MyDello celebrated its first birthday

MyDello started exactly one year ago in May, and the goal remains the same – we want future logistics to be fully automated. Over the year, it has become clear that our customers appreciate the possibility of comparing different modes of transport. As all costs increase, it is good to know that, on average, MyDello users save 15-20% on logistics.

 

MyDello’s is created by experienced experts from the field of logistics. MyDello is the most convenient way to get an immediate offer for international transport instead of many phone calls and emails. The portal displays a selection to find the most suitable transport solution for your business, taking changing circumstances into account.

Why choose MyDello?

We believe that global logistics will become fully automated in the near future. MyDello combines the various parties in the supply chain: we reduce the number of intermediaries, digitalise all information, and contribute to ensuring that the costs to logistics are minimal. According to our data, using the platform means 15-20% lower costs on average, and our customers value it highly.

MyDello’s primary goal is to provide a simple solution that a logistics specialist can handle daily. There have been major changes in logistics in the last two years due to pandemic Covid-19 and crises, and companies are looking for new ways to operate as efficiently as possible. Compared to different supply modes, it is necessary to find the best solution. For example, during the crisis in the Suez Canal, maritime transport was disrupted, and prices increased rapidly. Which delivery method to choose as a replacement? The answer is just a few clicks away.

The best part of digitalisation is that the business is more efficient and takes less time. MyDello uses different logistics service providers and carriers and brings them all together. A good overview can already be obtained with a single query. Paperless management has become more natural in every sector and country. Therefore it’s great to witness the logistics sector coming more and more digital.

MyDello has countless advantages as a digital platform. Let the numbers speak for themselves: almost 2,000 companies have joined MyDello in the year. According to the latest feedback, customers appreciate the most important way to compare prices and delivery methods.

 

MyDello shifts boundaries

The whole logistics sector has changed significantly over the last year. Nevertheless, MyDello’s first year has been very successful. The main objective, to provide services with a turnover of at least two million euros, has been achieved. Two thousand customers have joined the portal, indicating a need for a digitalised logistics service.

MyDello is currently available in Estonia, Latvia, and Lithuania. Still, we plan to continue growing and soon start offering services to Swedish companies.

Follow MyDello also on LinkedIn and Facebook.

When sending goods and selecting pallet type and packaging materials, it’s best to be careful as the wrong choice may cause additional time and be more expensive. Requirements differ according to the goods, mode of transportation and desired destination, says Peeter Vahar, the Chief Experience Officer of MyDello.

In the EU, the most common pallet is EUR (the same size as ISO1). Usually, this helps to send goods almost everywhere without any extra hustle in the customs of the country of destination. The general rule is that even if the buyer takes care of the whole logistics, it is still the consignor’s responsibility to make sure that packaging and the preparation of the invoice are done correctly. It becomes natural when sending goods more often as there are some potential risks, mainly if exporting out of Europe.

 

Wood must be fumigated

The main rule for international trade is that all wooden pallets and materials must be treated against pesticides and pests. Processing the wood will help prevent the arrival and spread of potentially dangerous pests in the country of destination. Suitable pallets are already pre-ready and heat-treated or have to go under the fumigation process in the port.

Also, it is good to know that all wooden parts that are used for packing or fastening the goods must be fumigated. Just an example: there is a machine that exceeds the standard size, and there are pretty no pre-made suitable packages for that. In this case, it is still necessary to secure the shipment by using different packing materials and, most probably, some wooden pieces. When using wood, it’s good to select pre-treated components, or the load must be fumigated before leaving the port. Fumigating before the transportation adds extra two or three days, and a certificate will be issued after the process.

In addition to wooden pallets, there are also pallets made out of plastic and metal. In terms of price and quality, the most reasonable choice is wood. The advantage of plastic is that, unlike wood, it doesn’t rot. At the same time, transport is generally in dry conditions and, for example, in a container, excessive moisture does not endanger wood.

The choice of the pallet must primarily be based on the size and nature of the goods. In different countries and regions, there are different standards for the dimensions.

 

Choose the suitable packaging materials

Packaging requirements apply to goods that may pose a higher risk to other goods, means of transport, persons or the environment in the transportation process. These requirements are regulated in international agreements. According to the type of risk, the requirements differ. For example, chemicals must be packaged in a box that withstands falls and leaks.

Suppose the goods are packed in accordance with the requirements. In that case, the transportation process does not differ, just some additional information must be provided on the goods, and the potential risks have to be avoided. However, it should be kept in mind that certain goods are subject to requirements that exclude, for example, transport in a passenger plane. For example, lithium batteries are generally only allowed to be transported in a commercial aircraft.

 

Mistakes may be pricy

If you should choose the wrong pallet or package, it probably causes some unwanted problems. Based on our experience, it is the cheapest to avoid mistakes beforehand instead of finding a solution with the customs board and the receiver afterwards. In the worst-case scenario, a wrong pallet or error in choosing the right packaging materials may mean that the whole shipment will be confiscated. The process following the mistake generally depends on the rules of a particular country and customs, but sometimes it can be solved by simply changing unsuitable packaging. However, the customs procedure and the deposit may cause additional costs.

There have also been situations where the customs authorities do not agree to destroy nonfumigated pallets in more complex cases. In this case, the sender must pay to ship goods back to the sender. However weird it may be, an empty pallet must be shipped to the other side of the world. Usually, it is not seen as a big problem, but it sure costs extra money and time. You can be pretty sure that the delivery partner is not happy with the delays in the transportation.

 

MyDello is here to help
If it’s your first time sending goods somewhere far away, or you want to double-check, feel free to contact MyDello. We will identify the specific conditions and the requirements. When sending dangerous goods, our system does not automatically display the price, but we will manually check the transport compliance before you can even notice.

