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SUMMER PROJECT REPORT ON
LOGISTICS AND EXPORT DOCUMENTATION IN
ESSAR STEEL, PUNE FACILITY
In Partial Fulfillment of Award of
Post Graduate Diploma in Business Management
By CHOPRA CHIRAG A. BARI PRASHANT S.
(PGDBM) ENTREPRENEURSHIP AND MANAGEMENT PROCESSES INTERNATIONAL
NEW DELHI-74 JULY 2010
SUMMER PROJECT REPORT ON
LOGISTICS AND EXPORT DOCUMENTATION IN
ESSAR STEEL, PUNE FACILITY
In Partial Fulfillment of Award of
Post Graduate Diploma in Business Management
By
CHOPRA CHIRAG A. BARI PRASHANT S.
(PGDBM)
ENTREPRENEURSHIP AND MANAGEMENT PROCESSES INTERNATIONAL
NEW DELHI-74
Company Guide: Faculty Guide: Mr. Madhav Gore Prof. AVK Murthy Dy. Superintendent EMPI Business School Logistics-ESPF, Pune. New Delhi.
Acknowledgement
I would like to thank Mr. Sandip Kulkarni (Head, HR Essar Steel Ltd.)
Ms. Sini George (Section officer, HR Essar Steel Ltd) for providing a
wonderful opportunity to work with Essar Steel Ltd., Pune facility.
I would also like to thank Mr. Jayesh Vora – (Head logistics, Essar Steel), my
project guide at Essar Steel Mr. Madhav Gore – (Deputy Superintendent,
logistics) and Mr. Hemant More – (Sr. Section engineer, logistics) for their
selfless support and encouragement during my entire training program.
I express my gratitude to my project faculty guide Mr. A.V.K. Murthy
(senior faculty EMPI) for his guidance and an unflinching support through my
project.
My sincere thanks to Col. Arun Dhongde (Dean, PGDBM, EMPI) for
giving me the privilege to be associated with such an esteemed organization and
carry the institutes name forward.
This project would not been possible without the untiring support provided
by my family and friends. The input and guidance provided by my seniors have
been invaluable.
We would like to extend our gratitude to all the present employees of Essar Steel, who by their
patience and cooperation, have made our project rewarding and fun filled experience.
Ms. Ipshita – (Section officer, Logistics, ESPF, Pune)
Mr. Chirag Parekh (Junior Section Officer, PPC, ESPF, Pune)
Mrs. Parvathy M. (Senior Section Officer, Logistics, ESPF, Pune)
Mr. Roopesh K. (Assistant Section Manager, Dispatch, ESPF, Pune)
Mr. Prakash Gavhane (Section Officer, Excise, ESPF, Pune)
Mr. Pandey C.H. (Assistant Superintendent, ESPF, Pune)
Mr. Narayan Joshi (Section Manager, Documentation Department, ESPF, Pune)
Mr. Tambe B.S. (Senior officer, Dispatch, ESPF, Pune)
Mr. Chandraprakash Pandey (Section officer, PPC, ESPF, Pune)
Mr. Rishikesh (Section Engineer, PPC, ESPF, Pune)
Mr. Chakraborty (Manager, PPC, ESPF, Pune)
Jai Sodha (Xerox Department, ESPF, Pune)
Yogesh Shinde (Canteen, ESPF, Pune)
With Sincere Thanks
PAGE INDEX
Topic Page No. ABSTRACT 1. INTRODUCTION 1.1 HISTORY 1 1.2 PRESENT PROFILE 1 1.2.1 STEEL 2 1.2.2 SHIPPING PORTS AND LOGISTICS 3 1.2.3 OIL AND GAS 5 1.2.4 POWER 7 1.2.5 COMMUNICATION 8 1.3 OBJECTIVES OF PROJECT 9 1.4 NEED OF PROJECT 9 1.5 SCOPE OF PROJECT 9 2. PRODUCTS SPECIFICATIONS 2.1 HOT ROLLED PRODUCTS 10 2.2 COLD ROLLED PRODUCTS 11 2.3 GALVANIZED PRODUCTS 12 3. LOGISTICS 3.1 STRUCTURE OF LOGISTICS
MANAGEMENT 14
3.2 FUNCTIONS OF LOGISTICS 17
3.3 INCOTERMS 19 4. ESPF (ESSAR STEEL, PUNE FACILITY) -
LOGISTICS
4.1 WORKFLOW OF ESSAR STEEL PUNE FACILITY
24
4.2 OVERVIEW OF LOGISTICS IN ESPF 26 4.3 FLOWCHART OF LOGISTICS IN ESPF 32 4.3.1 DESPATCH DEPARTMENT 39 4.3.2 EXCISE DEPARTMENT 44
4.3.3 DOCUMENTATION DEPARTMENT 47 5. BILLING, LICENSE AND INSURANCE 5.1 BILLING 60 5.2 LICENSE 61 5.3 INSURANCE 61
6. CONCLUSION AND RECOMMENDATION 6.1 CONCLUSION 62 6.2 RECOMMENDATION 62 7. BIBLIOGRAPHY 64
APPENDIX
A. Excise Invoice B. ARE1 C. Packing List D. Custom invoice or Pre-shipment Invoice E. Shipment copy – EP Copy F. Letter of Credit (L/C) G. Shipment Advice H. Beneficiaries Certificate I. Preferential Certificate of Origin J. Non-Preferential Certificate of Origin K. Bill of Exchange L. Commercial Invoice M. Mill Test Certificate N. Fumigation Certificate O. Bill of Lading (Draft and First print) P. Weight Note Q. Covering letter R. Delivery order S. Vessel and other important detail T. FG Status U. Mate Receipt V. Export Vehicles in plant W. Container placement Slip X. Glossary Y. Form 13
FIGURE INDEX
Figure Page No.
3.2 FUNCTION OF LOGISTICS 17 4.1 WORKFLOW OF ESPF 24 4.2(A) DIFFERENT DEPARTMENTS UNDER LOGISTICS 26 4.2(B) EXTERNAL CONNECTION OF LOGISTICS
DEPARTMENT 26
4.2.1 DELIVER ORDER FLOW IN SYSTEM 29 4.3 FLOWCHART OF ESSAR LOGISTICS IN ESPF 32 4.3.1 WORKFLOW OF DISPATCH DEPARTMENT 39 4.3.3(F) L/C FLOW IN THE SYSTEM 53 4.3.3(O) B/L FLOW IN THE SYSTEM 58
ABSTRACT
Logistics in the 21st century touches every aspect of the company's daily operations and has
grown into a business specialty of its own. Logistics is essential for the company's competitive
strategy and survival. No marketing, manufacturing or project execution can succeed without
logistics support.
On the other hand Documentation is the engine of exports in global trade. Documentation
facilitates the movement of freight, transfer of title, processing of payment, and customs
clearance. Without documentation, the shipment is at a standstill. Even with the continuing
advances in technology playing a greater role in international business, documentation is still
required by all parties involved in global trade.
So understanding the impact of effective logistics system and export documentation is very
important. This project details that how logistics and documentation process is going on
effectively in Essar Steel, Pune facility.
CHAPTER 1 INTRODUCTION
1.1 HISTORY Brothers Shri Shashi Ruia and Shri Ravi Ruia founded the Essar Group in 1969. Ruia family
originates from Rajasthan. Sometime in the 19th century, they moved to Mumbai and set up
their own business.
The name of Essar is derived from the first letter of the two brothers ‘Sashi’ and ‘Ravi’
‘S’ as ‘ESS’ & ‘R’ as ‘AR’ thus the combination of them makes “ESSAR”.
In 1990s, Essar began its steel making business by setting up India’s first sponge iron
plant in Hazira, a coastal town in the western Indian state of Gujarat. The group went on to
build a pellet plant in Visakhapatnam and eventually a fully integrated steel plant in Hazira.
Through the 1990s, with the gradual liberalization of the Indian economy, Essar seized
every opportunity that came its way. It diversified its shipping fleet, started oil & gas
exploration and production, laid the foundation of its oil refinery at Vadinar, Gujarat, and set
up a power plant near the steel complex in Hazira. The Construction business helped the Group
build most of its business assets. Essar also entered the GSM telephony business, establishing
India’s first mobile phone service in Delhi (branded Essar Cell phone) with Swiss PTT as the
joint venture partner.
Vision - We will be a respected global entrepreneur, through the power of Positive Action.
Mission - We are committed to innovative growth, through our personal passion, reinforced by
a professional mindset, creating value for all those we touch.
1.2 PRESENT PROFILE
The Essar Group is a multinational conglomerate and a leading player in the sectors of Steel,
Oil & Gas, Power, Communications, Shipping Ports & Logistics, Construction and Minerals.
With operations in more than 20 countries across five continents, the group employs 60,000
people, with revenues of about USD 15 billion in FY08-09.
1.2.1 STEEL
• A global steel producer with 14 million tonnes per annum of current capacity, with an aim
to achieve a global capacity of 20-25 million tonnes.
• Presence in key markets in Asia and North America.
• Fully integrated from mining to retail: Essar owns a global portfolio of coal and iron ore
mines and has access to all key raw materials, ensuring steady supply to its plants.
• Strong downstream capability with service centers and customer care centers, as well as
global network of retail outlets branded Essar Hypermart.
• Specialized plants for value-added steel products, like pipes and plates.
• Leadership position in the cold rolling, galvanizing and pre-coated segments.
Major Competitors:
Arcelor Mittal Processing Pvt. Ltd.
Steel Authority of India Limited.
Jindal Steel and Power Limited.
Bokaro Steel Plant.
Tata Steel.
A) CURRENT OPERATIONS 1. Hazira, Gujarat, India: 10-million tonnes steel plant at Hazira, largest in Western India.
The plant is supported by a complete infrastructure setup, including a captive port, power
plant, lime plant and oxygen plant.
Downstream facilities.
Cold Rolling plant: 1.4 million tonnes.
Galvanizing plant: 0.5 million tonnes.
A 1.5-million tonnes extra wide plate mill.
A 600,000-tonne pipe mill.
2. Visakhapatnam, Andhra Pradesh, India:
8-million tonnes pellet plant.
3. Bailadila, Chattisgarh, India:
8-million tonnes iron ore beneficiation plant.
4. Pune, Maharashtra, India:
600,000-tonnes cold rolling plant.
500,000-tonnes galvanizing plant.
400,000-tonnes color coating plant.
650,000-tonnes pickling line.
5. Algoma, Ontario, Canada:
4-million tonnes steel plant.
6. West Java, Jakarta, Indonesia:
400,000-tonnes cold rolling mill and 150,000-tonnes galvanizing line.
Steel Service Center: 200,000 tonnes.
Essar Hypermart.
B) UNDER EXECUTION
1. Paradip, Orissa, India:
12-million tonnes pellet plant at Paradip close to the port.
2. Jodha-Barbil area, Orissa, India:
12-million tonnes iron ore beneficiation plant.
3. Bhuj, Gujarat, India:
Steel service centre.
4. Minnesota, USA:
A 6-million tonnes pellet plant, a concentration plant and a direct reduced iron plant.
1.2.2 SHIPPING PORTS & LOGISTICS
• A comprehensive sea logistics company with presence in sea transportation, ports &
terminals, logistics and oilfields services.
• Shipping fleet of 25 vessels, with 12 new ships on order at an investment of more than
USD 0.6 billion.
• One of India’s largest operators of ports.
• Building a cargo handling capacity (both dry and bulk cargo) of over 150 million tonnes.
• Contract drilling services to global oil majors, with a fleet of 12 onshore rigs and one
semisubmersible offshore rig; two new jack-up rigs on order.
A) CURRENT OPERATIONS • Sea transportation:
Diversified fleet of 25 vessels including VLCCs, capsizes, Supramaxes, mini bulk
carriers and tugs.
Provides crude oil and petroleum products transportation, transportation management
services and integrated dry bulk transportation services.
Provided service for more than 220 ship years to leading Indian and global oil majors
and commodity traders.
• Ports and Terminals: Among India’s largest owners and operators of ports.
1. Vadinar (Gujarat, India): A 46-million tonnes port and terminal facility to provide
handling, storage and terminalling services for crude oil and petroleum products to refineries
and traders.
• Logistics: Provides end-to-end logistics services – from ships to ports, lighterage services
to plants, intra-plant logistics and dispatching finished products to the final customer.
Owns transhipment assets to provide lighterage support services, onshore & offshore
logistics services.
Manages a fleet of 4,200 trucks for inland transportation of steel and petroleum
products.
• Oilfields services:
Provides contract drilling and related services to oil and gas companies worldwide,
operating both offshore and onshore.
Owns a fleet of 13 rigs, which includes one semi submersible rig and 12 onshore rigs.
B) UNDER EXECUTION
• Ports & Terminals:
1. Vadinar, Gujarat, India:
Oil terminal capacity to increase to 58 million tonnes.
2. Hazira, Gujarat, India:
A 50-million tonnes all-weather deep draft port & jetty for import of iron ore, pellets,
coal, limestone and export of finished steel products.
3. Salaya, Gujarat, India:
A 20-million tonnes integrated terminal facility for handling coal and pet coke used in
power plants.
4. Paradip, Orissa, India:
14-million tonnes deep draught coal berth, as part of an agreement with the Paradip Port
Trust to execute a BOT (build-operate-transfer) project, with rights to operate the berth
for 30 years.
Developing Central Quay–3 for handling 16 million tonnes of pellets annually.
• Sea transportation: Order Book of 12 new building vessels.
• Oilfields services: Two new jack-up rigs on order.
1.2.3 OIL & GAS
• A fully integrated oil & gas company of international scale with strong presence across the
Hydrocarbon value chain from exploration & production to oil retail.
• Global portfolio of onshore and offshore oil & gas blocks, with about 70,000 sq km
available for exploration.
• Over 300,000 bpd (barrels per day) of crude refining capacity that is being expanded to
750,000 bpd, with a goal to reach a global refining capacity of 1 million bpd.
• Fifty percent stake in Kenya Petroleum Refineries Ltd, which operates a refinery in
Mombasa, Kenya, with a capacity of 80,000 bpd.
• Over 1,300 Essar-branded oil retail outlets in various parts of India, with plans to open over
2,500 outlets countrywide.
A) CURRENT OPERATIONS • Exploration and Production: Asia, Africa & Australia: Diverse portfolio of offshore and onshore Oil & Gas blocks as
well as Coal Bed Methane blocks.
1. Ratna and R-series fields, with reserves of 161 million barrels of oil equivalent, near the
Mumbai High field in the Mumbai offshore basin.
2. 50 percent interest in one shallow water offshore exploration block MB-OSN-2005/3, near
the Mumbai High field in the Mumbai offshore basin.
3. 70 percent operating interest in Mehsana oil and gas block that has started crude
production.
4. 100 percent interest in 1 CBM block in Durgapur, West Bengal, which has started
production.
5. 100 percent interest in 2 exploration blocks in Assam.
6. 100 percent interest in 1 exploratory block in Nigeria shallow offshore.
7. 100 percent interest in 2 exploratory blocks in Madagascar.
8. 100 percent rights in 2 exploration blocks in Northern Territory, Australia offshore.
9. 49.5 percent interest in 1 on-land exploration South East Tungkal block in Indonesia.
• Refining:
1. Vadinar, Gujarat, India: World-class 10.5-million tonnes or 220,000-bpd refinery
(operating at 300,000 bpd) producing fuels compliant with latest emission standards; being
progressively expanded to 18 million tonnes (380,000 bpd) and to 36 million tonnes (750,000
bpd).
Major units:
Crude Distillation Unit: Current potential capacity of 14 million tonnes.
Vacuum Distillation Unit: Current potential capacity of 7.2 million tonnes.
Vis Breaker Unit: Current potential capacity of 2.3 million tonnes (Axens, France).
Continuous Catalytic Regenerator: Current potential capacity of 1 million tonnes
(Axens, France).
Fluid Catalytic Cracking Unit: Current potential capacity of 3.5 million tonnes (Stone
& Webster).
