Transshipment is a critical component of the logistics process when no direct shipping route exists between an export and import location. In this article, we will discover the meaning of transshipment, its role in global trade, and the significance of transshipment hubs in handling international container cargo.
What is a transshipment?
Transshipment refers to transferring cargo or containers from one vessel to another during transit to their final Port of Destination (POD).
A typical transshipment process involves goods leaving the Port of Loading (POL) on Vessel A and arriving at a transshipment port. There, the cargo is offloaded and reloaded onto Vessel B, which takes it to the Port of Destination (POD). While this process sounds simple, complex cases may involve multiple transfers at various transshipment hubs before delivery.
Transshipment example
Imagine a shipment of batteries manufactured in Ningbo, China, destined for a retailer in Casablanca, Morocco. Since there’s no direct shipping route between these two locations, it needs tran shipping.
The container departs from the Port of Ningbo and travels to a key transshipment hub like Singapore. Upon arrival at this transshipment port, the cargo is unloaded and temporarily stored. Then, the cargo will move to Vessel B, which passes through the Suez Canal and delivers the shipment to the Port of Casablanca.
In this scenario, Singapore is the transshipment hub, connecting the point of origin with the final destination. Later in the blog, we’ll explore other major transshipment ports and their vital roles in global trade. But first, let’s take a closer look at why transshipment is essential in international shipping.
Why should you consider transshipment?
According to the UNCTAD, over 80% of global trade volume is carried by sea, with over 5,500 cargo ships moving over 34 million containers annually. Many of these vessels lack the capability for direct end-to-end shipments, which is the key reason for transshipment.
Here are other reasons to consider transshipment:
Cost reduction
Larger shipments can be broken down into smaller containers, or smaller shipments can be combined into larger vessels, taking advantage of economies of scale. It is useful when the final port cannot accommodate larger ships.
International politics
Sometimes, transshipment enables bypassing trade restrictions or bans between countries. It can provide an alternative route for goods and allow goods to reach their final destination indirectly through a third country.
Transshipment supports cargo switching from one form of transportation to another, such as changing sea freight to road or rail. It can enhance logistics efficiency.
What are the top 5 busiest transshipment ports?
A transshipment hub is an intermediate port where goods are unloaded and transferred to another vessel. Below are five of the busiest international container transshipment terminals:
1. Port of Singapore
The Port of Singapore connects to over 500 ports in 123 countries, making it a global logistics powerhouse. With around 130,000 vessel calls each year, it handles about 20% of the world’s shipping containers.
2. Port of Shenzhen
The Port of Shenzhen, located in southern China, is a network of key ports, including Yantian, Chiwan, Dachan Bay, and Shekou.
3. Port of Shanghai
As the busiest port in the world, Shanghai Port is also a leading transshipment hub. From January to August, it recorded a 3.6% year-on-year growth in container volumes, totaling 32.14 million TEUs.
4. Port of Hong Kong
In the 1990s, the Port of Hong Kong dominated southern China’s shipping activities. It remains a key player with extensive ship maintenance, repair, and dry-docking facilities.
5. Port of Busan
The Port of Busan in South Korea thrives as a transshipment hub due to its extensive feeder vessel network. It connects to ports in Russia, China, and Japan, attracting significant cargo volumes.
How does transshipment differ from direct shipment?
The key distinction between direct shipment and transshipment lies in cargo handling during transit. Direct shipment involves transporting goods from the origin to the destination without unloading or reloading. In contrast, transshipment requires transferring cargo at an intermediate port, often involving additional steps like unloading, storage, and reloading onto another vessel.
While transshipment is typically more cost-effective than direct shipment, it often takes longer due to the additional handling and potential delays at transshipment hubs.
At ASLG, we take a customer-first approach when organizing transshipments. Our focus is on meeting every shipping requirement to ensure your cargo reaches its final destination safely and on time, no matter the complexities involved.
What is the difference between transshipment and trans-loading?
If you’re in the shipping industry, you’ve likely encountered the term transloading. While it may sound similar to transshipment, the two processes serve different purposes.
- Transshipment involves transferring cargo from one ocean vessel to another while the goods remain in the same container.
- Transloading, however, involves transferring goods between different types of containers or transportation modes. For instance, cargo might move from an ocean container to a truck or railcar for further delivery.
How can you track a transshipment?
Transshipments play a vital role in global shipping but can introduce challenges like delays. These disruptions may result from late vessel arrivals, port congestion, or issues at the departure point. Such delays can impact asset turnover and customer satisfaction, potentially harming your business.
Tracking transshipments ensures timely updates to customers and helps mitigate concerns. To monitor your shipment:
- Use the carrier’s website by entering the Bill of Lading (BoL) number for real-time updates.
- Partner with logistics experts who provide proactive tracking and status updates.
At Airsupply, we offer tailored solutions for international shipping, whether door-to-door delivery or FBA forwarding. Our seamless operations and competitive pricing keep your supply chain efficient and reliable.
