Rail freight transport VS Sea freight transport | full review

Parisa Amiri Parisa Amiri November 7, 2020 0 Comments
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The need to move goods from one place to another one has created “transportation.” During history, human beings have experienced historical, commercial, cultural, and social movements. Today, transportation is one of the most critical sectors of the national economy, which has a significant impact on the country’s economic growth process due to its infrastructure role. 

The connection of transportation with all socio-economic sectors has made this activity one of the main pillars of the economy, trade, and social life. There are different means of goods transportation from one country to another, such as sea freight, air freight, rail freight, and road freight. Many people like to know the difference between Rail freight transport VS Sea freight transport, Air freight transport VS Sea freight transport or Rail freight transport VS Air freight transport.

These methods of goods transportation have created significant changes in global business development in recent decades. This article aims to talk about “Rail freight transport VS Sea freight transport,” after finishing this article, you will have comprehensive information in this field. 

Rail freight transport VS Sea freight transport 

When it comes to talking about “Rail freight transport VS Sea freight transport,” it is better to mention each way’s features. Then, a reader, with an open view, can understand the difference and similarities of them. 

Sea freight in Rail freight transport VS Sea freight transport

It is better to know that in Rail freight transport VS Sea freight transport, sea shipping has been one of the primary means of transporting goods for many years. This method of transportation still has an essential role in the transportation of various goods. Because ships can carry a wide range of goods with different weights and sizes, they do not have any restrictions on the carriage of goods compared to planes and trucks. Therefore, it has some rules that you, as s businessman and businesswoman, should know them. A contract of carriage by sea is a contract concluded between the parties. Under the contract of carriage by sea, one party undertakes to move the goods mentioned in the agreement from one country to another. The sea contract is usually set in several copies, and these copies are distributed among the parties. Both parties must keep the agreement up to the end of the transportation by the sea. 

What are the reasons for concluding a shipping contract in Rail freight transport VS Sea freight transport?

In Rail freight transport VS Sea freight transport, it is crucial to know about contracts’ rules. As international regulations state, a shipping contract is a critical process in sea freight. Goods may break or damage while moving. Also, some goods have a time of consumption, and if they stay on the ship for a long time, they will spoil. There is also the possibility of missing and stealing goods. In some cases, the goods may be shipped to another port incorrectly or arrive much later than the recipient wants. 

All of these are reasons that lead the parties to the contract to ensure the goods’ safety during shipping. These documents can guarantee any party’s possible to refer to litigation authorities in case of these problems. The use of these contracts will provide security for the parties during the transfer of goods. All this information is necessary for Rail freight transport VS Sea freight transport.

Types of shipping contracts in Rail freight transport VS Sea freight transport

There are different contracts in sea freight, and if you want to have exact look at Rail freight transport VS Sea freight transport, you should know them. They are as the following:

  • Ship rental contracts: One of the essential types of shipping contracts is the “ship rental contract.” It is a contract under which the company or the shipowner agrees with the other party to use the ship for cargo. The term of this contract is limited. In conventional ship rental contracts, the crew and all the equipment inside the ship are given to the person or company renting it, and he/she must return everything to the owner safely after the end of the contract. If the landlord does not need a crew, this should be stated in the agreement. Information such as the name of the ship, its specifications, and capacity, specifications of cargo and its quantity, ports, and places of loading and unloading, rental rates and payment methods, the time allowed for loading and unloading are mentioned in these contracts. These contracts are based on the specified time. This means that the ship may be rented for one or more trips or for a certain period.
  • Bill of Lading: In a bill of lading, the ownership of goods on the sea is specified. Shipping companies conclude various bills of lading with the company, and they determine the conditions of the goods during the ocean. Some features such as the carrier, the goods transported, the weight or volume of the shipment, the payment terms, the special handling instructions, the transport class of each package, and the rate and amount of the cargo are among the information contained in the bill of lading. There have been some international regulations for sea freight since the 19th century, and gradually, the terms and conditions of the bill of lading have been determined. It is usually stated in different laws that the bill of lading must be set in 3 copies. In this paper, the seller is obliged to deliver the carrier’s goods in proper conditions and packaging. The carrier on the ship is obliged to have this bill of lading with him. In case of deduction of delivery or additional unloading or delay in delivering goods, the carrier is responsible. The carrier must also observe the following conditions before starting the transportation of goods: Preparing the ship for cargo operations, Accurate calculation of sufficient fuel supply, Preparing warehouses, cold storages, and other cargo storage areas, Preparing a plan for loading and unloading goods and transporting and unloading them. In many ports, a bill of lading is required to unload cargo. In international transport, the state customs are allowed to seize goods imported without a bill of lading in its favor.
  • Contracts with exceptional cases: In some cases, it is impossible to carry the desired cargo in the conventional shipping contract’s terms and conditions. For example, ordinary agreements cannot be used if the parties intend to lease the ship under certain conditions, such as increasing cargo or carrying dangerous goods such as chemicals or corrosives that require special permits. For these cases, outstanding contracts must be concluded in which these provisions are mentioned. For composite and multilateral agreements, such an agreement must be concluded between the parties.
  • Insurance: One of the most critical factors in ensuring the health of goods during the trip is insurance. Any goods that are legally transported must be insured. Usually, before the ship starts moving, the insurance contract is set by the owner of the goods, and in return, an amount is paid to the insurance company. In case of a threat to the health of the goods by any unintentional risk and proofed, the insurance company will pay according to the insurance contract’s provisions.