 

Good to know: most common pallet types

  • EUR-pallet (ISO1) pallet in size 1200 x 800 x h mm
  • EUR-pallet is usually pre-treated or fumigated, but some non-fumigated pallets are sometimes also referred to as Euro-pallets
  • Smaller EUR 6 pallet (ISO0) 800 x 600 x h mm
  • EUR 2 (ISO2) pallet 1000 x 1200 x h mm

 

Restrictions for international freight

Airspace of Ukraine is closed for any commercial traffic. European airspace is closed for all Russian airlines. As a countermeasure Russian and Belarusian airspace is closed for European airlines. As a result, flights between Europe and Asia have been disrupted as European airlines need to fly longer routes now to avoid Russian airspace. A flight between Tokyo and Helsinki used to take 9 hours, but the adjusted route adds 4 hours of flying time now. Routes between Europe and China make a 3 hours detour on average.
Russian airlines, like Air Bridge Cargo which operated a significant amount of cargo flights between Europe and Asia, are banned to operate in European Union. After numerous cancellations and rearrangements, European carriers have managed to reestablished regular service between Europe and Asia amid the restrictions.

Although Russian Railways has been added to the list of sanctioned companies, it is still possible to keep goods moving on rail from China to Europe via Russia and Belarus. It is important to keep in mind the high risks involved. Risks related to both the war situation and any potential political decisions between EU, Russia and China can have an unexpected result for cargo on the way under not being able to enter the EU.

Most main ocean carriers have decided to stop serving Russian ports. Combined with thriving oil prices this affects freight rates. Long-term impact is yet to be seen as the market is still showing first reactions.

Coronavirus situation in China

As Coronavirus has started to spread with increasing speed in China again. China’s government has locked down Shenzhen, a city of 17.5 million people to halt the Covid outbreak. This means that also production companies cannot produce the goods. So far shipments are moving without bigger delays, but still, the risk for hold-ups is increased.

MyDello service update

The dynamics of this situation are changing fast. That’s why we are closely monitoring the situation and will report if there should be any changes or disruptions in our services. This is to ensure as smooth service as possible.

· Air freight. Service on Asia-Europe trade lane is now recovering, but the impact of reorganizing routes and a huge increase in oil price affects the rates. Air rates from China to Europe have increased on average 140% over the last two weeks. For other lanes like between Europe and Americas, there is no dramatic increase.

· Rail freight. Service on China-Europe lane is operating with no noteworthy disruptions up to this time. Shipments on the way are moving as scheduled. From the current week MyDello resumed accepting rail freight shipments from China to Europe.

· Ocean freight. Demand for ocean transport from Asia to Europe is increasing. This results in a longer waiting time between booking and vessel departure. As many ocean carriers have stopped serving Russian ports, the demand for the feeder ships in the Baltic has dropped, which may result in a less frequent feeder schedule to Baltic ports.

More updates to come in the upcoming days.

Need advice? – Feel free to get in touch and let’s discuss how we can help your business.

Shipping dangerous and hazardous goods around the world are not impossible and not uncommon it just involves more regulations and requires a bit more preparation than when shipping regular goods. What is needed to make your shipments smooth and eliminate as many hassles as possible?

 

What is classified as dangerous and hazardous goods?

Dangerous and hazardous goods are substances that when transported are a risk to health, safety, property or the environment. By identifying dangerous and hazardous, goods you are taking the first step in order to reduce the risks connected. Further steps include proper packaging, handling, and transportation.

 

Dangerous and hazardous goods are divided into nine classes 

A good starting point for determining if your products might be dangerous is by obtaining a Material Safety Data Sheet from the manufacturer and checking the “Transportation Information.” By doing so, you will receive valuable information on the risks related to transporting the products you are transporting.  

Dangerous and hazardous goods are divided into nine classes that describe different types of risks.

  • Class 1: Explosives 
  • Class 2: Gases
  • Class 3: Flammable Liquids
  • Class 4: Flammable Solids
  • Class 5: Oxidizing Agents and Organic Peroxides 
  • Class 6: Toxic and Infectious Substances 
  • Class 7: Radioactive substances 
  • Class 8: Corrosive substances 
  • Class 9: Miscellaneous batteries

Dangerous goods class 1: Explosives

Class 1 items are divided into six subdivisions that describes the potential hazard posed by the explosive. They cover substances that have an explosion hazard, explosions that may project fragments and firebrands, and fire hazards. The movement of class 1 materials is tightly regulated. 

 

Dangerous goods class 2: Gases

Class 2 items include all gases which are compressed and stored for transportation and are divided into three divisions: Flammable (also called combustible), Non-Flammable/Non-Poisonous, and Poisonous. This classification is based on the United Nations’ Recommendations on the Transport of Dangerous Goods – Model Regulations.

 

Dangerous goods class 3: Flammable Liquids

Class 3 comprises liquids or mixtures of liquids that having a flash point of not more than 60 °C (140 °F), or any material in a liquid phase with a flash point at or above 37.8 °C (100 °F) that is intentionally heated and offered for transportation or transported at or above its flash point in a bulk packaging. The flash point is the minimum temperature at which a liquid gives off vapor within a test vessel in sufficient concentration to form an ignitable mixture with air near the surface of the liquid.

 

Dangerous goods class 4: Flammable Solids

Flammable solids are any materials in the solid phase of matter that can readily undergo combustion  in the presence of a source of ignition under standard circumstances, i.e. without: Flammable solids are divided into three subdivisions that include highly flammable solids, solids that are likely to spontaneously and substances that, if they come into contact with water, emit flammable gases.

 

Dangerous goods class 5: Oxidizing Agents and Organic Peroxides

An oxidizer is a chemical that readily yields oxygen in reactions, thereby causing or enhancing combustion. This class is divided into two subdivisions and covers agents that react with oxygen and organic pesticides.