Diesel Hydro Desulphurization unit: Current potential capacity of 4.5-million tonnes
(Axens, France).
Naphtha Hydro Treater: Current potential capacity of 1.7 million tonnes.
Dedicated infrastructure includes a captive power plant (currently 120MW, being
expanded to 1,110 MW), dispatch facilities by rail, road, sea and pipeline, associated
tankages, pipelines, water intake facilities, and a single point mooring system, which can
accommodate Very Large Crude Carriers, to receive crude.
2. Mombassa, Kenya: 50 percent stake in a 80,000 bpd refinery run by the Kenya Petroleum
Refineries Ltd (KPRL); the remaining 50 percent is owned by the Kenyan government.
• Retailing Marketing network of over 1,300 operational retail outlets, with plans to reach 2,500
outlets countrywide.
Tie-ups with oil marketing firms that give Essar Oil access to product and right to use
their terminals and facilities to place and market products, giving it pan-India presence
with over 30 supply points.
B) UNDER EXECUTION
1. Vadinar, Gujarat, India:
Expansion of existing refinery to 18 million tonnes through the addition of a Delayed
Coker Unit.
Expansion to 36 million tonnes through the addition of a new Crude Distillation Unit and
associated secondary units.
Additional single point mooring system to handle crude.
New product jetty.
Petrochemicals complex that will integrate with the refinery.
1.2.4 POWER
• Current generation capacity of 1,220 MW that is being expanded to 6,100 MW by 2012,
with a target to reach 11,470 MW in the near future.
• Growing portfolio of gas, coal and liquid fuel-based power plants.
• One of the lowest cost power producers.
• Exploring new opportunities in conventional and renewable power generation globally.
• Expanding in the transmission and distribution sectors; first private power company to get
a transmission license.
• Invested over USD 4 billion in projects under execution.
A) CURRENT OPERATIONS
1. Hazira, Gujarat, India:
515 MW combined cycle plant, gas-based; 215 MW captive to Essar Steel’s Hazira
steel plant and 300 MW supplied to Gujarat Urja Vikas Nigam.
500 combined cycle plant, gas-based; captive to Essar Steel’s Hazira steel plant.
2. Vadinar, Gujarat, India:
120 MW power equivalent co-generation plant, oil-fired; captive to Essar Oil refinery.
3. Lgoma, Ontario, Canada:
85 MW, co-generation; captive to Essar Steel Algoma plant.
B) UNDER EXECUTION
1. Gujarat, India:
Salaya: 1,200 MW, imported coal based.
Vadinar: 890 MW power equivalent co-generation plant of equivalent capacity, oil-
fired; captive to Essar Oil and will supply power and steam to the expanded refinery.
Hazira: 270 MW multifuel plants.
2. Madhya Pradesh, India:
Mahan: 1,200 MW, pit head coal based.
3. Jharkhand, India:
Tori: 1,200 MW, pit head coal based.
4. Orissa, India:
Paradip: 120 MW coal-based plants to supply power to Essar’s upcoming pellet plant in
that location.
1.2.5 COMMUNICATIONS
• A global player in the communications sector with presence in telecom services, telecom
• Tower infrastructure, telecom retail and business process outsourcing services.
• Telecom services in India and Africa.
• Partnership with Vodafone PLC, with 33 percent stake in Vodafone Essar Ltd.
• Majority stake in the telecom assets of the Dhabi Group in Uganda and the Republic of
Congo.
• 14 percent stake in Indus Towers.
• Business Process Outsourcing services.
A) CURRENT OPERATIONS
• Telecom Services:
Vodafone-Essar: Joint venture of Essar Group and the UK-based Vodafone Group, with
over 100 million subscribers.
“yu”: A GSM-based mobile services brand in Kenya with close to a million subscribers.
Telecom Retail: Operates over 1,300 The Mobile Store outlets across India.
Telecom Tower Infrastructure: 14 percent stake in Indus Towers, India’s largest tower
company with over 100,000 towers.
• Telecom-enabled Services:
Aegis, a global leader in business process outsourcing (BPO), employs over 40,000
employees with expertise in the telecom, insurance, banking and healthcare domains, as well
as engineering services, serving several Fortune 500 companies from 40 delivery centers
across India, Sri Lanka, the Philippines, USA, UK, Costa Rica, Australia, Kenya and South
Africa.
1.3 OBJECTIVES OF PROJECT This project intends to study the logistics of Essar Steels, Pune facility.
To give an understanding of the complexity involved in managing global marketing
logistics.
To describe the terms of access, trade and the different types of export documentation
required in global marketing.
To understand effectiveness of logistics management at Essar steel.
To know whether the customers are satisfied with the existing range of service pattern.
1.4 NEED OF PROJECT Logistics and documentation are very important components of modern business especially in
present scenario of globalization. A proper understanding of these would be essential for any-
body who wants to enter in these areas.
1.5 SCOPE OF PROJECT This project covers entire operation of logistics function and relevant documentation as
practices in ESPF – Essar Steel, Pune Facility.
CHAPTER 2 PRODUCTS SPECIFICATION
Essar Steel products are world-class, meeting the highest international standards. The
company's extensive marketing network and after sales service ensure high levels of customer
satisfaction.
Different Products of Essar Steel are:
2.1 Hot Rolled Products Essar Steel's produces the finest quality of Hot rolled coils in raw as well as pickled and oiled
form.
2.1.1 Coils Used for
• Transport Industry.
• Welded Steel Tubes and Pipes.
• Cold - Rolling and Drawing.
• Line Pipe.
• Corrosion Resistance.
• Boiler Quality Plates.
• Tin Mill Black Plate.
• Pressure Vessels.
2.1.2 Plates Essar Steel's high precision shearing line (SMS-USA) produces top quality steel plates that
meet demanding international standards. Essar Steel is the only Indian company to receive the
prestigious TUV Rhineland certificate for quality plates.
Essar caters to the plates demand from the following broad market segments:
Used for
• Boiler & Pressure Vessels.
• Ship Building.
• Railways.
• Heat Exchangers.
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• Oil & Petrochemicals.
• Marine Containers.
• Oil & Petrochemicals.
• Coal & Mining.
• General & Heavy Engineering.
2.1.3 Sheets
Essar Steel's high precision shearing line (Bronx-UK) turns out top quality steel sheets
meeting demanding international standards.
Essar caters to the sheets demand from the following broad market segments:
Used for
• LPG Cylinder Fabricators.
• Railways.
• Automobiles.
• Marine Freight Containers.
• General and Heavy Engineering.
2.1.4 Shot Blasted and Primed
Shot blasted and painted steel from Essar offer the cleanest surfaces and a comprehensive
environment protection to its steel. The ideal steel for use in extreme applications, shot
blasted and painted steel from Essar is India's first ever in its category.
Used for
• Welded Beams.
• Ship Building.
• Bridge Girders.
• Component Fabrications.
2.2 Cold Rolled Products Hot rolled coils from Essar Steel are used to produce cold rolled products in the coils/ plates
and sheets form. A smoother surface finish, improved tensile strength, and customized
product thickness can be achieved through cold rolling.
Used for
• Automotive Body & Components.
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• Drums & Barrels.
• White Goods.
• Pipes & Tubes.
• Furniture & Office Equipment.
• General Engineering Application.
2.3 Galvanized Products Essar Steel now offers the best of breed-galvanized products with the highest level of
customization. The products are available in the widest range of surface finishes, thickness
and corrugation levels.
Used for
• Construction.
• Corrugated Sheets.
• Agriculture Equipment.
• Automotive Applications.
• General Engineering Applications.
• White Goods.
• Color Coating.
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CHAPTER 3 LOGISTICS
Logistics is the process of planning, implementing and controlling the efficient, effective flow
of goods from the point of origin to the point of consumption for meeting the customer
requirements.
Logistics accounts for one of the highest costs of doing business. Logistics expenditure
normally ranges from 5% to 35% of sales depending on the type of business. Thus logistics
even though very important for any business success is expensive.
• Logistic management encompasses all materials flows management; from the inflow of
purchased materials into works (i.e. materials planning of raw materials components and
other products, transport of materials from suppliers to works, receiving and inspection and
storage of materials) materials flow through manufacturing processes (i.e. materials issues
and materials handling) and material flow to customers (i.e. physical distribution).
• The management (i.e. the planning, execution and control) of all factors that affect the
material flow and the information about it, seen from the perspective of customer’s
requirements for the purpose of achieving a high reliability, a high degree of completeness
and a short delivery time.
• Logistics is the concept which seeks provide for the management and co-ordination of the
activities within the supply chain from sourcing and acquisition through production, where
appropriate, and on through distribution channels to the customer. The goal of logistics is
the creation of competitive advantages through the simultaneous achievement of high
customer service levels, optimum investment and value for money.
From the above definitions, we conclude that: - Logistics management covers both physical flows of products as well as information flow
covering reports and documentation relating to goods movement.
Logistics management evolves procedures that meet customer service at the minimum cost.
Logistic management achieves cost reduction by speeding the flow of materials, work-in-
progress and finished product.
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3.1 Structure of logistics management
A) Physical Structure: A logistics system’s physical structure consists of two things:
• Stationary Facilities.
• Transportation.
Stationary Facilities:
Logistics jargon further distinguishes those facilities that are:
Outside the system (such as drug manufacturers) from which commodities are supplied;
these are called “sources”.
Facilities that receive supplies from a source (such as a central medical store) are called
“primary supply points”.
Facilities that dispense commodities to end-users are called “outlets”.
Whatever names are used, there are six important things to know about the facilities:
1. Where is the facility located?
2. How is it staffed?
3. What is the actual need for each commodity at the facility and how does this need vary
over time?
4. What is the facility’s storage capacity?
5. What are the storage conditions, and are they suitable for the items being stored?
6. How is the inventory controlled, and is it secure?
In describing the physical structure of the logistics system, it is important to note the
number of links into each facility. The more links there are, the more confused the system is
likely to be. At the top, the primary supply points probably will receive commodities from a
number of sources. At lower levels of the system, however, it is usually desirable to limit each
facility to receiving supplies through only one link (possibly with a different link for
emergency backup).
Transportation:
There are five important things to know about transportation links:
1. What types of transportation are available?
2. What size batches of commodities are cost-effective to transport?
3. How long does it take to get from one facility to the next?
4. How often can shipments be made?
5. Are the answers to these questions different during different seasons of the year?
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With this basic information in hand, the logistics system’s management structure can be
designed.
B) Management Structure:
The essential questions in understanding the management structure of a logistics system are:
• Who decides what and when and how many commodities move through a link from one
facility to the next?
• How does he/she decide?
There are two general types of logistics systems:
Allocation or “push” systems.
Requisition or “pull” systems.
In an allocation system, the higher-level facility decides what commodities move down the
system and when they move down. It “pushes” them through the system.
In a requisition system, the lower-level facility orders commodities as the need arises, thus
“pulling” supplies through the system.
The advantages of a requisition or “Pull” system are that it can be based on current
information about actual needs, and thus, in theory, is more accurate and less wasteful than
“Push” system. Decision-making is decentralized to lower levels and each manager has a
narrower scope of concern. The disadvantages of requisition systems are related directly to
these advantages. Requisition systems will work only if accurate information about needs
exists or can be obtained, and if lower level staffs have sufficient management training and
support to make appropriate decisions about ordering.
Allocation or “push” systems are, therefore, appropriate when accurate information on
needs is not available or where management skill is concentrated at higher levels of the
service system. If demand significantly exceeds supply, an allocation system must be used to
divide scarce commodities among competing facilities. Where allocation systems are used,
every effort should be made to base allocations on appropriate estimates of actual need.
This management structure may differ at different levels of the system; higher levels
may requisition and then allocate to lower levels. Even at a single level, the system may be
mixed. A regional warehouse might allocate stock to a health center every three months, but
the health center may be able to request additional supplies, if needed, in the interim. Also, it
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may be desirable to use different procedures for equipment, which is essentially a one-time
problem, than for supplies, which must be restocked on a continuing basis.
In addition to the question of who makes the decisions to move commodities, there is the
question of how the decision is made. It already has been stated that the decision should be
based on a projection of actual need; such an assessment is called forecasting or
quantification. A full discussion of forecasting is beyond the scope of these few pages; here it
is only important to note that an adequate forecasting process must consider three things:
1. Historical data: The decision maker must consider the actual past use of commodities and
how that use pattern has changed over time; simply graphing the data can do this.
2. Future program plans: The decision maker must know what the future plans for the
program are and have some way of realistically estimating the effect of those plans on the
demand for commodities.
3. Underlying assumptions: The decision maker must use proper assumptions about how
demand varies over time; for example, in a new program, demand is usually slow at first,
then increases rapidly, and finally levels off.
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Order processing
"Order processing" is the term generally used to describe the process or the workflow
associated with the picking, packing and delivery of the packed item(s) to a shipping
carrier.
Transport management
Transportation involves
Firm’s own transport (if goods are to be collected).
Hiring of transport (if services of external firm are to be used).
Routing and load planning.
Selection of the most suitable of transport (i.e. rail, road, sea or air).
Packaging needed (i.e. loose, pallets or special).
Documentation required (especially if goods are arriving from overseas).
Inventory management
Inventories require to be maintained to take care of needs between the time of demand and
time of supply. Inventory management involved decisions concerning
Buffer stocks.
Lead-time.
Replenishment of stocks.
Warehousing
Is concerned with management of space to hold inventories and it involves such problems
as
Site selection.
Space determination.
Layout and design.
Receipts and issues and storage.
Preservation.
Material handling
Materials handling is concerned with movement of product at the stocking point and it
involves such decision as
Smoothening of materials flow.
Selection of materials handling equipment.
Maintenance of materials handling equipment.
18
Packaging
Is concerned with design of packing of the product that ensures damage free movement of
the product and is conducive to efficient handling and storage.
Production scheduling
Is concerned with preparation of aggregate quantities to be produced in accordance with
demands, actual as well as projected. Product scheduling, however, dose not include day-
to-day detailed scheduling carried out by production planner.
Information system
Is a must for the successful implementation of logistics function. Database on customer
location, sales volume, inventory levels, lead times etc. must be maintained.
3.3 INCOTERMS 3.3.1 General Information
Incoterms are reviewed and published by the International Chamber of Commerce.
Internationally accepted commercial terms that clearly allocate transportation and other costs,
risks, customs, and insurance responsibilities between seller and buyer.
• First developed by the International Chamber of Commerce.
• INternational COmmercial TERMS.
• Clarify when the ownership of the merchandise takes place.
• Used in conjunction with a sales agreement or other method of transacting the sales.
• Independent of contract for carriage of goods.
• There are total 13 terms.
3.3.2 Role of INCOTERM
• Standard trade definitions commonly used in international contracts.
• Make international trade easier.
• Helps traders in different countries to understand each other.
19
3.3.3 Types of INCOTERM
Incoterms consist of 4 groups (E, F, C, D) and are listed below in order of increasing
risk/liability to the exporter. Some Incoterms only apply to ocean/inland, not air,
transportation modes.
1. Group “E” - Risk and expenses are borne by the buyer
1.1 EXW - Ex Works -- The only Incoterm in Group E represents the minimum liability to
the seller. Risk and expenses are borne by the buyer, including payment of all transportation
and insurance costs from the seller's door. EXW is used for any mode of transportation.
2. GROUP “F” - Seller pays for pre-carriage at origin but does not pay for main
carriage.
2.1 FCA - Free Carrier -- Risk passes to buyer, including transportation and insurance costs
on the buyer's collecting vehicle; it is the buyer's obligation to receive the seller's arriving
vehicle unloaded.
2.2 FAS - Free Alongside Ship -- Risk passes to buyer, including payment of all
transportation and insurance costs, once delivered alongside ship by the seller. Used for sea or
inland waterway transportation. The export clearance obligation rests with the seller.
2.3 FOB - Free On Board -- Risk passes to buyer, including payment of all transportation
and insurance costs, once delivered on board the ship by the seller. Used for sea or inland
waterway transportation (Most commonly used of F Group).
