goods by value
moved internationally by sea each year.

Advantages of Liner Shipping
• Capacity: Liner ships can carry a lot of goods. This is one of their key
advantages over air shipping. Also, the shape of what you need to
transport doesn't matter. You can pick the ship to match your cargo.
Heavy machinery, cars, and plastic bottles for recycling can all be
carried on a liner ship.
• Cost: Shipping is simply the cheapest way to transport goods, which is
why its a method used by many companies. If time isn't important, a
ship is the way to go. Also, if you don't have an entire shipload, you
can share space and cost on a cargo ship with other businesses.

Disadvantages of Liner Shipping
• Speed: It's not the fastest way to get cargo from one place to another.
That's the major downside of liner shipping. An air shipment may take one
or two days, while a liner shipment could take a month or more.
• Reliability: Ships are unreliable in terms of time of arrival. They run on a
weekly schedule and delays can be common. They are reliable in terms of
maintaining the quality of the goods they are shipping, but if customers are
waiting on the other end, it could hurt your business if you rely only on
ships.
• Ship technology continues to improve, and shipments made by ocean will
likely be faster one day. Today they remain a cheap source of transport for
a huge amount of cargo, but if you want something delivered quickly, ship
it by air.

Load Unitization
Load unitization is an efficient means of packaging, arranging and
transporting products into an appropriate unit for easy handling by
material handling equipment. This not only contributes to the effective
utilization of storage space, but also offers optimal stability for items
such as lumber, bagged products and cased goods. Load unitization
helps eliminate handling problems and maintain good vertical
alignment during rail, road or sea transportation, so product does not
get damaged.

Shrink Wrapping
• Shrink wrapping is a simple and inexpensive packaging process where
a flexible plastic film – when exposed to rising temperature – shrinks
and closely fits the items of the package it surrounds. It is mainly used
on case good shipments and isn’t used on a larger scale because of
the widespread popularity of stretch wrapping.

Stretch Wrapping
• Stretch wrapping is perhaps the most popular packaging technique,
which is used in a variety of industries to unitize pallet loads for
shipment. The process involves numerous wraps of stretch wrap
around a load of product to keep them closely together during
shipment, to help ensuring damage-free transportation. The stretch
wrap can be applied either by hand held stretch wrapping tools or
by stretch wrapper machines.

Strapping
• Strapping, or banding, is when a polythene, plastic or metal band is
used to hold products together as a unit. This method of unitization is
primarily used with high density and bulk products, such as coils,
lumber and ingots, but also commonly used with cased product.
Strapping can be applied by either hand strappers or strapping
machines.

Angle, Corner Boards & Edge Protectors
• By placing these angle, corner and edge protectors on the corners or
edges of palletized loads, commonly cases, they provide added
stacking strength and stability, protection from strapping used to
secure loads and edge protection by absorbing load impact at load
corners.

Father of Containerization
Malcolm McLean (November 14, 1913 – May 25, 2001) was an
American businessman. He was a transport entrepreneur who
developed the modern intermodal shipping container, which
revolutionized transport and international trade in the second half of
the twentieth century. Containerization led to a significant reduction in
the cost of freight transportation by eliminating the need for repeated
handling of individual pieces of cargo, and also improved reliability,
reduced cargo theft, and cut inventory costs by shortening transit time.

A history of shipping containers and
containerization
• With over 17 million shipping containers globally making a total of
around 200 million trips every year, we often don’t give a second
thought to the humble beginnings of this item; a necessity in today’s
World for the transportation of goods.
• However the impact that the development of the shipping container
had on the global markets was dramatic, changing the industry and
transportation of products drastically.
• The idea of shipping products in containers is a very old one. The
ancient Greeks used sealed vases to transport both liquid and dry
products, mostly wine. Later they used large trunks and wooden
chests to ship valuables, tea and spices from the Far East.

Shipping in the 1930’s
• Even as recent as the 1930’s the traditional approach to shipping was
to adopt break-bulk container handling, where goods were
transported loose or packaged in boxes, bags,barrels, or other
• Relatively small containers that varied depending on the type of good.
This method of transportation meant that large teams of port workers
were required in order to unload every shipment that arrived. Ships
would often spend as long in port as they would at sea.

The 1950’s and containerisation
• Everything then changed in the 1950’s when Malcom McLean, a trucking
entrepreneur from North Carolina, USA, realized that if transportation could be
integrated it would be much simpler, quicker and less expensive to have one
container that could be lifted from a vehicle directly on to a ship without first
having to unload its contents. Inspired by the US Military who had begun using
8'6"x6'3"x6"10" metal shipping containers during World War II McLean
developed the concept of using metal shipping containers for the commercial
market. Larger than the containers used by the military, yet still capable of being
transported by truck or train, in 1956 McLean shipped a vessel loaded with 58
metal shipping containers from Newark to Houston thus giving rise to the birth of
containerisation.
• The impact proved positive for businesses shipping goods as containerisation led
to decreased shipping costs due to economies of scale and lower staffing costs, as
well as better cargo security. Products were no longer visible to the casual viewer
so were less likely to be stolen, and with the doors of containers generally sealed,
tampering became a less likely occurrence.