 

Dangerous goods class 6: Toxic and Infectious Substances

Poisonous material is a material, other than a gas, known to be so toxic to humans that it presents a health hazard during transportation. It is divided into two subdivisions and includes substances such as cyanide, arsenic, vaccines and pathology specimens.

 

Dangerous goods class 7: Radioactive substances

Radioactive substances are materials that emit radiation. 
Class 7 covers materials that have a specific activity greater than 70 kilobecquerels per kilogram.

 

Dangerous goods class 8: Corrosive substances

A corrosive material is a liquid or solid that causes full thickness destruction of human skin at the site of contact within a specified period of time. Corrosive items include battery acids, sulfuric acid and mercury. When shipping corrosives, care should be taken to ensure that incompatible corrosive materials cannot become mixed, as many corrosives react very violently if mixed.
https://www.faa.gov/hazmat/what_is_hazmat/

 

Dangerous goods class 9: Miscellaneous

The miscellaneous hazardous material is a material that presents a hazard during transportation but which does not meet the definition of any other hazard class. This class includes:

  1. Any material which has an anesthetic, noxious or other similar property which could cause extreme annoyance or discomfort to a flight crew member so as to prevent the correct performance of assigned duties; or
  2. Any material that meets the definition in 49 CFR 171.8 for an elevated temperature material, a hazardous substance, a hazardous waste, or a marine pollutant.

Note: Refer to the dangerous goods transportation regulations of the country of interest.
https://www.chemsafetypro.com/Topics/TDG/Class_9_Dangerous_Goods.html

 

 

 

 

Certain rules regarding quantities 

Goods that pose a possible risk have different rules when it comes to quantities. If you are shipping samples of dangerous goods, there are some options to move the goods in Excepted Quantities (no additional documents or full set of labels needed), Limited Quantities (labels, declarations needed, no certified packages needed) or Normal Quantities (Full set of documents, labels and packages needed). Shipping as small samples (Excepted or Limited Quantities) might give you an advantage on shipping costs and opportunities to move the goods. What is regarded as Excepted, Limited and Normal quantities might be depending on the certain classification of the dangerous goods. 
https://www.gov.uk/shipping-dangerous-goods/transporting-limited-quantities

 

Proper packing of dangerous goods 

When dangerous goods are shipped, it requires proper packing. Some dangerous and hazardous goods require certified boxes and tapes that have proper markings. For example, regular plastic or painter tape would not be sufficient – armed tape is needed.  In addition to packaging, proper labelling is needed. All boxes that contain dangerous goods need to have respective labels on them. Also, if the boxes are placed on a pallet and shrink-wrapped, additional labelling is needed on top of the shrink-wrap.  

 

Global regulations  

Dangerous goods require special safety focused handling and transportation. Various regulatory authorities control the transportation of dangerous goods internationally and nationally. Some of the most common frameworks for the transportation include the United Nations Recommendations on the Transport of Dangerous Goods, the IMO’s International Maritime Dangerous Goods Code, IATA’s Dangerous Goods Regulations and ICAOs Technical Instructions. 

 

Dangerous goods declaration 

Dangerous goods usually require a separate declaration, which describes the products in detail. Before filling the declaration, make sure you consult with your forwarder or carrier. Responsibility of packaging and declarations is generally the shipper’s responsibility, but professional forwarders or advisors usually have experience and are be able to help. 

 

Material Safety Data Sheet (MSDS)

When the hazardous cargo is shipped the carriers will ask for a Material Safety Data Sheet, which is known as MSDS. This data sheet must contain full information regarding the product being shipped. MSDS is very important for the carriers to consider acceptance of the product on to the vessel. It basically provides the instructions and the full requirements for handling this dangerous cargo and it must be created by the manufacturer of the product as they would have full information on the item. 

MSDS is intended to provide workers and emergency personnel with procedures for handling or working with that substance in a safe manner, and includes information such as physical data (melting point, flash point, boiling point, etc.), disposal, toxicity, reactivity, health effects, first aid, protective equipment, and spill handling procedures. Most developed countries have similar regulations and requirements however MSDS formats can vary from source to source within a country depending on national requirements.

 

Dangerous goods regulations for different transport modes


Air freight

The International Civil Aviation Organization has developed dangerous goods regulations for air transport of hazardous materials that are based upon the UN model but modified to accommodate unique aspects of air transport. Individual airline and governmental requirements are incorporated with this by the International Air Transport Association to produce the widely used IATA Dangerous Goods Regulations (DGR).  
https://www.iata.org/en/programs/cargo/dgr/faq/


Sea freight

Similarly, the International Maritime Organization  (IMO) has developed the International Maritime Dangerous Goods Code (“IMDG Code”, part of the  for transportation of dangerous goods by sea. IMO member countries have also developed the  to provide compensation in case of dangerous goods spills in the sea.


Rail freight

The Intergovernmental Organisation for International Carriage by Rail has developed the regulations concerning the International Carriage of Dangerous Goods by Rail (“RID”, part of the Convention concerning International Carriage by Rail. Many individual nations have also structured their dangerous goods transportation regulations to harmonize with the UN model in organization as well as in specific requirements. 

The Globally Harmonized System of Classification and Labelling of Chemicals  (GHS) is an internationally agreed upon system set to replace the various classification and labeling standards used in different countries. The GHS uses consistent criteria for classification and labeling on a global level.

 

Conclusion 

In general, shipping dangerous goods is more expensive and time-consuming. It’s reflected well on the shipping & packaging costs. Nevertheless, with proper planning and discussions with your forwarder, he or she can help you to make it happen – smoothly, safely and surely!  

Restrictions for international freight

The current situation between Ukraine and Russia is impacting everyone. This is a tragedy that will, first and foremost, cause great human suffering for Ukraine and the Ukrainian people. Recent days have brought decisions which among others are directly influencing international trade and global logistics.