It is better to mention that in Rail freight transport VS Sea freight transport, the insurance also belongs to the rail transport. The insurance is one important factor in international transportation.

F.C.L. and L.C.L

When it comes to sea freight, it is essential to choose F.C.L. and L.C.L. then in Rail freight transport VS Sea freight transport, it is necessary to know these ways very well.

What is F.C.L.?

F.C.L. or full container load is a way to shipping packages by the ocean. The cargo of any size occupies a full container. 

 When is F.C.L. used?

This method can be used when the volume of our goods is the size of a container because, in this method, the cost of one square meter of cargo volume is less than the L.C.L. method, and it is suitable for goods that occupy the entire container.

What type of import is suitable for F.C.L. transportation?

  • Suitable for investors
  • Suitable for high volume goods (more than 20 cubic meters)

Difference between L.C.L. and F.C.L., Why is F.C.L. cheaper?

Because instead of paying for each C.B.M. (cubic meter), you pay for each container. The whole cargo belongs to a customer, and it has a customs license. The review is for one case only.

 Why is F.C.L. more secure?

Because only the customer and the supplier of goods have access to this load, the container does not move at all.

 Why is damage less likely in the F.C.L.?

Because the goods are not transported from inside the container, all contents inside the container belong to one buyer, and no other containers can be moved. This lack of displacement causes no damage to the goods.

What is L.C.L.?

L.C.L. or less than container load is the best when the packages are not occupied all the containers, and there are not many packages. It can be said that goods with a volume of less than one container, which belong to different buyers, are jointly placed in one container next to each other.

What type of import is suitable for L.C.L. transportation?

  • Suitable for start-up
  • For beginners
  • Carry sample load
  • Partial import

 How does the L.C.L. process work?

  • First, you will be contacted by the supplier of your goods in the country you are considering.
  • Necessary coordination is done.
  • After your goods are packed and ready, they will be sent to the port of origin.
  • The carrier ship is selected according to the desired conditions.
  • Send goods documents to the carrier company
  • Guide the container from the ship to the dock
  • Loading goods at the dock
  • Navigate to the destination port

L.C.L. and F.C.L. difference: Shipping cost in L.C.L.

To calculate the cost of transporting goods in this method, the most critical issue is to calculate the volume occupied by the goods. In this transport, C.B.M. is the unit of volume of goods (Per square meter = one C.B.M.).

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Note: If your product has a low volume and high weight, the calculation method will be different.

Some differences between L.C.L. and F.C.L.

  • Calculate the weight of goods in L.C.L.: each C.B.M. is one cubic meter.
  • Calculate the weight of the goods in the F.C.L.: Calculated based on each container.
  • In the L.C.L. method, upon clearance, your goods are taken out of the shared container, and the packages are opened and sent to you in cartons.
  • In the F.C.L. method, your packages will not be opened and will be delivered to you precisely as they were originally packaged.
  • In L.C.L., your goods are placed in a truck to be delivered to you. At this time, you can use the elevator to put your goods on the ground.
  • In F.C.L., goods are placed in a container and placed in the back of the truck. If your cargo is packed as a pallet when you pack, you can move it with a lift.
  • Affordable for small L.C.L. shipments.
  • Cost-effective for large FCL shipments.
  • At F.C.L., in addition to the product’s cost, you also have to pay for the container. But this is not the case in L.C.L.
  • Generally, in L.C.L., you only pay for the space occupied in the container, but in F.C.L., you have to pay for a container’s total capacity.

How is rail transportation done?

In the discussion of Rail freight transport VS Sea freight transport, you should first know how rail transport is done! Transportation by rail is under certain conditions. Unique freight cars are used to move goods, each of which has a unique function. There are different types of freight wagons in terms of appearance that they are mentioned in the following.

