CHAPTER 7:

CONTAINERIZ
ATION
CONTAINERIZATION AND LEASING PRACTICES
After studying this chapter, you will be able to understand :

the different types

the concept of of containers
containerization

the history of the benefits of

containerization containerization
container leasing inland consumer
practices depots
 HISTORY OF CONTAINERIZATION
Logistics experts had been trying Malcom McLean, often called
for a very long time to devise a the father of containerization,
unit load of cargo. A variety of
methods to devise unit loads were
first conceived the idea of
tried which would improve the using the entire truck trailer to
efficiency of transport operation load onto and off the ship.

In 1956, McLean adopted a ship

for carrying containers. His first
attempts to directly transfer
containerization cargo from
trucks to ships were successful.

McLean later established a By 1961, regular container

very successful multi services were in operation
modal transportation between New York, Los
company called Sea Land Angeles and San
Inc. Francisco.
 TYPES OF CONTAINERIZATION
Open top containers Flat rack containers
• Suitable for cargo with extra height, which • These containers are suitable for heavy loads
can be loaded from the top with crane and extra wide cargo
• The top can be covered with tarpaulin if • The bottom has strong construction
required • Fixed end walls allow bracing, lashing and
• stacking.
Suitable forklift pockets, lashing devices
and corner posts are provided

Refrigerated containers
Platform containers
• Suitable for cargo that constantly needs temperature
above and below freezing point.
• Platforms are most suitable for heavy loads and
• It is possible to get fresh air supply within the
oversized cargo.
containers in the quantity required to keep the product
• The bottom has strong construction
inside safe.
• The insulating material, polyurethane foam is
sandwiched between two walls of the container.
• The temperatures can be set between + 25 degree C and
-25 degree C.
 OTHER TYPES OF
CONTAINERS
Half height containers
Side door containers

• These are quite similar to open top containers • These containers have side doors.
but are only half the height. • They are particularly suited for cargo which
• They are mainly used for extremely heavy and fits the inner dimensions of the container, but
dense cargo such as steel beams or coils of still is too wide to fit through the end door.
tinplate.

Ventilated containers
Bulk containers
• These containers are suitable for cargo that needs • Ideally suitable for the carriage of dry bulk
ventilation such as coffee or cocoa. cargo.
• They have small openings at each corner that let fresh • Three equivalent manholes are provided for top
air into/out of the container, but block the entry of rain loading.
and seawater. • Forklift pockets and lashing devices are
provided.
 Insulated containers Collapsible containers

• These are like normal box containers, but the

• These are normal box containers with insulating
box can be collapsed completely.
material in the walls, top and bottom. • These containers are used on routes where
• As a result, there is minimum temperature
there is very little return cargo and containers
fluctuation inside.
routinely return empty.

Tank containers

• These containers are suitable for chemical products

such as inflammables, oxidizing agents, toxic
substances and corrosives.
• These are also suitable for food products such as
alcohols, fruit juices, edible oils and food additives.
CONCEPT OF CONTAINERIZATION

: is a shipping system based Characteristics of a fright

container are:
on large (up to 48 feet
long) cargo carrying
containers that can be • Strong enough for repeated
easily interchanged use.
• Specifically designed to
between trucks, trains and facilitate the carriage of goods
ships without rehandling by one or more modes of
the contents. transport without intermediate
reloading.
• Fitted with device permitting
Containerization its ready handling, particularly
in transferring from one
transport to another.
• Designed for easy filling and
emptying
• Has an internal volume of at
A container is a single , least 1m3 or more.
rigidly sealed, reusable
metal box in which
merchandise is shipped by a
vessel, truck or rail.
BENEFITS OF CONTAINERIZATION
CONTAINER LEASING PRACTICES
4. Sometimes the trade volumes in the world
markets are very low. During such times, the
1. Containers are largely owned by containers remain idle in different parts of the
shipping lines and by some of the world. During other periods, there is an
leading freight forwarding organizations
upsurge in the shipping volumes and a
around the world. corresponding shortage of containers.

2. Additionally, some companies

owning containers lease them out to
shipowners , forwarders or sometimes 5. Containers being expensive,
even directly to shippers for certain the shipping lines do not own
time periods. many of them.

6. In case of need, shipping lines

3. The practice of leasing containers is would lease from leasing
important because there is a constant companies to meet the temporary
fluctuation in the shipping business demand.
 TYPES OF LEASES

ONE WAY LEASE MASTER LEASE

TYPE OF
LEASES

ROUND TRIP LONG LEASE

LEASE SHORT LEASE
 ADVANTAGES OF LEASING
The following are
the advantages of
leasing:

1 3

It is possible to lease a container at a short

Leasing saves shipping lines from blocking
notice in case of a sudden surge in demand
Containers can be returned their capital. Most shipping lines have a
for containers.
to the leasing company as policy regarding the percentage of
soon as the demand of the containers owned against percentage
shipping lone is over. leased.
 ADVANTAGES OF LEASING
The following are
the advantages of
leasing:

4 6

The newly formed shipping lines can

start off with leased containers , without The entire business of NVOCC is
At many places, the leasing built on leased equipment.
investing their capital in the ownership companies waive off drop off
of containers. and pick up charges when there
is a slump in the demand for
containers.
 INLAND CONTAINER DEPOTS
An inland port is a site located
away from traditional land, air and Functions of inland container depots are :
coastal borders. • Provide transportation logistics
services for export import as well as
domestic cargo in containers.
• Facilitate trade to and from the
industries based in the hinterland ( that
is areas separated from the seaports
and international airports).
• Reduce the bottlenecks at seaports by
freeing up storage space in container
yards.
It facilitates and processes • Create employment opportunities and
international trade through development in rural areas.
strategic investments in multi
modal transportation assets and by
promoting value added services as
goods move through the supply
chain.
 DUTIES AND RESPONSIBILITIES OF AN ICD

GATE IN CHECK GATE OUT CHECK DOCUMENTATION REPORTING

o All containers o All containers are o An Equipment o All the movements

entering the ICDs checked for their Interchange Receipt of containers in and
are checked for condition on their (EIR) is issued every out of an ICD is
damage or way out of the time equipment is notified to the owner
contamination. of the containers.
ICDs. interchanged
o Empty containers o The communication
between two parties.
are examined both is carried out
o Damaged empty o The EIR contains
internally as well through e-mail, fax
as externally. containers are not details such as the and where ever it is
o Damages are sent for stuffing. names of the parties available through
reported to the In such a case, involved, container EDI.
container owner, the owner is number, seal number
so that repairs can informed and (for stuffed
be carried out his/her containers), name of
either at the ICD instructions are the transporter,
or any other repair sought. vehicle number and
facility of the
so on.
owner’s choice
 DUTIES AND RESPONSIBILITIES OF AN ICD
MISCELLANEOUS
REPAIRS AND
STORAGE DESPATCH DUTIES AND
MAINTENANCE
RESPONSIBILITIES

o Any repair work o ICDs have to o ICDs arrange for road

undertaken at an o These include
make suitable and rail transportation
ICD must arrangements for of the cargo to the sealing the
conform to the safe storage of ports. containers,
customs approval
containers. o They also undertake lashing, securing
standards. o Empty containers and bracing odd
o The International stuffing and de
are stacked one stuffing operations, if size cargo, and
Institute of conducting
Container on top of the required.
other. container
Leasers (IICL),
o ICDs must have conditioning
which is based in
the US, has suitable material surveys
developed these handling
standards, which equipment for
are best known moving the
standards in the containers within
industry.
the premises.