Air traffic sees multiple restrictions. European Union has decided to ban all Russian registered, Russian-owned or Russian-controlled aircrafts from EU airspace. This means that mentioned aircrafts cannot take off, land or overfly the territory of the EU.

An increasing number of EU air carriers are banned by Russian Federation or have chosen to avoid Russian airspace, which results in longer routings, extended transit times and higher costs between Asia and Europe.

Numerous sanctions have been established, which are impacting trade with partners in Russia and Belarus. Shipments with origin or destination in Russia or Belarus have restricted options.

 

MyDello service update

During these hesitant times changes can occur within hours. That’s why we are closely monitoring the situation and will report if there should be any changes or disruptions in our services. This is to ensure as smooth service as possible.

  • Air freight service on Asia-Europe trade lane will see disruption in flight schedule, as carriers are rearranging routings to avoid Russian airspace. Please expect longer transit times and increase in cost for shipments between Europe and Asia.
  • Ocean freight service from Asia is currently operating as usual, but increased waiting time is needed
  • Rail freight service on China-Europe lane has been operating with no noteworthy disruptions up to this time. However, fast-changing political situation in regards of Russia and Belarus has created a high probability of additional restrictions, which may severely impact rail service. As a result, we have decided to not accept any new bookings for rail service at this time. We are constantly monitoring the situation and will open the service for new bookings as soon as possible

More news to come in the upcoming days.

Need advice? – Feel free to get in touch and let’s discuss how we can help your business.

Probably everyone is aware that China is the world’s biggest producer, it accomplished total $3.36 trillion in exports in 2021. Naturally, the largest import partner for Europe is China. But how do these goods arrive from China to Europe?

 

When people in Europe have a need for transportation from China, most probably they will think of two possible ways: 

  • Ocean freight – longest transit time, but lowest cost. Typically for low-value goods or big volumes. 
  • Air freight – fastest transit time, but highest cost. Typically for high-value goods or small volumes. 

But are there any other transportation possibilities? Yes, there are: 

  • Trucking – this is a new product and suits rather few. Cost is high, on the other hand, transit time is fast. It is suitable for shipments that are expensive or complex to move by air, but rail and ocean transit times miss arrival deadlines. 
  • Rail freight – good balance of transit time and cost. It is cheaper than airfreight, but faster than ocean freight. 

Since the launch of the first train on the China-Europe trade lane, it has seen at least double-digit growths year by year. There are many reasons for that, one of them being Covid 19 pandemics which caused global supply chain disruptions. Ocean freight experienced container shortage, but airfreight limited capacity due to numerous canceled passenger flights. These conditions prompted supply chains to seek alternative transportation solutions. 

Another reason for this growth is huge investments being done in rail infrastructure, where the biggest contributor is China. Rail freight is part of China’s New Silk Road, also called the “Belt and Road Initiative”, mind-blowing $160 billion infrastructure development strategy. The objective of this strategy is to invest in nearly 70 countries and organizations to build infrastructure objects like ports, railroads, bridges, roads, airports, dams and tunnels.  

 

First ChinaEurope train was launched in 2011, that year accounted 17 departed trains. In 2021 closed with number around 15000 departed trains – growth has been incredible. In January 2022 there was significant moment of 50,000th China-Europe train, since beginning just around 10 years ago. Notwithstanding all this great progress rail freight is experiencing, it is still only around 3% of total China-Europe trade volume, however it looks like its share is going to increase with years to come.

 

Year 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 
Trains 17 42 80 308 815 1792 3673 6376 8225 12405 15000 
Increase  147% 90% 285% 165% 120% 105% 74% 29% 51% 21% 

Table1: Number of trains departed and growth per year-over-year growth.  

Rail freight services are as good as good is its weakest infrastructure element, so for 2022 industry experts are forecasting rail volume increase between 20-30% by improving border crossings, train speeds and connectivity between involved parties.  


How
are rail freight goods transported?
 

One of international rail transport biggest challenges is different rail gauge standards: China and most of EU countries have 1435mm standard, but Russia, Kazakhstan and other CIS countries use 1520mm gauge standard.

 

It was important to find good solutions to efficiently reload goods and help come with ISO regulations for industry standards of 20-foot and 40-foot container types. 40-foot containers are being used the most for moving freight from China to Europe, and that has helped a lot to overcome different gauge standards and made it possible to reload containers on flatcars without opening containers. This improved reloading time at transshipment points, as well as security of transported goods. More about containers here. 

One 40’HC container has capacity of 76,4 m3 and payload slightly below 29 ton, however maximum weight restrictions can vary depending on carrier and local rules.  

You shouldn’t worry if your shipment is not big enough to fill container space. Nowadays many freight forwarders are offering LCL (less-than-container load) services where containers are stuffed with multiple shipments and transportation costs are shared between parties. Such services are great for cost optimization and for environmental reasons, as it helps to avoid transportation of half-empty containers. 

 

Rail transport routings from China to Europe 

There are two main rail routes from China: 

  1. Trans-Siberian – depending on departure location in China, routed via Mongolia or Russia. Length of main route Moscow – Vladivostok is 9289 km. 
  1. China-Europe – routed via Kazakhstan. It has length of 11179 km for initial Chongqing to Duisburg route but grew up to 13052 km for world longest rail route connecting Yiwu in China with Madrid in Spain.

China railway express routes
Main train routings between China and Europe  

Biggest international rail hubs in China are Xi`an, Chengdu, Chongqing, Zhengzhou and Urumqi. These five hubs are handling absolute majority of Chinas rail freight exports. 

From recipient side Duisburg and Hamburg in Germany and Malaszewicze in Poland are biggest European hubs for China rail import handling, however with development of new Silk Road there are many other participants who wants to get bigger piece of the pie. 