3. GROUP “C” - Seller arranges and pays for main carriage but does not assume risk.
3.1 CFR - Cost and Freight -- Risk and insurance cost pass to buyer when delivered on board
the ship by seller, who pays the transportation costs to the destination port. Used for sea or
inland waterway transportation.
3.2 CIF - Cost, Insurance and Freight -- Risk passes to buyer when delivered on board the
ship by seller, who pays transportation and insurance costs to destination port. Used for sea or
inland waterway transportation.
3.3 CPT - Carriage Paid To -- Risk and insurance costs pass to buyer when delivered to
carrier by seller, who pays transportation costs to destination. Used for any mode of
transportation.
3.4 CIP - Carriage and Insurance Paid To -- Risk passes to buyer when delivered to carrier
by seller, who pays transportation and insurance costs to destination. Used for any mode of
transportation.
20
4. GROUP “D” - Seller assumes the most cost/risk because goods must be made available
upon arrival at agreed destination.
4.1 DAF - Delivered at Frontier -- Risk and responsibility for import clearance passes to
buyer when delivered to named border point by seller. Used for any mode of transportation.
4.2 DES - Delivered Ex Ship -- Risk and responsibility for vessel discharge and import
clearance pass to buyer when seller delivers goods on board the ship to destination port. Used
for sea or inland waterway transportation.
4.3 DEQ - Delivered Ex Quay (Duty Paid) -- Risk passes to buyer when delivered on board
the ship at the destination point by the seller, who delivers goods on dock at destination point
cleared for import. Used for sea or inland waterway transportation.
4.4 DDU - Delivered Duty Unpaid -- Risk and responsibility of import clearance pass to
buyer when seller delivers goods to named destination point. Buyer is obligated to import
clearance. Seller fulfills their obligation when goods have been made available at the named
place in the country of importation. Used for any mode of transportation.
4.5 DDP - Delivered Duty Paid -- Risk passes to buyer when seller delivers goods to named
destination point cleared for import. Used for any mode of transportation.
21
CHAPTER 4 ESPF - LOGISTICS
ESPF - Logistics export their products in following countries: 1. ANGOLA
2. ARGENTINA
3. AUSTRALIA
4. BANGLADESH
5. BELGIUM
6. BENIN
7. BRAZIL
8. BULGARIA
9. CANADA
10. CHILE
11. CONGO
12. Côte d’Ivoire
13. CROATIA
14. CYPRUS
15. DENMARK
16. DOMINICAN REPUBLIC
17. ECUADOR
18. EGYPT
19. EQUATORIAL GUINEA
20. ETHIOPIA
21. FRANCE
22. GERGIA
23. GHANA
24. GREECE
25. GUINEA
26. GULF OF GUINEA
27. GUYANA
28. HAITI
29. HONDURAS
30. HORMOZGAN
31. IRAN
32. ISRAEL
33. ISTANBUL
34. ITALY
35. KENYA
36. KUWAIT
37. LEBANON
38. LITUANIA
39. MADAGASCAR
40. MALAWI
41. MALAYSIA
42. MAURITIUS
43. MOZAMBIQUE
44. MYANMAR
45. NETHERLANDS
46. NICRAGUA
47. OMAN
48. PAKISTAN
22
49. POLAND
50. PORTUGAL
51. PUERTO RICO
52. QABOOS
53. ROMANIA
54. RUSSIA
55. SAUDI ARAB
56. SENEGAL
57. SINGAPORE
58. SLOVENIA
59. SOUTH AFRICA
60. SPAIN
61. SRILANKA
62. SUDAN
63. SURINAME
64. SYRIA
65. TANZANIA
66. THAILAND
67. TOGO
68. TUNIS
69. TUNISIA
70. TURKEY
71. UAE
72. UK
73. UKRAINE
74. URUGUAY
75. USA
76. VENEZUELA
77. VIETNAM
78. YEMEN
23
24
4.1 Workflow of ESPF The workflow of Essar Steel Ltd., Pune facility is given below:
Step 1 - 2
Customer places the order to the marketing department about their requirements and last date
of delivery or last date of shipment (in case of export).
Step 3
As the detail, requirements of product receive by marketing department they contact with
Production planning and control department (PPC).
Step 4
The next step is of order preparation and execution i.e. they analyze complete set of process to
develop the required product.
Step 5
Now the production work starts and production department produces finished good.
Step 6
Now the work of dispatch department is to load the finished good i.e. coils or sheets to proper
container.
Step 7
Container is ready to move towards the final destination.
- If the delivery of goods is in foreign then shipping line is used to send the goods to its final
destination.
- If the delivery of goods is domestic then loaded truck is send directly to its destination.
Step 8
Excise and documentation department completes finally invoicing part.
In the complete process Logistics department coordinate with Dispatch, Excise and
Documentation department to complete the process effectively. In the complete process the
other department like Customer Service department (CSD), Commercial department and
material department play important role in the process.
25
4.2 Overview of Logistics in Essar Logistics Department of Essar Steel, Pune facility consist of following Sub Departments: A. Internal Structure of Logistics Department
Fig: 4.2( A) Different Department under logistics Department
These 3-department work in connection with logistics department and that completely make
the logistics system of ESSAR Steel, Pune facility.
B. External connection of Logistics Department
Fig: 4.2 (B) External connection of Logistics Department
26
Logistics department externally communicate with Shipping Line, Freight Forwarder,
Transporter, Custom House agent.
To understand the complete workflow first we have to understand some basic terms of
logistics and important details about Essar Steel, Logistics Pune facility. They are:
4.2.1 Basic terms of Logistics: Customs House Agent (CHA) - is a person who is licensed to act as an agent for transaction
of any business relating to the entry or departure of conveyances or the import or export of
goods at any Customs station.
Duties and Obligations of a CHA
• A CHA is required to clear goods for import or export only against specific authorization
from the principal and must produce it whenever required by the Deputy/Assistant
Commissioner.
• The CHA is duty-bound to advise the client to comply with the provisions of the Act and
the regulations. If there is non-compliance of provisions by any client, he is required to
bring it to the knowledge of the Deputy/Assistant Commissioner.
• The CHA has a duty to promptly pay to Government all money received from client for
payment of duties and taxes. Similarly, any money received by him from the Government
should be promptly and fully accounted to the client.
Freight Forwarder (FF) - is a person or company that organizes shipments for individuals or
other companies. A forwarder acts as an agent, in other words as a third-party
logistics provider that dispatches shipments via asset-based carriers and that books or
otherwise arranges space for these shipments. Carrier types include ships, airplanes, trucks,
and railroads. Duties and Obligations of FF • Freight forwarders typically arrange cargo movement to an international destination.
27
• Custom clearance - forwarders can complete customs paperwork on your behalf, and pay
any taxes or duties owed.
• Other documentation issues – E.g.: Bills of Lading, or any documents required by banks
before payment is released.
Port - is a location on a coast or shore containing one or more harbors where ships can dock
and transfer people or cargo to or from land.
Buffer / Warehouse - is a commercial building for storage of goods.
Manufacturers, importers, exporters, wholesalers, transport businesses, customs, etc use
warehouses. They usually have loading docks to load and unload goods from trucks.
Sometimes warehouses load and unload goods directly from railways, airports, or seaports.
Bill of lading - is document that establishes the terms of contract between a shipper and a
transportation company. It serves as a document of title, a contract of carriage, and a receipt
for goods.
A bill of lading (sometimes referred to as a BOL or B/L) is a document issued by a carrier to a
shipper, acknowledging that specified goods have been received on board as cargo
for conveyance to a named place for delivery to the consignee who is usually identified.
Note:
This is very important document and to understand B/L flow in system ( refer 4.3.3 - O
B/L Draft of documentatation department and Appendix - O for B/l draft and First print).
Delivery order (D/O) - A delivery Order is a document from a consignor, a shipper, or an
owner of freight, which orders the release of the transportation of cargo to another party.
A delivery order refers to an "order given by an owner of goods to a person in
possession of them (the carrier or warehouseman) directing that person to deliver the goods to
a person named in the order. (Refer Appendix - R for document).
28
Delivery order – D/O flow in the System
Fig: D.O. flow in System
Flow in System:
Step 1
Logistics department send container request to the Freight Forwarder.
Step 2
As per the requirement given about container Freight Forwarder request the container
from the Shipping Line.
Step 3
Shipping Line send D/O and vessel detail to the Freight Forwarder.
Step 4
Freight forwarder handover that D/O to the Logistics department.
Step 5 - 6
Logistics Department gives that D/O to the Transporter so that Transporter send empty
truck to the Shipping Yard to collect the container.
29
Step 7
Transporter shows that D/O to the Shipping yard to get the respective container.
Now the container is taken from Shipping Yard and truck comes to the Essar Steel,
Pune for Loading of product i.e. coil.
Finished Goods Status (FGS) – Status that shows the how much amount of final product is
available in Inventory.
Letter of Credit (L/C) – Letters of credit used in international transactions are governed by
the International Chamber of Commerce.
A commercial letter of credit is a contractual agreement between a bank, known as the issuing
bank, on behalf of one of its customers, authorizing another bank, known as the advising or
confirming bank, to make payment to the beneficiary. The issuing bank, on the request of its
customer, opens the letter of credit. The issuing bank makes a commitment to honor drawings
made under the credit. The beneficiary is normally the provider of goods and/or services.
Essentially, the issuing bank replaces the bank's customer as the payee.
Note: This is very important document and to understand L/C flow in system refer (4.3.3 - F
documentatation department).
4.2.2 Important details about Essar Steel – Logistics, Pune facility:
Essar Steel – Logistics, Pune facility deals with following entity to complete its process of
exporting its product to its destination.
Freight Forwarders
1. OM Freight Forwarders Pvt. Ltd.
2. Rushabh Sealink Pvt. Ltd.
3. DAMANI Shipping Pvt. Ltd.
4. Vadiyawala Logistics Pvt. Ltd.
Transporter
IDEAL Transporter.
30
CHA
Safe Clearing & Forwarding Pvt. Ltd.
Shipping Lines
• MAERKS.
• SAFMARINE.
• DELMAS.
• EMIRATES LINE.
• MSC: Mediterranean Shipping Company.
• CMA CGM: Compagnie Maritime d'Affretement Compagnie Generale Maritime.
• CSAV: Compania Sud Americana de Vapores.
• HAPAG: Hamburg-Amerikanische Packetfahrt-Aktien-Gesellschaft.
• HDS: Hafiz Darya Shipping.
• MISC: Malaysia International Shipping Corporation.
• PIL: Pacific International Lines, and many more.
Port - Nhava Sheva
Nhava Sheva is the largest port in India, handling close to 50% of the country's port traffic.
The main goods exported are cotton shirts, knitted t-shirts, sporting goods, carpets, other
textile articles like embroidery machines and etc., boneless meat, and medicaments. The main
imports are chemicals, machinery, plastics, electrical machinery, vegetable oils and aluminum
and other non-ferrous metals. It is located south east of Mumbai.
It has three terminals:
JNPCT (Jawaharlal Nehru Port Trust).
NSICT (Nhava Sheva International Container Terminal).
GTI (Gateway Terminal of India).
31
COMMERCIAL
PPC (Production Planning &
Control) Department
CSD (Customer Service
Department)
ESPF - Essar steel Pune Facility
Logistics
Freight
Forwarder
Shipping
Line
Transporter
Buffer
CHA
Custom House
AgentDespatch(Container loading)
Bank
Excise Department
DocumentationDepartment
1. L
/C
&
O
A d
eta
il
1. O
A D
eta
ils
2. FG Status
1. L
/C
&
R
em
itta
nc
e d
eta
ils
th
ro
ug
h - B
an
k &
F
in
an
ce
3. Request
for
approval
Dispatch
approval
3.1 Approved
4. Container Request
3.1
N
ot a
pp
ro
ve
d
3.1
(a
) A
pp
ro
ve
d fo
r n
ot
ap
pro
ve
d o
rd
er
OFF
LOAD
PORT
MARKETING
ESSAR Logistics
Limited
5. ASK for D.O.
5. D.O./ Vessel Detail
5. Container Request
5.1
A
sk
fo
r D
.O
.
5.2
D
.O
.
6.1 D.O.
6. Vessel Detail/D.O.
6. Vessel Detail
7. Vehicles & Container Details
7. V
esse
l d
eta
ils,
Fre
ig
ht &
L
oa
din
g
in
stru
ctio
n
8.Loading
Advise
9. S
en
d c
on
ta
in
er
10. Invoice instruction
9. invoices
10
. D
esp
atc
h d
eta
ils &
O
fflo
ad
In
stru
ctio
n
12. Not Clear/Gate Close 12. Clear/Gate Open
13. B/L Draft > first print > B/L correction > b/L final
13
. B
/L
&
Do
cu
me
nt
Approval
11
11
11
32
Step 1
Between Marketing Department and PPC (Production Planning & Control
Department).
Marketing department gives OA (order Acceptance detail) to the PPC so that PPC department
starts manufacturing the product as per the order given by marketing department.
Between Marketing Department and CSD (Customer Service Department).
Marketing department at the same time also gives OA detail and L/C (Letter of Credit) to the
CSD for further use.
Note: To understand the Letter of credit and its flow in the system refer the (4.3.3
documentation department, F-Letter of Credit, Appendix-F).
Between Marketing Department and Commercial Department.
Marketing department at the same time also gives L/C and remittance detail through bank and
finance to the Commercial department for their further use.
Step 2
Between PPC and CSD Department
PPC department always provides the FG (Finished Goods) status to the CSD department so
they can keep track on that which product is ready for dispatch. (Refer Appendix –T. FG
Status).
Step 3
Between CSD department and Commercial Department
CSD department request for order approval from commercial department then commercial
department send the approval detail i.e. order is approved or not.
Case-1 If the order is approved
Go to Step-4
33
CSD send container request (in the form of D.O., which includes the dispatchable material
quantity) to Logistics Department.
Case-2 If order is not approved
Step 3.1
CSD send detail to marketing Department about the problem why order is not approved.
(Their may be reason for not approval like L/C is not proper or Payment is due etc.)
Marketing department resolve that matter with their customer and again contact with
commercial department (3.1(a)).
Step 4
After approval CSD send container request to Logistics Department.
After receiving the request for container from the CSD department, Logistics department
work is to arrange the truck and container, so there are two possible cases:
Case 1 Freight Forwarder not involved in the process
Step 5
Between Logistics department and Shipping Line
To get the container, Logistics department ask for Delivery order from shipping line.
As per the requirements send by logistics department, shipping line sends the D.O. and vessel
detail to the logistics department.
Note: Now the D.O. and vessel detail is with logistics department.
Case 2 Freight Forwarder involved in process
(In case of Essar Steel the Freight Forwarder is involved.)
Step 5
Between Logistics department and Freight Forwarder
Logistics department request for the container to the Freight Forwarder.
34
After receiving the request,
Step 5.1 Freight Forwarder asks Shipping Line for D.O. or booking, so that they get
container detail and vessel detail.
Step 5.2 After receiving request Shipping Line gives the D.O. and vessel detail to the Freight
Forwarder.
Step 6
Between Freight Forwarder and Logistics Department
Freight Forwarder gives that D.O. and Vessel details to the Logistics department.
Note: Now the D.O. and vessel detail is with logistics department.
Step 6.1
Between Logistics department and Transporter
Now Logistics send that D.O. to the Transporter so that transporter send the Empty truck to
the Shipping Yard to collect container. After receiving the container the vehicle comes to
Essar Steel, Pune.
To understand the process diagrammatically about how the delivery order to get the container
and vessel detail flow in the system: (Refer 4.2.1 Basic terms of Logistics, page no: 28 and
Appendix R)
Step 7
Between Transporter and Dispatch department
As the vehicles come to Essar Steel, Pune in above step now the Transporter gives the vessel
and container details to the Dispatch department.
At the same time when vehicles come to ESPF one document is prepare i.e. Vehicles In Plant
for their internal use. (Refer Appendix – V. Export Vehicles in Plant).
35
Between Logistics department and Documentation department
Logistics department provides the vessel detail, Freight and loading instruction, other
important detail to documentation department so that they can use this detail to prepare all
document required in whole process.
