Liner trade in maritime business
By Foluke Akinmoladun
In the engagement of vessels for the carriage of cargo, be it dry bulk cargo, liquid bulk cargo, manufactured or semi-manufactured goods, the vessel engaged maybe either one on a schedule of ports of loading and ports of discharge or may be one that is engaged on an individual basis based on the market. In this question, these different vessel carriage arrangements will be discussed. This will involve looking briefly into the advantages and disadvantages of the different vessel carriage arrangement in describing their operations, examples of their operations and the best-suited cargo for such vessel arrangement.
Some ships in carrying her cargo, run a regular published timetable similar to a scheduled airline or railway. Potential customers wanting to ship cargo can easily find out when a ship is sailing to the port of discharge or disembarking from the port of loading. These vessels adhere to a published timetable, with clearly stated dates of call on set conditions of carriage. This type of vessel arrangement is referred to as liner vessels and the trade they engage in is referred to as liner trade. The cargos carried by liners are referred to as liner cargo.
Liner operation involves an adequately sized fleet and a fairly large shore establishment. Today the modern liner cargo service is multi-modal and is sophisticated in terms of its logistics and computerized operations. Liner companies are continuously striving to improve efficiency and reduce overall transit times to stimulate trade development and improvement in market share. The liner company therefore tends to be a large concern and in more recent years it operates its container tonnage on a consortia basis.
Liner cargos are usually made up of manufactured or partly manufactured goods. The vast majority of almost 90% of liner cargo are carried in containers. Liner shipping however do not only relate to containers, but also to other types of cargoes which have a regular and fixed routing/service like RoRo services, Bulk cargo services on a Contract of Affreightment or long-term charter.
Liner shipping at times incorporates, 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.
Liner services offer cargo space to all shippers who require them. They sail on scheduled dates, irrespective of whether they are full or not. The vessels in a liner service generally fulfils the schedule unless in cases where a call at one of the ports has been unduly delayed due to natural or man-mad causes. Hence in liner operations, the regular scheduled service is the basis of a particular division/ cargo type or specialisation. It is vitally important to the ship-owner that everything is done to ensure punctual sailing and arrival dates, otherwise the company’s reputation and prestige quickly declines and this can adversely affect the profitability and the solvency of the shipping company in the long term.
An example of a liner shipping service is: The UK/NWC continent container service of MSC which has a fixed weekly schedule calling the South African ports of Durban, Cape Town and Port Elizabeth and carrying cargo to the UK/NWC ports of Felixstowe, Antwerp, Hamburg, Le Havre and Rotterdam.
Foluke Akinmoladun is the Managing Solicitor of Trizon Law Chambers Nigeria. She is a lawyer, accountant, mediator and arbitrator. She is also a Chartered Secretary and Business Rescue & Insolvency Practitioner.
She belongs to the panel of neutrals of numerous arbitral institutions.She was a onetime Director General of the African Ship owners Association of Nigeria and is a member of the Presidential National Action Committee on Nigeria’s Implementation of the African Continental Free Trade Agreement (AfCFTA) (Transportation stream). She is the secretary of the Lagos Chamber of Commerce (LCCI) Maritime Sector. She can be reached at: Foluke.A@trizonlawchambers.com
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