Rail freight always goes hand in hand with trucking services for last mile delivery, however this is a common practice to use trucking services for connecting longer distances as well. For example, even it is technically possible to move container from China all the way to Baltics, in most of the cases such shipments are being arranged to Poland, Belarus or Russia and then trucked down to destination in Baltics. Such a journey from terminal to terminal usually takes around 15-18 days, however we also must consider first available departure and cut-off times. 

This is a common practice because of global transportation agreements between countries, also because of technical moments of multiple reloading and seeking for balance between transit time and the cost.  

 

What cargos are mainly transported by rail freight?   

About three years ago around 80% of cargo used to be high priced products like electronics, engineering products and car spare parts, however nowadays this group stands for only around 40% of total volume. Cheaper products like textiles, plastics, rubber products are increasing their share, same as luxury goods. 

 

What is the environmental impact of rail transport?  

Because of different calculation methodologies used by different studies, CO2 numbers can differ a little per transportation mode, but overall conclusion is there – rail transport is second least environmentally harmful transportation mode.  

International Maritime Organization study shows that rail transportation is having more than ten times less CO2 produced per ton-km compared to air transport, however still producing around seven times more than least environmentally impacting shipping by ocean. 

 


CO2 per ton-km for the mail transport mode

 

Conclusion 

It looks that railway transportation is having second breath and getting back World’s attention. It is well forgotten gold what requires a bit of polishing to shine again. If set up well, it can be a good balance between transit time, cost and environmental impact which is getting more and more important. We think that railways as a solution for transportation will get used more and more for local and international freight but also for passenger movements. 

No matter if moving goods by courier or container – it is always worth knowing the risks involved in transport. 

If your business depends on shipping cargo it is well worth it to take a moment and understand the main principles of freight insurance and how your goods are protected against any unplanned events.  

Anyone ordering transport for their goods is intending to get their cargo moved from shipper to consignee, without any delays, damage to the goods etc. In real life, it doesn’t matter whether your ship air freight, ocean containers or transport via rail, things sometimes happen even to the very best transport specialists. Anyone with experience in logistics can tell you that unforeseen events, can turn your logistics upside down in a second. Unforeseen events can be transport delays caused by technical issues, weather or force majeure, but also related to mishandling, which may result in lost or damaged goods. 

This article will help you to learn more about cargo insurance, and how to protect your cargo and yourself against unpleasant surprises. 

 

What is carrier’s liability? 

Every shipment which has been handed over to a freight forwarder is protected to some level by freight forwarders or carrier’s liability. It is important to keep in mind, that your freight forwarder or carrier can be held liable only in case if the loss or damage occurs as a result of a mistake or negligence of a freight forwarder during transport.  

In case any damage or loss having occurred in transit as a result of a mistake or negligence by your carrier of freight forwarder, your carrier is liable for the loss. Bear in mind there are limitations to the extent of liability, which deviates according to the transport mode used.

Transport mode Extent of liability Standard conditions 
Air freight SDR 22.00 per kg The Montreal Convention 
Ocean freight SDR 2.00 per kg Hague–Visby Rules 
Road freight SDR 8.33 per kg CMR Convention 

Table 1. Carrier’s maximum liability on different freight modes. 

 

SDR or Special Drawing Rights was created as an international reserve asset by IMF. The value is linked to five currencies: US dollar, euro, Chinese renminbi, Japanese yen and the British pound sterling. Current value of SDR on February 3rd 2022 is 1.234 euros. Learn more about Special Drawing Rights here. 

Incoterms 2020 

International Chamber of Commerce (ICC) has introduced Incoterms to help standardize and simplify any international trade interactions involving in trade of goods. Today Incoterms 2020 is a set of standard terms used widely in international trade and exchange of goods. Learn more about Incoterms on the webpage of International Chamber of Commerce. 

When shipping cargo Incoterms rules are there to help and define the rights and responsibilities of the buyer and the seller. These rules also help to define who is liable of any loss or damage occurring when the goods are in transit. Most common incoterms used for international trade: 

  • EXW (Ex Work) – Seller’s obligation is to make goods available on their premises. Buyer is responsible for all of the transportation, including customs clearances. 
  • FOB (Free on Board) – Seller is responsible for transport up to the point, where shipment has been to the port of departure and loaded on board. 
  • DAP (Delivered at Place) – Seller is responsible for transport up to the named place of the incoterm. Usually, the named place is the Buyers location. Seller is not responsible for customs clearance at destination country. 
  • CPT (Carriage Paid to) – Seller is responsible for transport up to the port of destination. All responsibilities for unloading, customs clearance and delivery lay on the buyer. 

More detailed information regarding incoterms can be found on here.

 

When to use Cargo Insurance? 

Cargo Insurance is there to protect the owner of the goods from financial loss, which may occur due to damaged goods or loss of cargo. Freight insurance for your shipment should be considered when the value of the goods shipped is higher than what carrier’s liability would cover. 

Cargo insurance is there to cover any damages to the shipments. This is intended to cover for example any scratched or dented items but also water damage.  

When negotiating insurance policy, you can also opt to insure potential loss of profit, which may occur due to an insurance event. 


Proper packing is essential

Insurance is only able to cover the damages if it can be proven that shipper has packed the goods sufficiently and with suitable packaging. If shipper hands the shipment over to the carrier without sufficient and secure packaging or with visible damage, it will be recorded by the carrier. However, if consignee discovers any visual damage upon handover at delivery place, the consignee will have to mark that down on the delivery receipt, as this will serve as evidence that the damage occurred while shipment was in transit. 

Cargo insurance also covers loss of cargo in transit. If consignee discovers during the handover of the shipment that some of the goods are missing, this needs to be noted on the transport document upon receipt, as this serves as evidence of the loss or theft having occurred during transportation.  

How Cargo insurance works?

Below you can find the most common risks and measures which may affect your consignment when transporting. 