Between Logistics department and Dispatch department
Logistics department also provides the vessel detail, Freight and loading instruction and other
important detail to dispatch department so that they can prepare loading cum check list.
Between Logistics department and Excise department
Logistics department also provides the vessel detail, Freight and loading instruction and other
important detail to Excise department so that they can prepare their documents like custom
invoice, packing list etc.
Step 8
Between Dispatch department and Excise department
Dispatch department give the Loading advice i.e. Loading slip cum checklist to excise
department for their internal use. (Refer Loading slip cum checklist from 4.3.1 Dispatch
department, Page no:40).
Step 9
Between Excise department and CHA
Excise department sends the custom invoice to the CHA in Pdf format, so that CHA prepare
the Shipping bill before the vehicle reaches to the port.
At the same time Dispatch department send the loaded container and original custom invoice
with that and also prepare one document i.e. Container Placement Slip which contain detail
like Booking no., Destination, Shipping Line, Sub contractor, Vehicle no., Container no. Seal
no., Pickup time and Pickup date etc for their use. (Refer Appendix-W, Container Placement
Slip).
As the vehicles reaches to the port driver shows the original copy of custom invoice signed
by local custom officer of Pune.
36
Step 10
Between Logistics department and CHA
Logistics department send the dispatch detail i.e. (Coil details loaded in container) and offload
instruction i.e. (port and vessel detail, Gate-In instruction or keep the coil in buffer etc.) for
further use.
Between Excise department and Documentation department
Excise department sends the invoice instruction i.e. Custom invoice to the Documentation
department so that they prepare commercial invoice using that custom invoice.
Step 11
Between Shipping line and CHA
Shipping line compare the original custom invoice given to that of Pdf given in step 9 and if
details matches then handover the shipping bill to CHA. Shipping Line also gives the FORM-
13 to the CHA to Get-In Container. (Refer form 13 from Appendix Y).
Between Transporter and CHA
If the Gate-In permission is given (FORM-13 ISSUED) CHA provide that information to the
Transporter as well as Freight Forwarder.
Between Shipping line and Freight Forwarder
Shipping Line issue the B/L i.e. Bill of Lading to the Freight Forwarder.
Between Freight Forwarder and Transporter
Freight Forwarder gives the Gate-In or Gate-Close details to the transporter so that he came to
know about status to where the unload the container in port or in buffer.
Step 12
As the container reaches to the destination port it has two cases
Case 1: Gate-In or clear
37
If the condition is Gate-In or clear then container loaded in vessel for shipment.
Case 2: Gate-Close or not clear
If the condition is Gate-Close or not clear then container is unloading in buffer till the Gate-In
allowed.
Step 13
Between Shipping Line and Documentation (Two way communication)
Documentation department prepare the B/L draft and send it Shipping line via freight
forwarder then Shipping Line compare the B/L draft with shipping bill and prepare the B/L
first print and send it to Documentation department via Freight Forwarder.
Documentation department recheck the complete B/L first print and if there is no correction
then give the information to the shipping line that prepare the B/L final print.
Now finally shipping line prepare the B/L final and send it to Documentation department.
Note: To understand B/L flows diagrammatically (Refer page 57 B/L flow in system and App-
endix O for document).
Step 14
Documentation department Uses all the information and prepare the set of all the documents
as per mentioned in L/C i.e. Letter of credit.
This complete set of documents is now send to the Exporter bank i.e. Beneficiaries bank.
This completes the complete work of Logistics department with their own internal
department (like Dispatch department, Excise department, Documentation department,
Marketing department, Commercial department and PPC department) as well as external
entities like (Freight Forwarders, Shipping line, CHA, Transporter).
38
39
4.3.1 Dispatch Department
Step-1
Dispatch department get the vessel detail, freight and loading instructions from logistics
department (flowchart step-7) and vehicle and container number from transporter (flowchart
step-7).
Step-2
They start preparing Loading slip (LS) cum checklist.
Loading slip mainly contains
• Vehicles number.
• Destination and freight detail.
• Container number.
• Customer detail.
• Delivery number.
• Delivery order item quantity.
• Coil details.
Such as - Batch number, Quantity, Batch Description, Material Description etc.
• Mode of transport.
• Shipment Document number.
• Shipment Document date.
• Total shipment Quantity.
• Material Description.
Such as – Exemption type, Sr. number Item.
• Loading point.
• No of batch loaded.
• No of wooden blocks.
• Total batch net weight.
• Total batch gross weight.
Example of Loading Slip is given in next page:
40
41
Step-3
By using the detail of loading slip, Loading is done with the help of crane. There are two
ways for Shipment:
Containerized shipment
Breakbulk shipment
As per the shipment detail given the dispatch department starts process. If the requirement is
of Containerized shipment then the process is:
• Loading for Containerized shipment –
A. Coil, Sheet is packed.
B. Packed coil, sheet is loaded in container.
C. Once the loading is over, it is ready for seal and dispatch. Essar Steel Ltd. has rights to do
the factory stuffing i.e. rights to seal the export container at factory.
42
D. After Sealed container is ready to move towards its destination i.e. the Mumbai Nhava sheva Port.
• Loading for Breakbulk shipment –
In shipping, break bulk cargo or general cargo is a term that covers a great variety of goods
that must be loaded individually, and not in intermodal containers.
A. Coil, Sheet is packed.
B. Packed coil, sheet is loaded in truck directly without container.
C. After this loaded truck is ready to move towards its destination i.e. the Mumbai Nhava sheva Port.
43
Step 4
Dispatch Department sends the delivery number and billing document to Excise Department.
Here the work of dispatch department gets over.
Logistics management not only covers physical flows of products but also information flow
i.e. covering reports and documentation relating to goods movement.
The work of Excise department and Documentation department is to prepare the
documents that are require by the customer and custom department as well as for internal use
of company.
1) Excise Invoice.
2) ARE1.
3) Packing List.
4) Shipping Bill-EP copy and EC copy.
5) Custom invoice or
6) Pre-shipment Invoice.
7) Letter of Credit (L/C).
8) Commercial Invoice.
9) Certificate of Origin (CO).
10) Beneficiary Certificate.
11) Shipping Advice.
12) Weight Note.
13) Fumigation Certificate.
14) Bill of Exchange.
15) Advising Memo.
16) Quality Certificate.
17) Bill of Lading.
18) Mill Test.
Now, what the each department do separately
4.3.2 Excise Department
Excise department receive the Delivery number and billing document from Dispatch
department. Using that they proceed further.
Excise department of Essar steel, Pune Facility working on the following documents require
for export of products and claim for rebate on excisable goods.
A) Excise Invoice
B) ARE1
C) Packing list
D) Custom Invoice
E) Shipping bill - EP copy and EC copy
44
A. Excise Invoice (See APPENDIX - A)
It contains information relating to goods movements and taxes. It is a business documents that
supplier of goods (vendor or supplying plant) sends along with deliveries of excisable goods.
It lists the goods and states, quantity and how much excise duty applies on them.
Types of excise invoice:
1. Excise Invoice Outgoing.
2. Excise Invoice Incoming.
1. Excise invoice outgoing: A business document, in India, that you prepare when you issue
excisable goods from a manufacturing plant,
For example:
To be sold to a customer.
To be transferred to another of your plants.
The excise invoice lists the goods that you have issued and states how much excise duty
applies. Your customer uses the excise invoice to claim back the excise that it has paid from
the excise authorities.
2. Excise invoice Incoming:
A business document, in India, that your vendor sends you when it delivers excisable goods.
It lists the goods and states how much excise duty applies on them. You use the excise invoice
to claim back the excise that you have paid from the excise authorities, if the goods is going to
be export in future than only.
Excise invoice created by reference document: an invoice, a pro forma excise invoice, or a
billing document.
B. A.R.E.1 (See APPENDIX - B)
ARE1 is the export document for export clearance, which shall be prepared in 5 copies
quintuplicate. This document shall bear running serial number beginning from the first day
of the financial year. During this year, for the sake of continuity, the serial number, as
started from 1.4.2001, may continue. On A.R.E.1, certain declarations are required to be
given by the exporter. The exporter or his authorized agent should sign these. The different
45
copies of A.R.E.1 forms should be of different colors indicated below:
Original: White Quadruplicate: Green
Duplicate: Buff Quintuplicate: Blue
Triplicate: Pink
Distribution of A.R.E.1 in the case of exports from the factory or warehouse:
1. Original (First Copy): The said Superintendent or Inspector of Central Excise shall return
to the exporter immediately after endorsements and signature.
2. Duplicate (Second Copy): The said Superintendent or Inspector of Central Excise shall
return to the exporter immediately after endorsements and signature.
3. Triplicate (Third Copy): Sent to the bond sanctioning authority, either by post or by
handing over to the exporter in a tamper proof sealed cover after posting the particulars in
official records.
4. Quadruplicate (Fourth Copy): Retain for official records.
5. Quintuplicate (Fifth Copy) Optional copy: The said Superintendent or Inspector of
Central Excise shall return to the exporter immediately after endorsements and signature.
C. Packing list (See APPENDIX - C)
It commonly includes an itemized detail of the package contents and does not include
customer pricing. It serves to inform all parties, including transport agencies, government
authorities, and customers, about the contents of the package. It helps them deal with the
package accordingly.
D. Custom Invoice (See APPENDIX - D)
Extended form of commercial invoice required by customs (often in a specified format) in
which the exporter states the description, quantity and selling price, freight, insurance, and
packing costs, terms of delivery and payment, weight and/or volume of the goods for the
purpose of determining customs import value at the port of destination.
46
E. Shipping bill (See APPENDIX - E)
Shipping Bill/ Bill of Export is the main document required by the Customs Authority for
allowing shipment. A shipping bill is issued by the shipping agent and represents some kind
of certificate for all parties, included ship's owner, seller, buyer and some other parties. For
each one represents a kind of certificate document.
EP Copy: Export Promotion, it simply defines to promote the export of some specific articles
(metals, etc.). Government pays some subsidy at a prespecified rate on different metals known
as Drawback.
It is prepared only if we have to claim the drawback on any specified invoice or export bill.
If we are sending the good to the buyer without claiming for Drawback then there is no need
of EP Copy.
4.3.3 Documentation Department
Documentation department of Essar steel, Pune Facility working to keep track on the
entire documentary process require for export of products.
Documentation department deals with: Firstly Documentation department receive the custom invoice and with the help of that they
prepare commercial invoice. Then they follow the instruction mentioned in Letter of credit
(L/C) to prepare all the documents.
F) Letter of Credit.
G) Shipment Advice.
H) Beneficiaries certificate.
I) Preferential Certificate of Origin.
J) Non-Preferential Certificate of Origin.
K) Bill of Exchange.
L) Commercial Invoice.
M) Mill test Certificate.
N) Fumigation Certificate.
O) Bill of Lading.
P) Weight note.
They also uses Bill of lading, Packing list, Shipping bill attach with all above document to
prepare complete set as per customer requirement.
47
F) Letter of Credit (See APPENDIX – F)
Definition:
This is very important document: If payment is to be by L/C the following should be borne in
mind when examining the L/C:
a) Confirmation of the L/C.
b) Documents stipulated in the L/C will be submitted by the exporter's bank.
c) Draft to be drawn against the L/C is for the period set out in terms of the contract, "sight
draft" is payment by the recipient or "usance draft" if credit has been allowed in the contract.
d) The credit validity period allowed in the L/C.
e) Payment against the L/C is permissible according to requirements of foreign exchange
control regulations.
Purpose of L/C:
The main purpose of letter of credit is to facilitate international trade.
It is because of this that the exporter and importer can come along because the bank serves
as a major guarantor thus facilitating the whole trading process and the chances of default
and risk is low.
It is because of this letter of credit that the exporter gets prompt payment for his goods.
On the other hand the importer remains satisfied that the exporter cannot breech the
contract because he has a strong guarantor, which allows the trust of the exporter in the
business as well.
Process of L/C:
A letter of credit arrangement will be agreed upon in the contract of sale. The buyer instructs
a bank in his own country (the issuing bank) to open a credit with a bank in the seller's
country (the advicing bank) in favors of the seller, specifying the documents, which the seller
has to deliver to the bank for him to receive payment.
If the seller tenders the correct documents during the currency of the letter of credit
arrangement, the advising bank pays him the purchase price or accepts his bill of exchange
drawn on it, or negotiates his bill of exchange, which is drawn on the buyer. Whichever
method used is pre-arranged between the seller and the buyer.
48
Types of letters of credit:
Letters of credit can be revocable or irrevocable, confirmed or unconfirmed. Whether the
credit is revocable or irrevocable depends on the commitment of the issuing bank. Whether it
is confirmed or unconfirmed depends on the commitment of the advising bank. These
commitments are undertaken to the seller, who is the beneficiary under the credit.
There are four main types of letters of credit, namely, the revocable and unconfirmed letter of
credit, the irrevocable and unconfirmed letter of credit, the irrevocable and confirmed letter of
credit, and the transferable letter of credit.
1. The revocable and unconfirmed letter of credit
Neither the issuing nor the advising bank is committed to the seller and as such the credit can
be revoked at any time. This type of credit affords little security to the seller that he will
receive the purchase price through a bank.
2. The irrevocable and unconfirmed letter of credit
In this case, the authority that the buyer gives to the issuing bank is not revocable and the
issuing bank is obliged to pay the seller provided that he has tendered the correct document
before the expiry of the credit. If the issuing bank defaults, the seller can sue them in the
country where the bank has a seat. In some circumstances, the seller can sue the issuing bank
in his own country if there is a branch office. From the point of view of the seller this type of
letter of credit is a more valuable method of payment than a revocable and unconfirmed letter
of credit.
3. The irrevocable and confirmed letter of credit
In this type of credit, the advising bank adds its own confirmation of the credit to the seller.
Thus, the seller has the certainty that a bank in his own country will provide him the finance if
the correct documents are tendered within the time stipulated. The confirmation constitutes a
conditional debt of the banker, i.e. a debt subject to the condition precedent that the seller
tenders the specified documents. The bank on the buyer’s instructions cannot cancel a
confirmed credit that has been notified.
4. Transferable
The parties to a contract of sale may agree that the credit is transferable. The seller can use
such credit to finance the supply transaction. The buyer opens the credit in favor of the seller
49
and the seller (who in the supply transaction is the buyer) transfers the same credit to the
supplier (who in the supply transaction is the seller). This type of credit is used when a person
buys goods for immediate resale and wishes to use the proceeds of resale to pay the original
seller.
The doctrine of strict compliance:
Under this doctrine, the seller, to obtain payment, must tender documents, which strictly
comply with specifications by the buyer; otherwise the correspondent bank will refuse to
honour the credit. The banks, which operate the documentary, credit act as agents for the
buyer, who is the principal, and as such they should not pay against documents that are
different from those specified.
