A transshipment is when cargo is transferred from one vessel to another at an intermediate location before continuing on to its final destination. It usually takes place at a transit or transshipment hub.
Goods may be moved between:
- Different modes of transport (e.g. cargo plane to truck)
- The same mode of transport going on a different route (e.g. sea vessel A to sea vessel B)
Transshipments benefit shippers (consignors) by offering flexible and accessible shipment routes at lowered costs.
Example of a Transshipment
For example, if company ABC is shipping a container from Los Angeles, California to Sydney, Australia, they may opt for transshipments.
A carrier’s ship transports the container from a port in Los Angeles to a transshipment hub like the port of Singapore. At the hub, ABC’s goods will be unloaded by warehousing professionals, along with other containers from various ships. Sydney-bound shipments will then be loaded onto the next ship, ready to continue its journey.
Benefits of Transshipments
Businesses can make use of transshipments to strategize the cheapest routes for their shipments. These routes may be lower in demand or incur lower customs duties.
Some transshipments are done as part of freight consolidation, which is a more efficient way for carriers to transport goods on behalf of consignors. This increased efficiency results in more favorable transport costs for businesses.
Transshipments allow consignors to take advantage of changing market conditions to find the most efficient routes for their goods. This may also be achieved by planning routes that switch between land, air and sea freight.
It also offers greater flexibility to get around delays during times of conflict or natural disaster.
Transshipments help consignors overcome size and route restrictions, granting them greater access for the shipment of goods to ports worldwide.
- Smaller ports
Transshipment grants access to ports that are unable to accommodate larger vessels. Cargo can be moved from a big vessel to a smaller one to suit the size limitations of the destination’s port.
- Less popular locations
Not all vessels may service less popular destinations around the world. If there are no direct shipment routes from the consignor’s location, transshipment becomes a vital option to complete the shipment.
Drawbacks of Transshipments
Transshipments are likely to take more time to complete than direct shipments due to the additional steps of loading and unloading. Delays may also arise as carriers wait for consolidated shipments to fill up or due to weather and rerouting issues.
Risk of Damage
As cargo undergoes more handling during the transferring process, there is a greater risk of items being damaged or lost.
Businesses can protect themselves against risks by getting cargo insurance.
Many shipping lines allow consignors to track their transshipments online. Some common terms you may see on these pages are described below.
A ‘reschedule transshipment’ tracking status typically means that the delivery date has been revised. This may be caused when shipments need to be rerouted or if goods need to be transferred to a different vessel.
This status is usually displayed when cargo arrives late to a port, missing its scheduled transshipment. It may indicate that the intended transfer vessel has left the port and goods will be loaded onto the next available vessel instead.
Uplifted from Transshipment Hub
This status usually means that goods are being temporarily stored at the transshipment hub before it is loaded onto the next transport vehicle. It does not indicate any delay in the estimated delivery date.