Damaged goods
If the shipper has handed the consignment over to the carrier with proper packaging and without any damage, yet damage has been discovered by the consignee while receiving the shipment, the damage is covered by freight insurance. 

Stolen goods
In order to declare lost goods stolen, the theft must be demonstrable. In a case when upon receipt of goods it is discovered that some or all goods are missing, it needs to be noted on the transport documentation to prove that goods were lost while in the possession of the carrier. The burden of proving a theft lies on the party which was in possession of the shipment when theft occurred. If theft cannot be proven, for example with CCTV recordings or otherwise, it will be treated as a loss. 

Delay in transport
Although your goods can be delivered without any loss or damage, it can be the case where a delayed delivery leads to consequential damage or financial loss. Usually, transit time is guaranteed only when using a premium service with dedicated and guaranteed schedule. This means that in most cases transit time is not guaranteed, which results in carriers or forwarders not accepting any liability in case of a damage created by a delay. However, in some cases it is possible to insure yourself against potential consequential damage or special damage, to protect your finances and potential loss of profit. 

General average
General average is used only in the maritime industry. It is a principle of collectively share of any damages to a sea-going vessels, which jeopardises the ship, its crew and cargo. The general average covers damages both to the ship and its cargo, but also any actions to protect the ship in danger or all costs of a salvage operation including the value of all goods that may have been sacrificed in the process. The general average is proportionally shared with the ship owners and cargo owners. 

Although it is a rare event when a consignor sea freight needs to bear a part of general average, cargo insurance usually covers this. Perhaps one of the latest case General Average declared to by the owners of Ever Given blocking the Suess canal.    

 

How to file a claim? 

It does not matter if you have freight insurance or not, you should always present a claim to the carrier of freight forwarder first to hold them liable.  

If your shipment has cargo insurance, you would file a claim with your insurer after you have held your carrier of freight forwarder liable. If the claim has been approved, your insurer will reimburse you according to the insurance policy and insurer in turn will request the carrier or freight forwarder to pay out according to their liability regulated by applicable regulations. 

China is celebrating the New Year properly with seven-day public holidays that affect both production and transport. How to prepare for the Chinese New Year, and what will be different in 2022? 

 

The New Year’s reception is the most important Chinese holiday that is also celebrated elsewhere.  

As the first day of the new year depends on the Lunar calendar, the new year falls to February 1 this year. As the holidays last practically all week, it should be taken into account that interruptions may occur in transport connections from Monday to Sunday (January 31 to February 6).

 

Workers at many factories and cargo hubs usually travel somewhere to enjoy their holidays. That means both production and transport will be limited at that time. A small part of the connections will continue to operate, but it is generally available for only large multinational companies under specific agreements. Companies that rely on Chinese imports should take holidays into account and consider that the shipment may be delayed, even if planned for the end of January. 

 

A lower capacity to serve and therefore increasing demand is also the reason why the cost of logistics before and after the new year is higher than usual. In 2022, there will be some additional influencers in addition to everyday situations. 

 

One of them is undoubtedly a Covid-19 crisis. As China is in an adamant position on the spread of the virus, increased travel and celebrations can also increase infection. This could lead to new restrictions for movement and working after holidays, meaning that loading the containers will slow down, for example. 

 

The opening of the Beijing Olympic Games also happens to be in the same week. The Games last from February 4 to February 20 and will probably cause additional security checks. The exact restrictions are still unclear, but most possibly, the Games will bring more restrictions for the capital region and elsewhere in China. In terms of the movement of goods, possible road checks and temporary closures have probably the most significant impact. 

 

cHINESE ny

 

In conclusion, China’s New Year celebration is a time when delays occur. If possible, the necessary and time-critical shipments should be planned long in advance. MyDello experts are ready to help you find the most appropriate solutions for more complex questions. 

 

Chinese holidays 

Unlike most holidays in the West, the “compensation mechanism” creates a longer and uninterrupted holiday period, meaning that the traditional Chinese holidays last from 3 days to a week.  

Upcoming Chinese holidays in 2022:  

Chinese New Year (aka Spring Festival) – January 31 to February 6 

Qingming Festival – April 3 to April 5 

Labor Day – April 30 to May 4 

Dragon Boat Festival – June 3 to June 5 

Mid-Autumn Festival – September 9 to September 11 

Chinese National Holiday – October 1 to October 7 

 

For moving your shipment from origin to destination, there are usually several different options available. Most suitable transportation mode depends on possible transport routings available between the point of origin and point of destination. For example, if you need to move your goods from New York to Amsterdam, there are no road freight and rail freight options possible.  

When selecting most efficient cargo transport mode, you need to consider how quickly your shipment should arrive to destination (transit time) and what is your budget for shipping (transportation cost). In most of the cases faster means higher cost, but not always.  

Besides transport time and cost, the cargo value and the measurements of the shipment should be also considered when selecting most efficient freight mode. In this article we will help you to understand better difference between the transport modes to make wiser decisions for your supply chain.  

 

The most used modes of transport in global freight

Recent statistics show that 70% of the global freight is shipped by ocean transport, 18% by road freight, 9% by rail, 2% by inland waterways and less than 0.25% by air. [source: https://en.wikipedia.org/wiki/Freight_transport]

 

 

Graph 1. Global transport by freight mode.

 

The most used freight modes inside European Union

Inside the EU the split of used transport modes is as follows:

  • Road transport – 49,3%,
  • Maritime transport – 32,3%,
  • Rail transport – 11,2%,
  • Inland waterways – 4,0% and
  • Oil pipelines 3,1%.

[source: https://op.europa.eu/en/publication-detail/-/publication/52f721ed-c6b8-11e8-9424-01aa75ed71a1]

 

Graph 2. Transport split by freight mode inside EU.