Swift Code used in L/C:
Swift codes are the fields use for specific purpose only as per define below:
NUMBER SWIFT FIELD 700/701 DEFINITION
SWIFT FIELD EXPLAINATION
: 700 Issue of dock credit Type of transmission
: 20 Doc credit number Credit number assigned by the issuing bank
: 21 Receiver’s Reference
: 23 Reference top pre-advise
: 26E Number of amendments Number of amendments
: 27 Sequence of total Page number of total pages
: 30 Date contact agreed/ amended Date amended
: 31C Issue date The date the LC is issue
: 31D Date and place of expiry The date the LC is expires
: 31E Maturity date
: 32B Currency/Amount The currency and value of the credit
: 39A Percentage credit amount tolerance
50
: 39B Maximum credit amount
: 39C Additional amounts covered Additional amounts covered
: 40A Form of doc credit Irrevocable and/or transferable
: 41A Available With …By
: 41D Available With/By Bank the Credit is available to be paid by
: 42C Drafts at Sight or days after sight for payment
: 42A Drawee Bank the draft is drawn on
: 42M Mixed payment details
: 42P Deferred payment details Deferred payment details
: 43P Partial shipments Partial shipments allowed or not
: 43T Transshipment Transshipment allowed or not
: 44A Loading on Board/ Dispatch/ taking in charge at/ from
Commercial port loading from
: 44B For transport to Destination commercial port
: 44C Latest shipment date -
: 44D Shipment period
: 45 Goods Goods to be delivered
: 45A Description of goods and/or services
Goods description
: 46 Documents required
: 46A Documents required Documents required for payments
: 47 Additional conditions
: 47A Additional conditions Additional requirements of the LC
: 47B Additional conditions Additional conditions to be comply
: 48 Period for presentation of documents
Number of days after shipment allow documents presentation
: 49 Confirmation instructions Confirmation by the paying bank is not allowed
: 50 Applicant The applicant (usually the buyer) or
51
credit
: 50 Ordering customer Ordering customer
: 51A Applicant bank
: 51D Sending institution Sending Institution
: 53A Reimbursement bank Paying bank to negotiating bank
: 53D Reimbursement -
: 57A “Advise Through” bank
: 57D Account with bank Issuing bank’s account relationship
: 59 Beneficiary The beneficiary (usually the seller) of the credit
: 71B Charges Applicant and beneficiary responsible charges
: 72 Sender to receiver information Send and receive information
: 78 Instructions to Pay/ Accept/ Negotiating bank
-
: 79 Narrative
I/O Instead Of
Note: To see the L/C document please refer (Appendix – F)
Illustration of the complete flow of L/C system follows:
52
Letter of Credit – L/C Flow in System
53
Description:
Step 1
Customer contact with his bank (Issuing bank) who issue L/C for him as per the requirement
given.
Note: As in figure Customer belong from coutry A and his bank is ABC.
Step 2
Issuing bank issue the L/C and send to the other branch of their bank in the country where the
supplier or sellers company is.
Note: As in figure branch of bank ABC in country B i.e. supplier’s country who receive the
L/C from their own bank of country A.
In case the branch of their bank is not available in that country than the Issuing bank establish
the contract with the other bank.
Note: As in figure bank PQR is the bank in contract with bank ABC for their work of L/C.
Step 3
Now the Issuing bank branch send that L/C to the bank of supplier or Exporter i.e.
Beneficiaries’ s bank.
Note: In figure bank XYZ is the Beneficiaries’ s bank that receives the L/C from Issuing bank
branch.
Step 4
Beneficiaries’ s bank handover that L/C to the Exporter so that they start processing
requirement mentioned in the L/C.
Step A
Some times it also happens that Issuing bank of customer is same as exporter bank, it means
common bank is there between customer and supplier.
54
Note: In figure Essar Steel is the Beneficiary who finally receives the L/C and starts their
process of manufacturing the product and process all documents as per the terms and
condition mentioned in the L/C.
Step B
Some time it happens that Issuing bank don’t have their branch in exporter’s country.
In this case they made contract with other bank (Like PQR in figure) so that on behalf of
issuing bank they deal with exporter/Beneficiary’s bank.
G) Shipment Advice (See APPENDIX - G)
Letter or form sent by an exporter to a foreign buyer informing that the shipment of the
ordered goods is on its way. A copy of the invoice and the packing slip (and sometimes a
copy of bill of lading) may also be attached. Also called advice note.
H) Beneficiaries certificate (See APPENDIX - H)
The beneficiary’s certificate is provided in response to details required and requested by the
buyer/importer.
The beneficiary's certificate is a document issued by the beneficiary of the international trade
transaction, often in conjunction with a documentary collection or documentary credit/ letter
of credit (L/C). Generally there is no prescribed format for beneficiary's certificate. The
normal practice is to provide information on the beneficiary's letterhead.
Appropriate details could include:
That the goods in question conform to the specifications of the sales contract.
That the goods have been shipped on board a particular vessel or aircraft by certain date.
That certain document such as bills of lading, inspection certificates etc. have been sent by
airmail or courier to the buyer/importer or their agent.
I & J) Certificate of Origin
A Certificate of Origin (often abbreviated to CO or COO) is a document used in international
trade. It traditionally states from what country the shipped goods originate, but "originate" in
a CO does not mean the country the goods are shipped from, but the country where their
55
goods are actually made. This raises a definition problem in cases where less than 100% of
the raw materials and processes and added value are not all from one country. An often used
practice is that if more than 50% of the sales price of the goods originate from one country,
that country is acceptable as the country of origin (then the "national content" is more than
50%).
Note: In various international agreements, other percentages of national content are
acceptable.
The document may be informal, i.e. issued for example by the exporter, but often the
importing country may require a formal document, often to be confirmed by an official body
in the exporting country. The CO is primarily important for classifying the goods in the
customs regulations of the importing country, thus defining how much duty shall be paid.
I) Preferential Certificate of Origin (See APPENDIX - I)
These arrangements / agreements prescribe Rules of Origin which have to be met for exports
to be eligible for tariff preference.
J) Non-Preferential Certificate of Origin (See APPENDIX - J)
These CoO evidence origin of goods and do not bestow any right to preferential tariffs. The
agency who issue CoO would ensure that goods are of Indian origin as per general principles
governing rules of origin before granting CoO (non preferential).
K) Bill of Exchange (See APPENDIX - K)
The bill of exchange, commonly referred to as the draft or the bill, is an unconditional order in
writing, signed and addressed by the drawer (the exporter usually) to the drawee (the
confirming bank or the issuing bank usually), requiring the drawee to pay the drawer a certain
sum of money at sight or at a fixed or determinable future time.
Bills of exchange are used primarily in international trade, and are written orders by
one person to his bank to pay the bearer a specific sum on a specific date. Prior to the advent
of paper currency, bills of exchange were a common means of exchange.
A bill of exchange requires in its inception three parties--the drawer, the drawee, and
the payee. The person who draws the bill is called the drawer. He gives the order to pay
money to third party. The party upon whom the bill is drawn is called the drawee. He is the
56
person to whom the bill is addressed and who is ordered to pay. he becomes an acceptor when
he indicates his willingness to pay the bill. The party in whose favor the bill is drawn or is
payable is called the payee like bank.
L) Commercial Invoice (See APPENDIX - L)
Issued by the seller for the full realizable amount of goods as per trade term. Both exporters
and importers use the commercial invoice. Exporters use the document as proof of ownership
and an aid in securing payment for goods delivered, while importers use it to confirm that the
merchandise they have received matches what they ordered. Customs officers to figure the
correct duties and taxes on the goods being imported also use commercial invoices.
M) Mill test Certificate (See APPENDIX - M)
A Mill Test certificate or MTR is documentation from a testing facility that usually shows the
chemical makeup and physical strength/properties of materials required to meet certain
grades.
The MTR shows the percentage of alloy used in manufacture, the tensile strength, yield
strength, reduction of area, elongation, and hardness of a sample piece to represent the whole
batch of a run of material. The MTR proves that the material we receive meets the grade we
require.
N) Fumigation Certificate (See APPENDIX – N)
Fumigation certificate is required as proof that the packing materials e.g. wooden crates,
wood, wool etc), have been fumigated or sterilized. Certificates contain details such as
purpose of treatment, articles concerned, temperature range used, chemicals and concentration
used etc.
O) Bill of Lading (See APPENDIX - O)
Purpose of B/L: A bill of lading (sometimes referred to as a BOL or B/L) is a document
issued by a carrier to a shipper, acknowledging that specified goods have been received on
57
board as cargo for conveyance to a named place for delivery to the consignee who is usually
identified.
Bill of Lading - B/L Flow in the System:
B/L Flow in System:
Step 1
Logistics department send the B/L request to the Documentation department.
Step 2
Documentation department on the request of Logistics department prepare the B/L draft and
send it to the Freight Forwarder.
Step 3 Freight Forwarder gives that B/L draft to Shipping Line. On the basis of that B/L draft
Shipping Line prepares the B/L first print and send it to the documentation department via FF.
Step 4
Now, Documentation department check the B/L first print and if there is any correction than
that corrected B/L is again send it to the Shipping Line via Freight Forwarder.
58
Shipping Line finally prepares Final B/L and again sends it to the Documentation department
via Freight Forwarder.
Step A
There are some cases in which Documentation department directly deals with Shipping Line
for complete B/L process (like some time in FOB cases).
Note:
B/L Draft: As specified in purpose it is a temporary copy about the details require by
shipping line to prepare B/L first print. (See Appendix – O. B/L Draft)
B/L First Print: Shipping Line uses that B/L Draft and prepares first print of that in their
standard format. (See Appendix – O. B/L First print)
Final B/L: It is a copy prepared by shipping Line after complete correction done by
Documentation department.
P) Weight note (See APPENDIX - P)
Required to confirm the packets or other form are of a stipulated weight. It is most often used
in the export goods sold on weight basis. The official weigher on the dock or the independent
certified weigher issues it.
59
CHAPTER 5 BILLING, LICENSE AND INSURANCE
5.1 BILLING There are generally 3 kinds of billing done by Logistics, ESPF. [1] Transportation payment.
[2] Custom House Agent (CHA) payment.
[3] Freight Forwarder payment. [1] Transportation Billing: ESSAR has contact with Ideal transportation. Whenever any product has to be send to the
source port ESSAR deals with Ideal transportation. There are mainly two kinds of transport
facility available from Ideal:
Containerize.
Break-bulk.
And bills are generated as per transport facility.
[2] Freight Forwarder Billing: There are generally two types of bills in case of freight forwarder: I. Normal Billing: This is applied when company complete it’s task through 3PL and in case
of ESSAR it is Rushabh, Damani, OM and Vadiawala are the main freight forwarders who
works for them.
II. FOB (Freight on Board) Billing: This is applies if the customer has selected it’s own
freight forwarder but difference from the above one is only that it does not consider freight
charges.
[3] Custom House Agent (CHA) Billing: Custom House Agent is the person who clears the custom related task for the company and
company pays the charges for it.
60
Note: We are not able to show the billing documents in appendix because it confidential part
of ESPF.
5.2 LICENSE License is one of the important documents. It provide company to export their products in
foreign countries with different type of scheme like remission scheme, EPCG scheme, ECGC
scheme, DEPB Scheme and many more define by Ministry of commerce and industry. Which
is beneficial for duty exemption and many other benefits in terms of money and to import
other products.
Note: We are not able to provide much detail about license and its document in appendix
because it confidential part of ESPF.
5.3 INSURANCE Insurance is also one of important document because it covers physical damage to, or loss of
your goods whilst transit by land, sea and air.
Note: We are not able to provide much detail about insurance and its document in appendix
because it confidential part of ESPF.
61
CHAPTER 6 CONCLUSION AND RECOMMENDATIONS
6.1 Conclusion The Indian steel industry is among the upcoming industries of the world. It has a number of
iron ores, which means that it has plenty of resources from which to draw its raw material.
The rate of production of steel in India has been going up at a steady rate in the last few
years.
Global marketing logistics, referred to earlier in chapters can present to the unwary and
uninitiated an enormously formidable barrier. Having the correct documentation internally
and externally is vital or goods and services just simply cannot be exported.
Marketers or their agents must be familiar with Terms of Access, contracts, trade terms,
commercial documents including insurance and financial documents, and the consequences of
breaking any of the terms and conditions.
In many products, the more familiar the distribution network players are with each other and
their individual systems, the easier the documentation process becomes to set up and operate.
This reduction of transaction risk is a bonus and may involve the use of specialist agencies
like freight forwarders and shippers.
6.2 Recommendation [1] Multiple Loading Points: One way of loading the truck very fast is to have multiple loading points instead o having
only one or two. By having more than one loading point one truck does not need to wait for
another one to get loaded, it can also load it’s truck from another loading point simultaneously.
Due to this waiting time will be reduced.
[2] Warehouse Management: Warehouse management is one of the most important activities in logistics because it is the
place where your final product is being placed so the proper management should be there in
warehouse like:
62
[a] Codes nomenclature: Product should be placed in such a way that it can be easily found from the large number of
products for that purpose it should have standard specification.
For example:
Section Row Column Product No. A 2 3 876345 Table: Code nomenclature for Warehouse management Here in the above example it shows that product number 876345 resides in A section’s 2nd
row 3rd column.
By following such type of standard rule it is very easy to find the product where it is actually.
[b] Place the product properly: The product should not be placed one over another or if it is placed than it should not be more
than 3 levels because it will damage the product reside in bottom and its cost lakhs of rupees.
[c] Identification mark: There should be proper identification mark on the product, which shows whether the product
is being exported at international level or domestic level.
4. SMS Portal: As the plant is very big, in order to maintain effective logistics in the company a proper
communication should be there among the people and SMS portal would be one of the
services that will keep all the logistics person in contact. Whatever the necessary information
that needs to be delivered timely can be easily forwarded to everyone at a right time. Many a
times there is a need of meeting to be conducted but in case if the management is running
short of time in this case also this service would be helpful.
5. Commercial Vehicle Operation (CVO) Commercial Vehicle Operations is an application of Intelligent Transportation Systems for
trucks. A typical system would be purchased to track the location of truck.
63
CHAPTER 7 BIBLIOGRAPHY
[1] http://www.essar.com
[2] http://www.essarsteel.com/steel.htm
[3] http://www.iccwbo.org
[4] http://dgft.gov.in
[5] Brodie, Peter. Dictionary of Shipping Terms, Third Edition, 1997.
[6] Sullivan, Eric. The Main Encyclopedic Dictionary, Fifth Edition, 1996.
[7] Keegan, W.J. 1989, "Global Marketing Management", 4th ed., Prentice Hall International
Edition.
[8] Kwelepeta, S.L "Export Documentation", op. cit. pp 89-98.
64
APPENDIX -
A) Excise Invoice.
B) ARE1.
C) Packing List.
D) Custom invoice or Pre-shipment Invoice.
E) Shipping Bill-EP Copy
F) Letter of Credit (L/C).
G) Shipping Advice.
H) Beneficiary Certificate.
I) Preferential Certificate of origin
J) Non-Preferential Certificate of origin
K) Bill of Exchange.
L) Commercial Invoice.
M) Mill Test.
N) Fumigation Certificate.
O) Bill of Lading
P) Weight Note.
Q) Covering Letter.
R) Delivery Order.
S) Vessel and other Important Details.
T) FG Status.
U) Mate receipt.
V) Export vehicles in Plant.
W) Container placement Slip.
X) Glossary.
Y) Form 13.
CONTAINERWISE PACKING LISTExporter/ Beneficiary
ESSAR STEEL LTD
(PRECOATED FACILITY)-
GAT NO.740 PUNE-NAGAR ROAD,SANASWADI, TAL : SHIRUR, PUNE ,
412 208 INDIA
CONTAINERWISE PACKING LIST NO. : 30000000** DT. 04.05.2010
BUYER / APPLICANT :
ASE METALS NV DE KEYSERLEI 58
2018 ANTWERPEN,
BELGIE
Marks No Full Description of Material Net Weight ( MT
)
Gross Weight(
MT )
GALVANIZED COILSSHIPPING MARKSASE METALS612.0087CAUCEDODOMINICAN REPUBLICSIZEWEIGHT
27.670 27.985
NET WEIGHT: 27.670 MT GROSS WEIGHT: 27.985 MT
Total 27.670 27.985
CONTAINER NO SEAL NO AND COIL WISE DETAILS AS PER ANNEXURE I For ESSAR STEEL LTD(PRECOATED FACILITY)-
AUTHORISED SIGNATORY
DC No : FOBEA1M621165
DC Date : 05.02.2010
Port of Loading : NHAVA SHEVA PORT, INDIA
For Transportation To : CAUCEDO
VESSEL NAME : CMA CGM AZURE
VOY NO. : EP648W
NO. OF COILS/BUNDLE : 7
PACKING LISTANNEXURE I
Sr.no. Coil/ Bundle No SIZE EXACT Net Weight (MT) Gross Weight (MT)CONTENT Of Each Coil Of Each Coil
ECMU 12214670375086
1 GP10C04702 1.27MM TCT X 1219MM X COIL 1 COIL 2.700 2.7452 GP10C04699 1.27MM TCT X 1219MM X COIL 1 COIL 3.955 4.0003 GP10C04700 1.27MM TCT X 1219MM X COIL 1 COIL 4.080 4.1254 GP10C04695 1.27MM TCT X 1219MM X COIL 1 COIL 4.175 4.2205 GP10C04696 1.27MM TCT X 1219MM X COIL 1 COIL 4.220 4.2656 GP10C04697 1.27MM TCT X 1219MM X COIL 1 COIL 4.240 4.2857 GP10C04698 1.27MM TCT X 1219MM X COIL 1 COIL 4.300 4.345
27.670 27.985
TOTAL WEIGHT 27.670 27.985
TOTAL NUMBER OF COILS 7
pUNJABCON~E9R" ~.Q:I . SeivieeC~ntre
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. GUo~ C~rt ificate 5 .
