The Role of Seaport Terminals in Maritime Transportation - Assignment Example

The Role of Seaport Terminals in Maritime Transportation Introduction To picture a seaport and the ocean in a movie would produce a body of water with thousands of lights, and these lights are the ocean-sailing, intermodal vehicles. The seaports are there to receive those vehicles all day- and all night-long. This illustrative scene is not only in the movies, but it is a reality. A seaport in a city harbour at night can provide us a colourful evening with thousands of lights. Ports form part of the global economic system and therefore their role in maritime transportation and in world trade cannot be undermined. Port terminals have the primary objective of providing a transhipment point to goods in voluminous cargoes worldwide. Port terminals are where goods are brought, loaded and unloaded and distributed to wherever they have to be sent. Seaport terminals provide service to container vessels and other sea vessels like barges and feeder vessels used in commercial fishing. Seaports serve international and global firms and have a role to play in international trade as a big bulk of world trade is transported by ship (Frankel, 1987 cited in Stevens, 1999, p. 43). Globalization has affected many world developments such as regional integration of countries like the European Union, the implementation of the North American Free Trade Agreement (NAFTA), the establishment of the World Trade Organization, and the homogenization of the world economy, to name a few. All these provide expansion for global firms. They expand business, and they need seaport terminals because they demand movements of goods. Global firms have the whole world as its market field that they can offer a wide array of products and services. Firms keep growing and continue to build products that have to be transported and marketed anywhere and anytime. Seaborne transportation is the cheapest means of transportation for goods that have to be transported to many parts of the world. This keeps seaports busy all throughout the year. With these facts, it can be understood that seaports have a very important role in the supply chain of businesses worldwide. This can be to fulfil business-to-business or business-to-consumer transactions. With globalization at the helm of businesses today, seaports are connecting a worldwide traffic of goods of different kinds. Supply chain management excellence is crucial for customer satisfaction, at the same time customer satisfaction is critical to customer loyalty, with loyalty being critical for profitability (Reichheld 1996 cited in Flint et al., 2008, p. 258). Supply chain has to be continuously monitored, especially with business-to-business and business-to-customers transactions. International shipping may not be concerned with the so-called customer satisfaction but global firms depend on them in answering the needs of their customers. Supply chain is different from supply chain management. Port terminals are a part of the global supply chain. The different companies in these port terminals have to manage their own supply chain in order to effectively deliver their goods and cargoes to customers. The purpose of this essay is to discuss the various roles and uses of seaports in maritime transportation. Definitions Before going any further, it is imperative in this paper to define first the important words that we will be dealing with as we go on with the discussion. Maritime transportation involves seaborne transportation such as boats and intermodal transportation. Maritime transportation cannot function without seaport terminals. It is here where sea vehicles bring and unload their cargo and also where trucks, trains, and other land vehicles get the cargo unloaded from ships and bring them to different destinations. A port is a part of a transportation network. It is located on the shorelines of a city or country and it is here where terminal services can be acquired and provided by sea ships, trains and trucking firms. The services include the transport of cargo and passengers. Barges are used for inland transport of goods while feeder vessels are used instead of large vessels in accessing to hub ports. The hubs are those which receive high volume of transported goods. (Meisel, 2009, p. 8) TEU (Twenty-foot Equivalent Unit) is the unit of measurement for measuring the weight of container cargo. Containers have a measurement of twenty square feet. (Stevens, 1999, p. 44) Discussion The maritime industry has been very much affected by globalization. Maritime transport worldwide is a major determinant of world trade. Eighty percent of products traded worldwide are transported by seas. (UNCTAD, 2008) This is remarkable considering that air transportation has been very much improved and considered the fastest means. But transporting goods by sea is cost effective, and the fact that ships can carry heavier loads. Ports are where different kinds of products go; they are the loading areas of ships. These products are categorized as dry and wet: dry for coal, ores, grain products, and even cars, equipments, etc; and wet for oil, minerals, and also chemicals and other liquid products. Non-bulk products are