Shipping containerisation in the 1960’s and 70’s
Throughout the 60’s and 70’s as containerization became the norm, ISO
specifications were introduced to ensure standardization of container sizes across the
shipping industry, which allowed for more aggressive investment in purpose built vessels
and container-handling equipment.New ports had to be developed as the larger vessels
required deeper water and containerised trade required more space. The lower shipping
costs associated with containerisation led to additional volume in trade and despite there
not being a need for warehouses at portside, space was required for the containers
themselves. Port operations were moved away from city centres such as London and New
York to less developed locations nearby such as Tilbury and Elizabeth respectively, where
there was the space available that was required.
https://www.youtube.com/watch?v=gAs01Xr1U8w&t=5s
https://www.youtube.com/watch?v=doUktZIcXF0 (1 hour )

What is a TEU?
• A TEU (twenty-foot equivalent unit) is a measure of volume in units of
twenty-foot long containers. For example, large container ships are
able to transport more than 18,000 TEU (a few can even carry more
than 21,000 TEU).
• One 20-foot container equals one TEU. Two TEUs equal one FEU.

Some other facts about containers ships:
• A large container ship engine has about 1,000 times more power than a family car.
• The gantry cranes that load and unload container ships can be 430 feet tall and weigh up
to 2,000 tons.
• Container ships are technologically advanced. A good example is the computer software
that enables precise planning for the loading and unloading of containers and keeps the
vessel balanced by increasing and decreasing ballast at the touch of a button.
• A recent study by Lloyd’s Register found that the fuel efficiency of container ships (4,500
TEU capacity) has improved 35% between 1985 and 2008.
• It is estimated that on average a container ship emits around 40 times less CO2 than a
large freight aircraft and over three times less than a heavy truck.
• Container shipping is estimated to be two and a half times more energy efficient than rail
and 7 times more so than road.
• Weekly safety and fire drill sessions take place for all crewmembers when the vessel is at
sea to make sure that they are practiced for any real emergencies.

Types of containers
1. Dry storage container
• The most commonly used shipping containers; they come in various
dimensions standardized by ISO. They are used for shipping of dry
materials and come in size of 20ft, 40 ft and 10ft.

Contd..
• Flat rack container
With collapsible sides, these are like simple storage shipping
containers where the sides can be folded so as to make a flat rack for
shipping of wide variety of goods.

Contd..
Open top container
With a convertible top that can be completely removed to make an
open top so that materials of any height can be shipped easily.

Contd..
•Tunnel container
•Container storage units provided with doors on both ends of the
container, they are extremely helpful in quick loading and unloading of
materials.

Contd..
• 5. Open side storage container
• These storage units are provided with doors that can change into
completely open sides providing a much wider room for loading of
materials.

Contd..
6. Double doors container
They are kind of storage units that are provided with double doors,
making a wider room for loading and unloading of materials.
Construction materials include steel, iron etc in standardized sizes of
20ft and 40ft.

Contd..
•7. Refrigerated ISO containers
•These are temperature regulated shipping containers that always have
a carefully controlled low temperature. They are exclusively used for
shipment of perishable substances like fruits and vegetables over long
distances.

Contd..
8 Insulated or thermal containers
•These are the shipping storage containers that come with a regulated
temperature control allowing them to maintain a higher temperature.
The choice of material is so done to allow them long life without being
damaged by constant exposure to high temperature. They are most
suitable for long distance transportation of products.

Contd..
•9. Tanks
Container storage units used mostly for transportation of liquid
materials, they are used by a huge proportion of entire shipping
industry. They are mostly made of strong steel or other anti corrosive
materials providing them with long life and protection to the materials.

Contd..
• 10. Cargo storage roll container
• A foldable container, this is one of the specialized container units
made for purpose of transporting sets or stacks of materials. They are
made of thick and strong wire mesh along with rollers that allows
their easy movement. Availability in a range of colored wire meshes
make these shipping container units a little more cheerful.

Contd..
• 11. Half height containers
• Another kind of shipping containers includes half height containers.
Made mostly of steel, these containers are half the height of full sized
containers. Used especially for good like coal, stones etc which need
easy loading and unloading.

Contd..
•12. Car carriers
Car carriers are container storage units made especially for shipment of
cars over long distances. They come with collapsible sides that help a
car fit snugly inside the containers without the risk of being damaged
or moving from the spot.

CAB Unit 1 -Dr.Harris kumar

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