  • Flat wagons: Flat wagons are used in various types of rail transport. These wagons are used to carry heavy machinery and goods that are long. Goods such as iron parts and beams are transported by two-axle, four-axis, or six-axis flat wagons.
  • Wagons with roofs: These wagons are designed so that after placing the goods, the door is closed and sealed. This will keep the goods away from any damage. Some goods that are not resistant to sunlight, oxygen, and moisture are moved through these wagons. Usually, these wagons are made in two forms, two-axle and four-axle.
  • Short-edged and long-edged wagons: These wagons are used in various types of rail transportation. Short-edged wagons are used to transport hardware and building materials, and long-edged wagons are used to transport minerals and industrial goods. These wagons are capable of carrying heavy loads, and, in many cases, they take several tons of load.
  • Tank wagons: Another wagon used in the rail transport industry is tank wagons. These wagons, like other wagons, are made in two types, two-axle and four-axle. These wagons are used to transport fuel and various liquids. Many traders faced many difficulties in transporting such goods, and f tank wagons have eased their concerns about transporting liquid goods. These goods will reach their destination in the shortest possible time.
  • Refrigerated wagons: Other wagons used in various types of rail transportation (and it is essential to know them in Rail freight transport VS Sea freight transport) are refrigerated wagons used to transport a variety of perishable materials such as dairy, meat, and vegetables. These wagons have a professional cooling system, and the refrigerator temperature is adjusted automatically during the trip.

Rail transport rules and regulations (in Rail freight transport VS Sea freight transport)

In Rail freight transport VS Sea freight transport, it is better to know that many countries have signed international conventions on various types of rail transport, each of which addresses a specific issue.

These conventions include:

  • The International Convention on the Carriage of Passengers and Luggage by Rail (217) 1916, 
  • The Comprehensive Convention on International Carriage by Rail (COTIF) 1980,
  • The International Convention on the Carriage of Goods by Rail (C.I.M.) 1961, 
  • The Convention International Transport by Rail (FITOC), 
  • Amending Protocol to the Comprehensive International Transport Convention by Rail 1990 
  • The Amending Protocol to the International Transport Convention (F.T.C.). 

These conventions are designed for international rail transport so that the member states can enjoy all the global facilities and capacities! It is very important in Rail freight transport VS Sea freight transport.

Advantages of rail transportation, in Rail freight transport VS Sea freight transport 

When it comes to Rail freight transport VS Sea freight transport, it is a significant issue to point to each way’s advantages. Rail transport has unique benefits, the most important of them are mentioned below:

  • Less environmental impact: One of the essential benefits of rail transportation is the possibility of using non-fossil fuels. This saves fuel. Energy consumption on trains is about one-sixth less than other ways ( it is a vital factor in Rail freight transport VS Sea freight transport). 
  • Less pollution: Noise pollution is one of the biggest problems in society, and many other transportation types have caused environmental pollution. Rail transportation does not involve noise pollution because it occurs in the suburbs and even outside the city.
  • Reduction of stop time: One of the essential advantages of rail transportation is the stop time reduction. Trains can run the routes entirely without stopping. This allows the goods to reach their destination as quickly as possible (but they are not very fast)

What documents are required to transport goods by rail transport?

One of the critical factors in Rail freight transport VS Sea freight transport is to be familiar with the documents needed in each way. All relevant documents must be prepared to transfer goods through rail freight companies, and all required forms must be completed. In addition to the country’s laws in which goods are transported, many transportation companies add several personal rules to the contract that must be signed. Otherwise, the company will not send your goods to the destination. In general, relevant contracts include these factors:

  • Name
  • Product details
  • Sender and recipient address
  • Insurance

These contracts specify all the amounts and conditions of shipment, and if the transport company does not comply with one of them, it will be obliged to compensate for the damages.

After the above contract is settled, a bill of lading will be exchanged between the parties. This form is a document, and in case of loss, the transport company will not take any responsibility for your goods. In some cases, the shipping company has not paid any damages despite damaging the customer’s goods. Because the bill of lading has been lost by the customer and the company has taken full advantage of this opportunity to acquit itself!

Disadvantages of rail transportation

The disadvantages of rail transportation (in Rail freight transport VS Sea freight transport) are as the following:

  • Using this method, it is impossible to provide services to deprived countries (due to lack of services).
  • Mechanical problems may cause service problems.
  • Rail transport is not very fast (it is one crucial matter that must be taken into consideration in Rail freight transport VS Air freight transport)
  • It is possible to damage the product.

Rail freight transport VS Sea freight transport, which way is cheaper?

One of the most frequent questions in Rail freight transport VS Sea freight transport is the cheaper way. As you know, sea freight is the most inexpensive way compared to other ways of transportation. But it depends on the weight and size of the goods to choose the most affordable way.

Concluding Remarks 

This article tried to point to different aspects of Rail freight transport VS Sea freight transport. Many issues are considered important in Rail freight transport VS Sea freight transport. At first you should have a comprehensive look at both ways. It makes these two ways clearer for you. If you want to choose Rail freight transport VS Sea freight transport, it is better to consult professional freight forwarders.

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In Rail freight transport VS Sea freight transport, which one is better?

It depends one the weight of the loads. For goods that they are heavy or they have bad shape, the sea freight is one of the best way among all transportation methods.

Parisa Amiri
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