Types of transportation explained

There are 4 main transport mode categories in global shipping:

  • ocean freight (or maritime transport),
  • air freight,
  • rail freight and
  • road freight.

In addition, there is a multimodal transport, what means combining several different shipping modes.

In general, we can say, that the air freight is the fastest and most expensive type of cargo shipping. For bigger cargo quantities, and where it is possible, the ocean freight has the lowest shipping cost level, but it also takes the longest time. Road freight and rail freight are somewhere in between. Trucking is most flexible way of transport, but for bigger and long-distance transport there are several benefits for rail freight.

Graph 3. The 4 modes of transportation: transit time versus transportation cost.

 

Sure, things are not so black and white. In next paragraphs we will give more detailed overview of the transport modes.

Ocean freight

Ocean freight is the main mode of transport for the global trade. It’s also called lifeblood of global trade. Ocean transport the best shipping mode for the large cargo quantities, for many large cargos actually the only option (if it does not fit to the airplane).

The biggest ocean container ships have a capacity to load more than 20 000 containers.

Ocean freight – container ship with shipping containers.

 

Benefits of ocean transport

Ocean transport has the lowest cost per unit compared to other freight types, but it has also the longest transit time in most cases. For overseas transport, if the cargo size and weight is too big for the air freight, the ocean transport is the only option.

Most of the low-cost bulk cargo, such as cereals, iron, coal etc., is moved by ocean freight. It is also preferred mode of transport for high volume and heavy cargo, such as minerals, metals etc., what are just not economically reasonable to move by air.

Ocean freight has the lowest environmental impact for shipped kg compared to other freight modes; therefore, many customers are preferring this.

In short, main benefits of the ocean freight are:

  • lowest cost,
  • good for high volume goods,
  • most environment-friendly,
  • good for wide range of cargos.

 

Ocean containers

Most of the ocean cargos are shipped in containers. The main types of ocean shipping containers are:

  • Standard Container, also named Dry Container;
  • High-Cube Container;
  • Open Top Container;
  • Flat Rack Container;
  • Platform Container;
  • Reefer Container.

Shipping containers are with strict measurements to make it possible to load these on huge ocean vessels as LEGO blocks. Most commonly are used 20’ (external dimensions 6090mm x 2440mm x 2590mm) and 40’ containers (12180mm x 2440mm x 2590mm). There are also longer 45’ containers in use and some higher (High-Cube Container) and wider (Pallet Wide Container) options.

You can find more detailed info about the different container types and container dimensions from our Resources page

Ocean containers – 40 ft standard container.

What TEU stand for?

The Twenty-foot Equivalent Unit (TEU) is an exact unit of measurement used to determine cargo capacity in shipping industry (for container ships and terminals). It is based on the dimensions of a 20’ Standard Container. This means that 20’ container is equal to 1 TEU and 40’ container is equal to 2 TEU.

The ocean carrier with a 10,000 to 20,000 TEU capacity is defined as a Very Large Container Ship (VLCS), while the carrier with a capacity more than 20,000 TEU is defined as an Ultra Large Container Ship (ULCS ).

At the beginning of 2022 the largest container ship in the World is Ever ace, which can carry 24 000 TEU.

 

Full Container Load (FCL) and Less than Container Load (LCL)

Full Container Load (FCL) is an ocean freight shipment in which the cargo occupies a full container. So, FCL shipment is reasonable, if cargo volume is big and takes most of the container capacity. If customer is ordering the FCL shipment, in most cases, the empty container is delivered to place of loading, where shipper loads it with cargo.

Less than Container Load (LCL) is an ocean freight shipment wherein the shipper does not contract for a full container since the quantity of shipment is not enough to a full container and container is filled by multiple cargos from different shippers.

There is a break-even point at which the price of a large LCL shipment equals the price of a 20’ FCL container. This varies depending on what route you’re transporting from and the current situation of the ocean transport market. At MyDello platform you can easily sort and compare available LCL, FCL and other transport options by total transport cost or by transit time.

 

Air freight

Air freight is the best transport mode for the goods that require fast delivery and minimal inventory level. Half of the international air cargo is carried in the bellies of passenger aircrafts and the other half with cargo freighters.

In air freight, depending on the operating aircraft, there are size and weight limitations for the shipments.

The World’s largest cargo plane is Antonov An-225 (called also as “Mriya”). It can uplift more than 180 tons of cargo. See more here

One of the disadvantages of the air transport is its high CO2 emission for transported kg. It’s the highest compared to other transport modes.

Sometimes on the way to final destination airport the shipments are moved between the middle airports by land (called road-feeder service), but still considered as air cargo service.

Air freight – air cargo transport.

 

Benefits of air transport

Air transport is the fastest, but also the most expensive mode of shipping. Although air cargo makes only small portion of total international freight, it is essential transport mode for many industries, such as high-tech, automotive, medical etc., where time-critical deliveries are needed.

Air transport has the fastest handling processes and documentation is quite well-structured, therefore takes less time.

Air cargo needs less handling and there is no need for heavy packaging.

With air transport you can ship your cargo basically anywhere, to most of the countries and territories in the World.

 

Road freight

Road freight is the most common mode of transport for intra-continent deliveries. For example, inside Europe the road freight makes about half of the total cargo deliveries.

Sure, we also need to consider that for international air, rail and ocean deliveries, the pick-up from place of loading to international air- or seaport is done by road transport. Same applies for the final delivery to consignee location.

Regular trailer in Europe is 13.6 meters long and holds up to 33 EUR pallets.

However, road freight is quite flexible mode of transport, its efficient operation is affected by weather, road conditions and traffic.

Road transport industry has been struggling resent years due to lack of truck drivers. Truckman is not popular profession among younger generation anymore.

Road freight – trucks on highway.