ESSAR STEEL LTD(PRECOATED FACILITY)-
GAT NO.740 PUNE-NAGAR ROADSANASWADI, TAL : SHIRUR, PUNE ,
412 208 INDIA
BENEFICIARY'S CERTIFICATE
REF : 3000000** DATE: 02.06.2010
WE HEREBY STATE THAT COPY OF REQUIRED DOCUMENTS HAVE BEEN SENT DIRECTLY
TO
ASE METALS N.V., DE KEYSERLEI 58, B-2018
ANTWERPEN WITHIN 3 DAYS AFTER B/L DATE
RELATIVE COURIER RECEIPT IS ATTACHED HEREWITH
FOR ESSAR STEEL LTD
(PRECOATED FACILITY)-
.
AUTHORISED SIGNATORY
ESSAR STEEL LTD(PRECOATED FACILITY)-
GAT NO.740 PUNE-NAGAR ROADSANASWADI, TAL : SHIRUR, PUNE ,
412 208 INDIA
BILL OF EXCHANGEDRAWN UNDER IRREVOCABLE DOCUMENTARY CREDIT NO. FOBEA1M62165000 DATED05.02.2010 OF FORTIS BANK S.A./ N.V.BRUSSELS( ALL BELGIAN OFFICES) BRUSSELS)
NO: 30000000** DATE:04.05.2010
EXCHANGE FOR USD *****
AT SIGHT
PAY THIS SECOND OF EXCHANGE (FIRST OF THE SAME TENURE AND DATE BEING UNPAID)
TO ORDER OF
THE SUM OF US DOLLAR **********************************************************************TWENTY-FIVE ONLY FOR THE VALUE CHARGE THE SAME TO THE ACCOUNT OF 7 COILSSHIPPED BY CMA CGM AZURE VOY NO. EP648W VIDE BILL OF LADING NO. *****DT.04.05.2010 AND OUR COMMERCIAL INVOICE NO. 30000000**** DATE.04.05.2010
TOFORTIS BANK NV/SABELGIUM
FOR ESSAR STEEL LTD(PRECOATED FACILITY)-
AUTHORISED SIGNATORY
COMMERCIAL INVOICEExporter/ Beneficiary
ESSAR STEEL LTD
(PRECOATED FACILITY)-
GAT NO.740 PUNE-NAGAR ROAD,SANASWADI, TAL : SHIRUR, PUNE ,
412 208 INDIA
COMMERCIAL INVOICE NO. : 30000000* DT. 04.05.2010
BUYER / APPLICANT :
ASE METALS NV DE KEYSERLEI 58
2018 ANTWERPEN,
BELGIE
Marks No Full Description of Material QUANTITYMT
Unit Price TOTAL AMOUNTUSD / MT IN USD
Container No ECMU 1221467 Seal No 0375086
GALVANIZED COILS,ACC TO ASTM A-653 OR EURONORM DX51D OR EQUIVALENT,ZINC COATING G90,MINIMUM SPANGLE,TEMPLATED,PASSIVATED,CHROMATED,DRY,CW BETWEEN 2 AND 5 MTSPECIFICATION :
1.27 MM TCT X 1219MM X COIL 27.670 ******* *********
INVOICING ON ACTUAL NET WEIGHT.
SHIPPING MARKS :ASE METALS612.0087CAUCEDODOMINICAN REPUBLICSIZEWEIGHT
PORT OF DISCHARGE : CAUCEDO
DELIVERY TERMS : CFR CAUCEDO
NET WEIGHT: 27.670 MT GROSS WEIGHT: 27.985 MT
Total 27.670 *********
TOTAL AMOUNT : US DOLLAR ************************************
CERTIFICATION:THE ORIGIN OF GOODS, CONTENTS ARE TRUE AND AUTHENTIC, PRICES CORRECT ANDCURRENT & THAT IS THE ONLY INVOICE FOR MERCHANDISE DESCRIBED THEREIN STATINGTHAT THE GOODS COVERED BY THIS INVOICE ARE MANUFACTURED / PRODUCED IN INDIA ANDARE OF INDIAN ORIGIN
For ESSAR STEEL LTD(PRECOATED FACILITY)-
AUTHORISED SIGNATORY
DC No : FOBEA1M611650000DC Date : 05.02.2010
Port of Loading : NHAVA SHEVA PORT, INDIA
For Transportation To : CAUCEDO
VESSEL NAME : CMA CGM AZURE
VOY NO : EP648W
NO.OF COILS : 7
Page 1 of 1
Certificate No. : 30000000**
Date of issue : 04.05.2010
Exporter / Beneficiary : BUYER/APPLICANT:
ESSAR STEEL LTD ASE METALS NV
( PRECOATED FACILITY DE KEYSERLEI 58
GAT NO, 740 PUNE- NAGAR ROAD 2018 ANTWERPEN BELGIESANASWADI, TAL : SHIRUR, PUNE. 412 208 INDIA
Material Description : GALVANIZED COILS
ZINC COATING
Sr. COIL SIZES 275GSM ( G-90) C % Mn % S % P % REMARK
No. NO Specified 0.150 MAX 0.600 MAX 0.030MAX 0.035MAX OK
1 GP10C04702 1.27MM TCT X 1219MM X COIL 275 0.043 0.236 0.013 0.011 OK
2 GP10C04699 1.27MM TCT X 1219MM X COIL 275 0.041 0.228 0.009 0.008 OK
3 GP10C04700 1.27MM TCT X 1219MM X COIL 275 0.040 0.221 0.011 0.010 OK
4 GP10C04695 1.27MM TCT X 1219MM X COIL 275 0.038 0.253 0.010 0.009 OK
5 GP10C04696 1.27MM TCT X 1219MM X COIL 275 0.040 0.215 0.008 0.010 OK
6 GP10C04697 1.27MM TCT X 1219MM X COIL 275 0.043 0.223 0.012 0.011 OK
7 GP10C04698 1.27MM TCT X 1219MM X COIL 275 0.039 0.236 0.010 0.012 OK
FOR ESSAR STEEL LTD ( PRECOATED FACILITY )
AUTHORISED SIGNATORY
CHEMICAL ANALYSIS AND MECHANICAL PROPERTIES.
MILL TEST CERTIFICATE
SHIPPER:
ESSAR STEEL LTD. (PRECOATED FACILITY) PORT OF LOADING:GAT NO 740 , PUNE NAGAR ROAD, NHAVA SHEVA PORT, INDIA
SANASWADI , INDIA
CONSIGNEE: FINAL DESTINATION :OOO 'SEVMETALLSNAB SPB SAINT PETERSBURG PORT, RUSSIAKAMCHATSKAYA STR, 13, A192007, SAINT PETERSBURG, AGENTS ADDRESS AT PORT OF DISCHARGERUSSIA Pls Enter Here
NOTIFY:
' VNESHTRANSPORT ' LLC LDS: 30.04.2010
PORT OF DISCHARGE : VESSEL NAME: MAERSK KALMAR / 1006
SAINT PETERSBURG PORT, RUSSIA ETD: 26.04.10
Description of Goods
NET WEIGHT (MT) : 63 COILS341.000 13 X 20' CONTAINERS SAID TO CONTAIN 63 COILS
GROSS WEIGHT (MT) : PRIME PREPAINTED GALVANIZED STEEL COILS346.110
TERMS OF DELIVERY : CFR SAINT PETERSBURGFREIGHT PREPAID PORT, RUSSIA (INCOTERMS 2000)
' SHIPPED ON BOARD'' S. BILL NO.IEC NO. 0388147831
SR. NO. CONTAINER NO. SEAL NO. COILS NET WEIGHT (MT) GROSS WEIGHT (MT)
1 MSKU 2076968 ML-IN 1930538 5 27.375 27.825
2 MSKU 5647377 ML-IN 1934940 4 26.085 26.445
3 PONU 0078051 ML-IN 1934261 5 26.085 26.535
4 TEXU 2479294 ML-IN 1930522 5 26.245 26.695
5 PONU 0448808 ML-IN 1934902 5 25.890 26.290
6 POCU 0467492 ML-IN 1934935 5 25.500 25.950
7 PONU 0095995 ML-IN 1934954 4 26.355 26.555
8 MSKU 3527454 ML-IN 1934926 5 27.500 27.900
9 MSKU 7931649 ML-IN 1934950 5 25.795 26.195
10 KNLU 3372893 ML-IN 1934996 5 25.830 26.230
11 TTNU 3921162 ML-IN 1934916 5 26.275 26.675
12 MSKU 2789383 ML-IN 1934933 5 25.030 25.380
13 MSKU 2127495 ML-IN 1934993 5 27.035 27.435
Total Coils - 63 341.000 346.110
MAEUSCAC
B/L No.
VERIFYCOPY
THREE/3
Shipped on Board Date ( Local Time )
2010-04-26
This transport document has one or more numbered attachments
Freight & Charges Rate Unit Currency Prepaid Collect
SHIPPED, as far as ascertained by reasonable means of checking, in apparent good order and condition unless otherwise stated herein, the total numberor quantity of Containers or other packages or units indicated in the box entitled "Carrier's Receipt" for carriage from the Port of Loading (or the Placeof Receipt, if mentioned above) to the Port of Discharge (or the Place of Delivery, if mentioned above), such carriage being always subject to the terms,rights, defences, provisions, conditions, exceptions, limitations, and liberties hereof (INCLUDING ALL THOSE TERMS AND CONDITIONS ON THE REVERSEHEREOF NUMBERED 1-26 AND THOSE TERMS AND CONDITIONS CONTAINED IN THE CARRIER'S APPLICABLE TARIFF) and the Merchant's attentionis drawn in particular to the Carrier's liberties in respect of on deck stowage (see clause 18) and the carrying vessel (see clause 19). Where the bill oflading is non-negotiable the Carrier may give delivery of the Goods to the named consignee upon reasonable proof of identity and without requiringsurrender of an original bill of lading. Where the bill of lading is negotiable, the Merchant is obliged to surrender one original, duly endorsed, in exchangefor the Goods. The Carrier accepts a duty of reasonable care to check that any such document which the Merchant surrenders as a bill of lading isgenuine and original. If the Carrier complies with this duty, it will be entitled to deliver the Goods against what it reasonably believes to be a genuineand original bill of lading, such delivery discharging the Carrier’s delivery obligations. In accepting this bill of lading, any local customs or privileges tothe contrary notwithstanding, the Merchant agrees to be bound by all Terms and Conditions stated herein whether written, printed, stamped orincorporated on the face or reverse side hereof, as fully as if they were all signed by the Merchant.IN WITNESS WHEREOF the number of original Bills of Lading stated on this side have been signed and wherever one original Bill of Lading has beensurrendered any others shall be void.
BILL OF LADING FOR OCEAN TRANSPORT OR MULTIMODAL TRANSPORT
Notify Party (see clause 22)
' ' VNESHTRANSPORT ' LLC
860298156Shipper
ESSAR STEEL LTD.(PRECOATED FACILITY)GAT NO 740, PUNE NAGAR ROAD,SANASWADI ,INDIA
Booking No.
860348368,860298156
Export references
....Svc Contract
418114
Onward inland routing (Not part of Carriage as defined in clause 1. For account and risk of Merchant)
Consignee (negotiable only if consigned "to order", "to order of" a named Person or "to order of bearer")
OOO 'SEVMETALLSNAB SPBKAMCHATSKAYA STR, 13, A192007, SAINT PETERSBURG,RUSSIA
Vessel (see clause 1 + 19)
MAERSK KALMARVoyage No.
1006Place of Receipt. Applicable only when document used as Multimodal Transport B/L. (see clause 1)
Port of Discharge
Saint Petersburg Port,RussiaPlace of Delivery. Applicable only when document used as Multimodal Transport B/L. (see clause 1)
Saint Petersburg Port,RussiaPort of Loading
Nhava Sheva Port, India
PARTICULARS FURNISHED BY SHIPPERWeight MeasurementKind of Packages; Description of goods; Marks and Numbers; Container No./Seal No.
13 containers said to contain 63 Coil
PRIME PREPAINTED GALVANIZED STEEL COILS TERMS OF DELIVERY : CFR SAINT PETERSBURG PORT, RUSSIA (INCOTERMS 2000) S. BILL NO. 8369523,8373983,8373979,8377863 IEC NO. 0388147831 NET WEIGHT (MT) :341.000 GROSS WEIGHT (MT) :346.110 FINAL DESTINATION:SAINT PETERSBURG PORT, RUSSIA
AGENTS ADDRESS AT PORT OF DISCHARGEZAO MAERSK ST PETERSBURG
346110.00 KGS 260.000 CBM
Above particulars as declared by Shipper, but without responsibility of or representation by Carrier (see clause 14)
Place of Issue of B/L
PuneCarrier's Receipt (see clause 1 and 14). Total number of containers or packages received by Carrier.
13 containersNumber & Sequence of Original B(s)/L Date of Issue of B/L
Declared Value (see clause 7.3)
Signed for the Carrier A.P. Møller - Mærsk A/S trading as Maersk Line
As Agent(s) for the Carrier
B/L: 860298156 Attachment No.: 1/2
Freight & Charges Rate Unit Currency Prepaid Collect
17A, 2ND SOVETSKAYA STREET ZIP: 193036 ST PETERSBURG RUSSIA PHONE: +7 812 7183640FAX: +7 812 7183641
MSKU2076968 ML-IN1930538 20 DRY 8'6 5 Coil 27825.00 KGS 20.000 CBM Shipper Seal : IN1930538PONU0448808 ML-IN1934902 20 DRY 8'6 5 Coil 26290.00 KGS 20.000 CBM Shipper Seal : IN1934902PONU0078051 ML-IN1934261 20 DRY 8'6 5 Coil 26535.00 KGS 20.000 CBM Shipper Seal : IN1934261TEXU2479294 ML-IN1930522 20 DRY 8'6 5 Coil 26695.00 KGS 20.000 CBM Shipper Seal : IN1930522MSKU2789383 ML-IN1934933 20 DRY 8'6 5 Coil 25380.00 KGS 20.000 CBM Shipper Seal : IN1934933MSKU7931649 ML-IN1934950 20 DRY 8'6 5 Coil 26195.00 KGS 20.000 CBM Shipper Seal : 074055MSKU5647377 ML-IN1934940 20 DRY 8'6 4 Coil 26445.00 KGS 20.000 CBM Shipper Seal : IN1934940PONU0095995 ML-IN1934954 20 DRY 8'6 4 Coil 26555.00 KGS 20.000 CBM Shipper Seal : IN1934954POCU0467492 ML-IN1934935 20 DRY 8'6 5 Coil 25950.00 KGS 20.000 CBM Shipper Seal : IN1934935MSKU2127495 ML-IN1934993 20 DRY 8'6 5 Coil 27435.00 KGS 20.000 CBM Shipper Seal : IN1934993TTNU3921162 ML-IN1934916 20 DRY 8'6 5 Coil 26675.00 KGS 20.000 CBM Shipper Seal : IN1934916KNLU3372893 ML-IN1934996 20 DRY 8'6 5 Coil 26230.00 KGS 20.000 CBM Shipper Seal : IN1934996MSKU3527454 ML-IN1934926 20 DRY 8'6 5 Coil 27900.00 KGS 20.000 CBM Shipper Seal : 074054SHIPPER'S LOAD, STOW, WEIGHT AND COUNT
DATE : REF : 30000000**
TO,
SUB : EXPORT DOCUMENTS FOR USD **** UNDER L/C NO FOBEA1M621165000 DATED05.02.2010
WITH REFERENCE TO THE ABOVE WE ENCLOSE HEREWITH THE FOLLOWING DOCUMENTS OF OUR EXPORT TO
ASE METALS WE REQUEST YOU TO NEGOTIATE / DISCOUNT THE SAME UNDER L/C & CREDIT THE PROCEEDS TO
OUR C/C/PACKING CREDIT ACCOUNT UNDER INTIMATION TO US 1. BILL OF EXCHANGE OF DUPLICATE
2.SIGNED COMMERCIAL INVOICE NO. 30000000** DATE 04.05.2010 ORIGINAL AND 4 COPIES
3.CONTAINERWISE PACKING LIST NO. 30000000** DATE 04.05.2010 ORIGINAL AND 2 COPIES
4.BILL OF LADING N0 ****************** DATE 04.05.2010
FULL SET 3/3 ORIGINAL
5.CERTIFICATE OF ORIGIN
ORIGINAL AND 1 COPY
6. MILL TEST CERTIFICATE
ORIGINAL AND 1 COPY
7. BENEFICIARY'S CERTIFICATE STATING THAT COPY OF REQUIRED DOCUMENTS
COURIERED TO ASE METALS AND ITS COURIER RECEIPT
8. DUPLICATE COPY OF THE G.R. DULY ATTESTED FROM THE CUSTOMS
9.ORIGINAL L/C NO FOBEA1M621165000 DATE 05.02.2010
IN ORIGINAL AND ITS AMDT NO. 1 DT.21.04.2010
Please acknowledge the receipt of the same and negotiate the document at the earliest.