usually carried in containers. (Stevens, 1999, p. 44) Containerization has revolutionized the handling of cargoes in port terminals. Before the adaption of containers, cargoes were just placed in boxes or crates. This was very ineffective in the handling of voluminous cargoes. But now, containers have simplified packaging and shipment of cargoes. Containerization provides easy handling and processing of goods. Port authorities have recognized the importance of containers and so they provide a big space for these. Cranes, super-structures and other equipments used in loading and unloading of containers have to be provided for this purpose. Seaborne trade has impacted on the overall world trade that involves transport of goods which in 2007 alone amounted to 8.02 billion tons of different goods. Every year this big volume increases to several percentages. Most of the bulk of this cargo is in containerized ship. (UNCTAD, 2005, p. 8) Emerging economies, such as those in Asia, have contributed to the increase of shipment of cargoes in ports. These emerging economies depend much on commodities shipment, fuel, and the employment generated out of it. Seaborne trade account for a big percentage of the economy generated by these emerging economies in Asia and other Third World countries. India and China are emerging economies which need oil and various commodities. Suppliers come from Africa and Latin America, and in turn China supplies consumer goods to Africa and Latin America. This exchange of goods requires the services of ships and container terminals in the loading and unloading of manufactured goods of various types, dry and wet goods, including cars, electronic gadgets, etc. Car cargo alone needs large ships with a maximum cargo volume that can accommodate hundreds of cars. The ships have to transport these cargoes in short distances and at low cost. These ships have to return back to their point of origins. The process is similar to vehicle routing in the case of land transportation. The owners of these ships have to make the routing cost to the minimum in order to satisfy the customers. (Kreowski, 2011, p. 482) From these perspectives, comes competition among the different ports worldwide. Shipping companies have learned how to concentrate their efforts on a limited number of ports of call, or at least, they have to limit the number of ports of call. Feeders have to do the job for large ships. Shipping companies have benefitted from the economies of scale because of the services offered by their large ships. Some shipping companies have merged so that the demand for port services has also become concentrated. (Huybrechts, 2002, p. 1) Port terminals have to answer the new demands of supply chain from global organizations and businesses. Ports have to apply and engage new logistical processes due to the emerging globalization. In some parts in Asia, new port-cities are emerging because of the volume of the increasing volume of trade. Other port cities also have to expand and revitalize their roles and functions in these ever-increasing functions of port terminals. (Wang et al., 2007, p. 1) Conclusion Commercial shipping seems like a human body. The shipping lanes act like arteries where blood freely flows and the ships are the blood and the carrier of different cargo or the nutrients of the body. Seaports have a very important function in this human body because they act as the organs of the body. Increasing activities in seaports have brought issues of management and competition among shipping companies. Seaport terminals have a significant role in world commerce and trade. Vast goods loaded in containers are shipped to many areas of the world. Maritime transports need these seaport terminals in loading and unloading of goods. Supply chain is enhanced by international shipping. Supply chain involves transfer of goods from supplier to business organization and onto the customer. It may also involve from supplier to customer. Supply chain is very important in business as failure to effectively deliver goods and services on time can hamper business success. In international shipping, seaport terminals serve as the backbone for supply chain with ships supporting the delivery of goods. This has to be managed effectively in to continuously deliver the necessary goods direct to buyers and customers. References Flint, D., Larsson, E., and Gammelgaard, B., 2008. Exploring processes for customer value insights, supply chain learning and innovation: an international study. Journal of Business Logistics, Vol. 29, No. 1 [e-journal], Available through: Staffordshire University Library [Accessed 25 Mar 2011]. Huybrechts, M., 2002. Port competitiveness: an economic and legal analysis of the factors determining the competitiveness of seaports. Antwerp: Editions De Boeck Ltd. Kreowski, H., 2011. Dynamics in logistics. London; New York: Springer. Meisel, F., 2009. Seaside operations planning in container terminals. London; New York: Springer. Stevens, H., 1999. The institutional position of seaports: an international comparison. United States of America: Kluwer Academic Publishers. Wang, J. et al., 2007. Ports, cities, and global supply chains. 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