Benefits of road transport (or trucking)

For short-distance deliveries the road transport is the most cost-efficient mean of transport. Road freight is relatively quick and has mostly regular time schedules in place. As it is well-regulated the expected transit-times are quite well predictable in road transport.

Road freight is flexible and available also in rural areas.

 

Full Truck (FTL) and Less than Truck Load (LTL)

Similar to ocean freight shipments, there is used full-load and part-load concept in trucking.

Full Truck Load (FTL) is a road freight shipment in which the cargo occupies a full truck.

Less than Truck Load (LTL) is a road transport shipment wherein the shipper does not contract for a full truck since the quantity of shipment is not enough to a full trailer and the trailer is filled by multiple cargos from different shippers. LTL shipments can pass several terminals and different trucks on its way to the point of destination.

At MyDello platform you can easily sort and compare available LTL, FTL and other transport options by total transport cost or by transit time.

 

Rail freight

Historically the rail freight has played important role in international cargo deliveries. Tough, in recent decades its part in total global freight has reduced, still from 2015 rail freight container deliveries from China to Europe have shown rapid increase.

When considered in terms of ton-kilometers hauled per unit of energy consumed, rail transport can be more efficient than other means of transportation. [source: https://en.wikipedia.org/wiki/Rail_freight_transport]

Compared to road freight the rail freight becomes more cost-efficient especially for long-distance deliveries.

One block train can have more than 100 wagons and only needs one driver.

The longest cargo train in the world is operating in South Africa on the 861km Sishen – Saldanha heavy-haul line. At maximum payload it has had 375 wagons with total length of 4.1 km

Rail freight – container train.

 

Benefits of rail transport

For long-distance transportation rail freight is the most environment-friendly mode of transport. Rail transport is also relatively fast. For example, rail shipment from China to EU takes about two times less time compared to ocean freight shipment.

In most cases, the rail freight is not affected by weather or traffic situation. Traditionally, rail has a strong safety record.

 

Multimodal transport

Multimodal transportation combines at least two different modes of transportation such as rail, ship, airplane and truck. For some routes multimodal transport gives faster transit time or lower transportation cost.

Sometimes the multimodal transport is the only way to move cargos to the areas difficult to reach.

 

Rail freight and trucking combined transport

Good example is moving cargos out from China by rail freight up to Poland or Germany and then onforwarding from there by road freight to final destination in Europe. This solution is about two times fasted than ocean freight, but has significantly lower cost compared to air freight.

All the biggest integrators such as DHL, UPS, Kuehne+Nagel and DB Schenker are offering rail/truck solution along Silk Road network from China to Europe.

 

Sea freight and air freight combined transport (sea/air)

With sea/air transport solution shipments move out from APAC ports by ocean freight up to Dubai and from Dubai uplifted with air freight to Europe. This solution gives about 40% faster transit time compared to pure ocean freight, but has lower total transport cost compared to pure air freight. It is also more eco-friendly.

Sea-air service map – from APAC ports to Europe.

Conclusion

There are several options for moving your shipment from origin to destination. Each transport mode has its advantages and disadvantages and there are several factors to consider before making the final choice. Still, in general, the decision comes down to (1) what transport options are available, (2) how urgently you need the cargo at destination and (3) what is your budget for shipping.

Considering your shipment’s weight and dimensions, modern logistics platforms help you to make wiser decisions between different modes of transport on transit time and price scale.

MyDello came to life because the shoe was tight in the logistics sector. There were no comprehensive digital logistics platforms in the Baltics. Therefore the shipment management was quite messy and time-consuming. In order to solve it there were two options: either integrate with an already developed solution and modify it according to your needs or take a big bite and develop one from scratch. Here are some key takeaways that we learned during this process: 

1. Put effort into choosing your partners

There have been other digital platforms on the market similar to MyDello. The ideas behind them have been good on paper to solve the customers’ issue but the execution has often been far from the end-users expectations. One cannot win the battle if you don’t know the field that well. That is why MyDello team excels with their industry knowledge as it consists of long-time logistics experts and has carefully chosen IT-industry experts on their side, combining the best from logistics and IT-development.  

 

2. Sit behind one table with your customer

MyDello came to life from the idea of making the customers’ life easier. One mistake that enthusiastic changemakers usually do is that they become too familiar with their idea concept and they forget to step aside and place themselves into the customer’s shoes. That’s why the MyDello team included end-users into the development process so that the ones who will use the platform can have a say in the functionalities, interface and everything else that is important for them. What the developer might consider comfortable might not be intuitive for the customer, therefore it has been important to walk this road together with our end-users.  

 

3. Have patience and time. But mostly patience.

 “Oh we won’t make the same mistakes as others did!” one might think before they take up a large development project. On paper the idea seems clear as daylight, achievable and all of the obstacles seem to be considered… Seems like a smooth sailing ahead. Unfortunately there are always unforeseeable obstacles that might set back the progress. Perhaps the contracts take a longer time, a crucial UX/UI flaw is found during or the end-user expresses expectations different from your initial plans. Keep an open mind towards changes and be flexible! 

 

4. Good preparation shapes your budget

As mentioned in the previous paragraph, then flexibility is important, unless it has a negative effect on your budget. Cooperate with your IT partner(s) and map out every single possible step during the process. The better you prepare the closer you will perform to your initial budget. For example from MyDello’s experience – if you decide to change something fundamental halfway through the development, then if you’re lucky, it will cost you only thousands of extra money. Worst case scenario – your budget might double or more… 

 

5. Enjoy the process!

Even though at first the challenge seems too difficult to overcome, eventually you will get the thrill of success once you see the results. One is for sure – when the challenge seems too large at first, the experience you gain will be priceless! 

 

Luckily development projects will never cease to surprise as you will always find new things to improve. Even though MyDello has reached its current phase within 3 years, it does not mean that the work is done. It is only the beginning and we will keep you posted what we learned during the next steps!