Thanking You,
For ESSAR STEEL LTD
(PRECOATED FACILITY )
AUTHORISED SIGNATORY
NB: We also enclose one set of the documents for negotiating Banks record.
363IN363420420510-1
The Officer on Duty,
SR. NO :
Dear Sirs,
DELIVERY ORDER
VIRGO CONTAINER YARDOPAL ASIA DEPOT (I) PVT. LTD.,VIRGO YARD, NH-4B, JASAI,JNP - PANVEL ROAD,NHAVA SHEVA
Please deliver, 26 X 20DV Containers to the transporter or M/s. ESSAR STEEL LTDfor stuffing at their factory premises, planned to be loaded on MSC ANTWERP / 7R, NSICT - NHAVA SHEVA INTL. CONTAINEfor the port of ANTWERP of Final Destination PORTBURY,
HEAVY DUTY CONTAINERS
For
Please ensure that seal numbers are shown against each container on the shipping Bill copy failing which the samewill not be accepted by our stevedores.
MSC AGENCY (INDIA) PRIVATE LIMITED
CC: The Clearing Agents M/s. Tel No: , Broker : DAMANI SHIPPING P LTD
Container
This Delivery order is valid Till 08-MAY-10
SPECIAL INSTRUCTIONS:-
1) PLEASE ENSURE NECESSARY IMCO LABLES WHICH ARE SUPPLIED BY OUR OFFICE ARE DULY AFFIXED ON ALLFOUR SIDES OF THE CONTAINER PRIOR TO RECEIPT AT CY POINT. ANY FINES FOR NON-AFFIXMENT OF IMCO LABLESWILL BE RECOVERED FROM YOURSELVES.2) ALL FACTORY/HOUSE PACKED CONTAINERS MUST BE GIVEN CUSTOMS OUT OF CHARGE AND BROUGHT BACKWITHIN 7 DAYS FROM THE DATE OF PICKUP (INCLUDING SUNDAYS AND HOLIDAYS) FAILING WHICH DETENTIONCHARGES WILL BE RECOVERD AS PER ATTACHED DETENTION TARIFF.3) IF CONTAINER(S) PICKED UP AGAINST THIS BOOKING IS/ARE INTERCHANGED WITH OTHER BOOKING/FOR ANY OTHEROR PORT WITHOUT PRIOR INTIMATION TO MSC OFFICE, PENALTY OF USD 50/TEU WILL BE APPLICABLE FOR SAME4) PLEASE SUBMIT RELEVANT SHIPPING BILL 'OUT OF CHARGE' TO OUR SURVEYORS MASTER MARINE AT DRONAGIRI.5) CARGO NOT TO EXCEED PAYLOAD AS INDICATED ON CONTAINER. CARRIER WILL NOT BE RESPONSIBLE FORSTUFFING CARGO OVER RATED CAPACITY.6) SHIPPER WILL BE RESPONSIBLE FOR ANY CONTAINER DAMAGE IF CAUSED DUE O IMPROPER/ OVERWEIGHTSTUFFING.7) IN CASE OF OPEN TOPS , SHIPPER TO MAKE SURE BEFORE PICK UP THAT ALL REMOVABLE PARTS SUCH ASTARPULIN,TIR CORD, ROOF BOWS ETC.. ARE INTACT.8) PLEASE SUBMIT YOUR PROFORMA B/L WITH FULL ADDRESS, TEL/FAX NO. OF CONSIGNEE AS SOON AS CARGO/CONTAINER IS GIVEN CUSTOMS OUT OF CHARGE. FAILING WHICH LATE DOCUMENTATIONCHARGES RS. 1000/BL WILL BE APPLICABLE.9) FOR DOCK STUFFING WE WILL NOT ACCEPT/STUFF CARGO ABOVE 20MT PER CONTR.10) VERY IMPORTANT - MSC DOES NOT ACCEPT SHIPMENTS WHERE SWITCH B/LS ARE INVOLVED. ANY REQUEST FOR SWITCH B/L AFTER SHIPMENT IS EFFECTED WILL NOT BE ENTERTAINED.11) CONTAINERS WHICH HAVE BEEN FUMIGATED ARE REQUIRED TO BE DECLARED AS HAZARDOUS AND HAZARDOUS CARGO DECLARATION REQUIRES TO BE SUBMITTED.
Thanking you,
(Factory Stuffing)
05-MAY-10Date :
As sub AgentsHind Freight Services Private Limited
S.No. OA NO PORT LINE VESSEL & VOY CUT OFF & TIME DOC. CUT OFF & TIME
1 21/17905 SUPE, BRAZIL MSC MSC LIBERTY/38R 30.05.10/1000 HRS 30.05.10/1200 HRS
2 21/17213 BEIRA, MOZAMBIQUE EMIRATES VIONIA/1017S 01.06.10/1500 HRS 01.06.10/1800 HRS
3 21/15594 CAUCEDO CSAV CSAV APPENNINI / 1021 29.05.0 / 23.59 HRS 28.5.10 /1700 HRS
4 21/18008,18060 LOME,TOGO SAFMARINE MAERSK KITHIRA/1008 29.05.10/2300 HRS 29.05.10/1800 HRS
5 21/17905 MONTEVIDEO MSC MSC LIBERTY/38R 30.05.10/1000 HRS 30.05.10/1200 HRS
6 21/17574 NAPLES HDS TABAN 1/V-1011 31.5.2010 /15.00hrs 31.5.2010 / 17.00hrs
7 21/16927 MERSIN, TURKEY MAERSK NEDLLOYD EUROPA/1010 01.06.10/1800 HRS 01.06.10/1200 HRS
8 21/17571 SUAPE, BRAZIL MSC MSC LIBERTY/38R 30.05.10/1000 HRS 30.05.10/1200 HRS
9 21/17525 SOHAR SAFMARINE NEDLLOYD EUROPA/1010 01.06.10/1800HRS 31.05.10
10 21/18345 VENEZIA MAERSK NEDLLOYD EUROPA/1010 01.06.10/1800 HRS 01.06.10/1200 HRS
11 21/18174 GIOIA TAURO MAERSK NEDLLOYD EUROPA/1010 01.06.10/1800 HRS 01.06.10/1200 HRS
Contd.
Table: Vessel Details
Table: Vessel Details
FREIGHT GATE SAILING REMARK SI CUT OFF & TIME POD TRANSIT TIME
$1,390 NSICT 01.06.10 GATE WILL OPEN ATER 25.05.10
$1,185 JNPT 02.06.10 GATE IS OPEN 31.05.10/1100 HRS BEIRA 21 DAYS
$1,990 NSICT 31.05.10
$1,639 NSICT 31.05.10 GATE WILL OPEN AFTER 24.05.10 29.05.10/1400 HRS TANGER 32 DAYS
$1,480 NSICT 01.06.10 GATE WILL OPEN ATER 25.05.10 ANTWERP 59 DAYS
$1,110 JNPT 01.06.10 GATE WILL OPEN ON 27/05 MORNING JEBEL ALI 30 DAYS
$1,091 NSICT 03.06.10 GATE WILL OPEN AFTER 27.05.10 01.06.10/1200 HRS PORT SAID 24 DAYS
$1,390 NSICT 01.06.10 GATE WILL OPEN ATER 25.05.10
$609 NSICT 31.05.10 GATE WILL OPEN AFTER 24.05.10 29.05.10/1500HS JEBEL ALI 30 DAYS
$939 NSICT 03.06.10 GATE WILL OPEN AFTER 27.05.10 01.06.10/1200 HRS GIOIA TAURO 34 DAYS
$1,089 NSICT 03.06.10 GATE WILL OPEN AFTER 27.05.10 01.06.10/1200 HRS GIOIA TAURO 18 DAYS
X. Glossary of Port and Shipping Terms
Backhaul
To haul a shipment back over part of a
route that it has already traveled; return
movement of cargo, usually opposite from
the direction of its primary cargo
destination.
Ballast keel
A heavy keel fitted to vessels to lower the
center of gravity and improve stability.
Ballast tanks
Compartments at the bottom of a ship that
are filled with liquids for stability and to
make the ship seaworthy.
Beam
The width of a ship.
Berth
A place in which a vessel is moored or
secured; place alongside a quay where a
ship loads or discharges cargo.
Berth term
Shipped under a rate that does not include
the cost of loading or unloading. Berth
dues (or quay dues or dockage) charges for
the use of a berth. Typically assessed based
on the duration of a vessel’s stay and
length overall (LOA).
Bill of lading
A document that establishes the terms of
contract between a shipper and a
transportation company. It serves as a
document of title, a contract of carriage,
and a receipt for goods.
Bond port
Port of a vessel’s initial customs entry to
any country; also known as first port of
call.
Bonded warehouse
A warehouse authorized by customs
authorities for storage of goods on which
payment of duties is deferred until the
goods are removed.
Break bulk
Loose, non-containerized cargo stowed
directly into a ship’s hold.
Broker
A person who arranges for transportation
of loads for a percentage of the revenue
from the load.
Build-operate-transfer (BOT)
A form of concession where a private party
or consortium agrees to finance, construct,
operate and maintain a facility for a
specific period and transfer the facility to
the concerned government or port
authority after the term of the concession.
The ownership of the concession area (port
land) remains with the government or port
authority during the entire concession
period. The concessionaire bears the
commercial risk of operating the facility.
Bulkhead
A structure to resist water; a partition
separating one part of a ship from another
part.
Bulk vessel
All vessels designed to carry bulk cargo
such as grain, fertilizers, ore, and oil.
Bunkers
Fuel used aboard ships.
Cabotage
Shipments between ports of a single nation
frequently reserved to national flag vessels
of that nation.
Cargo tonnage
Ocean freight is frequently billed on the
basis of weight or measurement tons.
Weights tons can be expressed in terms of
short tons of 2,000 pounds, long tons of
2,240 pounds, or metric tons of 1,000
kilograms (2,204.62 pounds).
Measurement tons are usually expressed as
cargo measurements of 40 cubic feet (1.12
cubic meters) or cubic meters (35.3 cubic
feet).
Carrier
Any person or entity who, in a contract of
carriage, undertakes to perform or to
procure the performance of carriage by
sea, inland waterway, rail, road, air, or by a
combination of such modes.
Cartage
Intraport or local hauling of cargo by drays
or trucks (also referred to as drayage).
Chassis
A frame with wheels and container locking
devices to secure the container for
movement.
Classification yard (also commonly
known as a shunting yard)
A railroad yard with many tracks used for
assembling freight trains. Cleaning in
transit the stopping of articles (such as
farm products) for cleaning at a point
between the point of origin and
destination.
Clearance
The size beyond which vessels, cars, or
loads cannot pass through, under, or over
bridges, tunnels, highways, and so forth.
Cleat
A device secured on the floor of a
container to provide additional support or
strength to a cargo-restraining device, or a
device attached to a wharf to secure
mooring lines.
Common carrier
A transportation company that provides
service to the general public at published
rates.
Concession
An arrangement whereby a private party
(concessionaire) leases assets from an
authorized public entity for an extended
period and has responsibility for financing
specified new fixed investments during the
period and for providing specified services
associated with the assets; in return, the
concessionaire receives specified revenues
from the operation of the assets; the assets
revert to the public sector at expiration of
the contract.
Conservancy
In some countries, this fee is levied to
retain upkeep of the approaches to
waterways and canals.
Consolidation
Cargo consisting of shipments of two or
more shippers or suppliers. Container load
shipments may be consolidated for one or
more consignees.
Container
Steel or aluminum frame forming a box in
which cargo can be stowed meeting
International Standard Organization (ISO)-
specified measurements, fitted with special
castings on the corners for securing to
lifting equipment, vessels, chassis,
rail cars, or stacking on other containers.
Containers come in many forms and types,
including: ventilated, insulated,
refrigerated, flat rack, vehicle rack, open
top, bulk liquid, dry bulk, or other special
configurations. Typical containers may be
10 feet, 20 feet, 30 feet, 40 feet, 45 feet, 48
feet, or 53 feet in length, 8 feet or 8.5 feet
in width, and 8.5 feet or 9.5 feet in height.
Container freight station
A dedicated port or container terminal
area, usually consisting of one or more
sheds or warehouses and uncovered
storage areas where cargo is loaded
(“stuffed”) into or unloaded (“stripped”)
from containers and may be temporarily
stored in the sheds or warehouses.
Container pool
An agreement between parties that allows
the efficient use and supply of containers;
a common supply of containers available
to the shipper as required.
Container vessel
Ship equipped with cells into which
containers can be stacked; containerships
may be full or partial, depending on
whether all or only some of its holds are
fitted with container cells.
Container terminal
An area designated for the handling,
storage, and possibly loading or unloading
of cargo into or out of containers, and
where containers can be picked up,
dropped off, maintained, stored, or loaded
or unloaded from one mode of transport to
another (that is, vessel, truck, barge, or
rail).
Container yard
A container handling and storage facility
either within a port or inland.
Contraband
Cargo that is prohibited.
Contract carrier
Any person not a common carrier who,
under special and individual contracts or
agreements, transports passengers or cargo
for compensation.
Controlled atmosphere
Sophisticated, computer controlled systems
that manage the mixture of gases within a
container throughout an intermodal
journey, thereby reducing decay.
Customhouse
A government office where duties are paid,
documents filed, and so forth, on foreign
shipments.
Customs broker
A person or firm, licensed by the customs
authority of their country when required,
engaged in entering and clearing goods
through customs for a client (importer).
Cut-off time (closing time)
The latest time a container may be
delivered to a terminal for loading to a
scheduled barge, vessel, train, or truck.
Daily running cost
Cost per day of operating a ship.
Deconsolidation point
Place where cargo is ungrouped for
delivery.
Demurrage
A penalty charge against shippers or
consignees for delaying the carrier’s
equipment beyond the allowed free time.
The free time and demurrage
charges are set forth in the charter party or
freight tariff.
Dock or quay
A structure attached to land to which a
vessel is moored.
Draft (or draught)
The depth of a ship while in the water.
Measured as the vertical distance between
the waterline and the lowest edge of the
keel.
Dredging
Removal of sediment to deepen access
channels, provide turning basins for ships,
and maintain adequate water depth along
waterside facilities.
Dry bulk
Loose, mostly uniform cargo, such as
agribulk products, coal, fertilizer, and ores
that are transported in bulk carriers.
Dunn age
Material used in stowing cargo either for
separation or the prevention of damage.
Electronic data interchange (EDI)
Transmission of transactional data between
computer systems.
EDIFACT
Electronic Data Interchange for
Administration, Commerce, and Trade.
International data interchange
standards sponsored by the United
Nations.
Eminent domain
The sovereign power to take property for a
necessary public use, with reasonable
compensation.
Feeder service
Transport service whereby loaded or
empty containers in a regional area are
transferred to a “mother ship” for a long-
haul ocean voyage.
Fixed costs
Costs that do not vary with the level of
activity. Some fixed costs continue even if
no cargo is carried; for example, terminal
leases, rent, and property taxes.
Force majeure
The title of a common clause in contracts,
exempting the parties from no fulfillment
of their obligations as a result of conditions
beyond their control, such as earthquakes,
floods, or war.
Foreign trade zone
A free port in a country divorced from
customs authority, but under government
control. Merchandise, except contraband,
may be stored in the zone without being
subject to import duty regulations.
Forty-foot equivalent unit (FEU)
Unit of measurement equivalent to one
forty-foot container. Two twenty-foot
containers (TEUs) equal one FEU.
Free trade zone
A zone, often within a port (but not
always), designated by the government of
a country for duty-free entry of any
nonprohibited goods. Merchandise may be
stored, displayed, or used for
manufacturing within the zone and re
exported without duties being applied.
Also referred to as free port.
Freight, demurrage, and defense
Class of insurance provided by a protection
and indemnity (P&I) club that covers legal
costs incurred by a shipowner in
connection with claims arising from the
operation of the ship.
Freight forwarder
Person or company who arranges for the
carriage of goods and associated
formalities on behalf of a shipper. The
duties of a forwarder include booking
space on a ship, providing all the necessary
documentation, and arranging customs
clearance.
Freight payable at destination
Method of paying the freight often used for
shipment of bulk cargo, the weight of
which is established on discharge from the
ship.
Gantry crane
A crane fixed on a frame or structure
spanning an intervening space typically
designed to traverse fixed structures such
as cargo (container) storage areas or quays
and which is used to hoist containers or
other cargo in and out of vessels and place
or lift from a vessel, barge, trucks, chassis,
or train.
Gateway
A point at which freight moving from one
territory to another is interchanged
between transportation lines.
Good international practice
Term used in contracts, meaning the
exercise of that degree of skill, diligence,
and prudence that would, in order to satisfy
internationally accepted standards of
performance, reasonably be practiced by
an experienced person holding all
applicable qualifications who is engaged in
the same type or similar types of activity
under the same or similar circumstances.
Grounding
Contact by a ship with the ground while
the ship is moored or anchored as a result
of the water level dropping, or when
approaching the coast as a result of a
navigational error.
Groupage
The grouping together of several
compatible consignments into a full
container load. Also referred to as
consolidation.
Harbor dues (or port dues)
Charges by a port authority to a vessel for
each harbor entry, usually on a per gross
tonnage basis, to cover the costs of basic
port infrastructure and marine facilities
such as buoys, beacons, and vessel traffic
management system.
Hand-over
Term used in contracts, meaning the
process of providing exclusive,
unencumbered, peaceful, and vacant
possession of and access to a concession
area and the existing operational port
infrastructure and also all rights, title (free
of all encumbrances and security), and
interest in all the movable assets and all the
facilities by the government or the port
authority on the hand-over date for the
conduct of terminal operations.
Harbormaster
An officer who is in charge of vessel
movements, safety, security, and
environmental issues within a port.
Heavy lift charge
A charge typically imposed when special
lifting gear is required to handle a given
piece of cargo, which may be of either
heavy weight or of large dimensions (often
referred to as “out of gauge” when dealing
with container vessels).
Hold
A ship’s interior storage compartment.
In bond
Cargo moving under customs control
where duty has not yet been paid.
Inducement
Placing a port on a vessel’s itinerary
because the volume of cargo offered by
that port justifies the cost of routing the
vessel.
Inland carrier
A transportation company that hauls export
or import traffic between ports and inland
points.
Intermodal
Movement of cargo containers
interchangeably between transport modes
where the equipment is compatible within
the multiple systems.
Jetty (or pier)
A structure that is perpendicular or at an
angle to the shoreline to which a vessel is
secured for the purpose of loading and
unloading cargo.
Jumboising
Conversion of a ship to increase cargo-
carrying capacity by dividing and adding a
new section.
Keel
A flat steel plate running along the center
line of a vessel.
Knot
Measure of ship speed, equal to one
nautical mile (1,852 meters) per hour.
LASH
Abbreviation for “lighter aboard ship.” A
specially constructed vessel equipped with
an overhead traveling gantry crane for
lifting specially designed barges out of the
water and stowing them into the cellular
holds of the vessel (loading) and
unstowing (unloading) as well.
Loaded draught (or draft)
Depth of water to which a ship is
immersed when fully loaded.
Landlord port
An institutional structure where the port
authority or other relevant public agency
retains ownership of the port land and
responsibility for port planning and
development, as well as the maintenance
of basic port infrastructure and aids to
navigation.
Lender’s direct agreement
Agreement between parties to a concession
or BOT agreement (government or port
authority and special purpose vehicle
[SPV] or terminal operator) and the lenders
(usually banks or a consortium of banks)
setting out the rights and obligations of the
lenders in relation to the government or
port authority regarding the facilitation of
the financing of a port project. The
lender’s direct agreement is used in the
event of a proposed termination of the
concession agreement to induce the lenders
to provide the debt to the SPV or operator
under the financing documents. These
rights and obligations usually comprise
assignment rights with respect to the
concession and the site lease agreement,
priority rights with respect to of repayment
of the debt, and step-in rights in case of
termination as a result of breach of
contract by the SPV or operator.
Lighter
An open or covered barge towed or pushed
by a tugboat or a pusher tug and used
primarily in harbors and on inland
waterways to carry cargo to or from the
port.
Limited recourse financing
Project financing in which sponsors or
government agree to provide contingent
financial support to give lenders extra
comfort; typically provided during the
construction and start-up period of a
project, which is generally the riskiest time
in the life of an infrastructure project.
Line haul
The movement of freight over the tracks of
a transportation line from one location
(port or city) to another.
Liner
A vessel sailing between specified ports on
a regular basis.
Lloyds’ Registry
An organization engaged in the surveying
and classing of ships so that insurance
underwriters and others may know the
quality and condition of the vessels
involved.
Longshoreman (or docker, port worker,
or dock worker)
Individual employed locally in a port to
load and unload ships.
Lo-lo (lift-on lift-off)
Cargo handling method by which vessels
are loaded or unloaded by either ship or
shore cranes.
Malacca-max
Maximum size of container and bulk
vessels (in terms of draught) that can cross
the Malacca Straits. The Malacca-max
reference is believed to be today the
absolute maximum possible size for future
container vessels (approximately 18,000
TEU).
Main port
A large multipurpose port serving a
number of countries and regions.
Management contract
An arrangement whereby the operation and
management of a facility is contracted by
the public authority to a specialized
operator for a specified period and under
specified conditions relating to
performance criteria, economic incentives,
and maintenance and infrastructure
commitments. The public authority retains
ownership of the facility and the
commercial risk associated with its
operation.
Mezzanine financing
A mix of financing instruments, including
equity, subordinated debt, completion
guarantees, and bridge financing, the
balance of which changes as the risk
profile of a project changes (that is, as a
project moves beyond construction into
operation).
Mixed cargo
Two or more products carried on board
one ship.
Mobile crane
General purpose crane capable of moving
on its own wheels from one part of a port
to another.
Moor
To attach a ship to the shore by ropes.
Neobulk cargo
Non-, or economically not feasible,
containerizable cargo such as timber, steel,
and vehicles.
Nonrecourse financing
Project financing for which no loan the
sponsors or governments to lenders for the
project provide guarantees or financial
support.
Non-vessel operating common carrier
(NVOCC)
A cargo consolidator in ocean trades who
buys space from a carrier and resells it to
smaller shippers. The NVOCC issues bills
of lading, publishes tariffs, and otherwise
conducts itself as an ocean common
carrier, except that it does not provide the
actual ocean or intermodal service.
On-carrier
Person or company who contracts to
transport cargo from the port or place of
discharge of a sea-going or ocean-going
ship to another destination by a different
means of transport, such as a feeder vessel,
truck, train, or barge.
Optional cargo
Cargo that is destined for one of the ship’s
discharge ports, the exact one not being
known when the goods are loaded.
Over carriage
The carriage of cargo beyond the port for
which it was intended.
Pallet
A flat tray, generally made of wood, but
occasionally steel or other materials, on
which goods can be stacked. There are two
principal sizes: the ISO pallet, which
measures 1 x 1.2 meters, and the europallet
at 0.8 x 1.2 meters.
Panamax
Maximum beam that allows vessels to pass
through the locks of the Panama Canal
(specifically used for dry bulk and
container vessels).
Permanent dunnage
Strips of timber fixed to the frames of a
ship to keep cargo away from the sides of
the ship to avoid damage and
condensation.
Pilferage
Stealing of cargo.
Pilotage
The act of assisting the master of a ship in
navigation when entering or leaving a port
or in confined water.
Pilotage dues
Fee payable by the owner or operator of a
ship for the services of a pilot; the fee is
normally based on the ship’s tonnage,
draft, or length.
Platform (or flat)
A shipping container without sides, ends,
or a roof. Normally 20 or 40 feet long, it is
used for awkwardly shaped cargo that
cannot fit on or in any other type of
container.
Plimsoll mark/load lines
A series of horizontal lines and a circle
with a horizontal line painted amidships of
both sides of the hull of a ship marking the
level that must remain above the surface of
the water for the vessel’s stability.
Pontoon
Flat-bottomed floating structure with a
shallow draught.
Pooling
Sharing of cargo or the profit or loss
from freight by member lines of a liner
conference.
Port dues (or harbor dues)
Charges levied against a ship owner or
ship operator by a port authority for the use
of a port (see also harbor dues).
Port of refuge
Port, not on a ship’s itinerary, which the
ship calls at due to some unforeseen hazard
at sea and where the ship may undergo
repairs, refuel,
or rescue cargo.
Port of registry
Place where a ship is registered with the
authorities, thereby establishing its
nationality.
Pre entry
Presentation to the customs authorities of
export or import declarations prior to the
clearance of goods.
Project financing
Financing wherein the lender looks to a
project’s cash flows to repay the principal
and interest on debt, and to a project’s
assets for security; also known as
“structured financing” because it requires
structuring the debt and equity such that a
project’s cash flows are adequate to service
the debt.lossary
Rail-mounted gantry (RMG) or rail
mounted container gantry crane
Rail-mounted gantry crane used for
container acceptance, delivery, and
stacking operations in a container yard.
Reefer
Refrigerated container or vessel designed
to transport refrigerated or frozen cargo.
Relay
To transfer containers from one ship to
another.
Ro/ro
A shortening of the term “roll-on roll-off.”
Ro/ro is a cargo handling method whereby
vessels are loaded via one or more ramps
that are lowered on the quay.
Rubber-tired gantry (RTG) or rubber
tired container gantry crane
Gantry crane on rubber tires typically used
for acceptance, delivery, and container
stacking at a
container yard.
Shed (also see warehouse)
Covered area for the reception, delivery,
consolidation, distribution, and storage of
cargo.
Note: A warehouse usually points at
longer-term storage, whereas a shed
usually is used for shorter-term storage.
Ship chandler
An individual or company selling
equipment and supplies for ships.
Ship’s tackle
All rigging and so forth used on a ship to
load or unload cargo.
Side loader
A lift truck fitted with lifting attachments
operating to one side for handling
containers.
Spotting
Placing a container where required to be
loaded or unloaded.
Spreader
A piece of equipment designed to lift
containers by their corner castings.
Stack car
An articulated multiple platform rail car
that allows containers to be double
stacked.
Stack train
A rail service whereby rail cars carry
containers stacked two high on specially
operated unit trains.
Stevedore
Individual or firm that employs
longshoremen (or dockers, dock workers,
or port workers) to load and unload
vessels.
Stevedoring charges
Fees for loading and stowing or unloading
a ship.
Sto-ro
A vessel with capacity for break-bulk
cargo as well as vehicles or trailer borne
cargo.
Stowage factor
The average cubic space occupied by one
ton weight of cargo as stowed aboard a
ship.
Straddle carrier
Type of equipment that picks up and
transports containers between its legs for
movement within a container terminal.
Stripping (unstuffing)
Unloading of a container.
Supply chain
A logistics management system that
integrates the sequence of activities from
delivery of raw materials to the
manufacturer through to the delivery of the
finished product to the customer in
measurable components.
Tare weight
The weight of wrapping or packing; added
to the net weight of cargo to determine its
gross weight.
Terminal charge
A charge made for a service performed in a
terminal area typically referring to
handling associated with receipt, delivery,
or inspection of cargo via land-based
operations.
Throughput charge
The charge for moving a container through
a container yard off of or onto a ship.
Top off
To fill a ship that is already partly loaded
with cargo. Typically occurs where there is
a draught restriction at the first load port—
the ship loads
a quantity of cargo corresponding to the
permissive draught, then fills up at the
second port where there is no restriction.
Top stow cargo
Goods that are stowed on top of all others
in a ship’s hold because of their relatively
low density and the probability that they
would be damaged if over stowed.
Top lifter
Forklift truck capable of lifting a container
by means of its spreader.
Towage
Charges for the services of tugs assisting a
ship or other vessels in ports.
Tramp line
An ocean carrier company operating
vessels on other than regular routes and
schedules.
Transshipment
A distribution method whereby containers
or cargo are transferred from one vessel to
another to reach their final destination,
compared to a
direct service from the load port of origin
to the discharge port of destination. This
method is often used to gain better vessel
utilization and thereby economies of scale
by consolidating cargo onto larger vessels
while transiting in the direction of main
trade routes.
Transshipment port
A port where cargo is transferred from one
carrier to another or from one vessel of a
carrier to another vessel of the same carrier
without the cargo leaving the port.
Turnaround time
The time it takes between the arrival of a
vessel and its departure from port;
frequently used as a measure of port
efficiency.
Twenty-foot equivalent unit (TEU)
Container size standard of twenty feet.
Two twenty-foot containers (TEUs) equal
one FEU. Container vessel capacity and
port throughput
capacity are frequently referred to in
TEUs.
Unitization
The consolidation of a quantity of
individual items into one large shipping
unit for easier and faster handling through
methods such as palletizing, stripping,
slinging and containerization.
Unloader
Port equipment employed to unload ships
carrying dry bulk cargo.
Unmoor
To remove the ropes that attach a ship to
the shore.
Unstuffing (or stripping)
Unloading of a container.
Variable cost
Costs that vary directly with the level of
activity within a short time. Examples
include costs of moving cargo inland on
trains or trucks, stevedoring in some ports,
and short-term equipment leases.
Vessel manifest
Declarations made by international ocean
carriers relating to the ship’s crew and
contents at both the port of departure and
arrival. All bills of lading are registered on
the manifest.
Vessel traffic management system
Vessel control and management system
(VTMS) usually under the authority of the
harbormaster, comprising equipment (such
as radars, tracking software, and radio
communications), personnel (traffic
operators), and regulations. Most larger
maritime ports have relatively advanced
vessel traffic management systems for
maritime safety, protection of the
environment, and coordination of marine
services.
Warehouse (see also shed)
Covered area for the reception, delivery,
consolidation, distribution, and storage of
cargo. Note: A warehouse usually points at
longer-term storage, whereas a shed
usually is used for shorter-term storage.
Waybill
Document, issued by a shipping line to a
shipper,
which serves as a receipt for the goods and
evidence of the contract of carriage.
Wharf
Structure built alongside the water or
perpendicular to the shore where ships
berth for loading or discharging goods.
Wharfage
The charge that an owner of a facility
(terminal or port) charges for the
movement of cargo through that facility.
