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Breakbulk April 2019

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10 The Journal of Commerce | April 2019 www.joc.com Cover Story Breakbulk & Project Cargo tons, something other than an MPV/ HL might make sense, in Runfola's opinion. But when the shipment under believes. "We are just a small piece of the puzzle in the shipping world. If we don't have relationships with a few carriers and freight forwarders, then we won't do very well, because we won't have any leverage. The thing is keeping the carriers and freight forwarders honest. It's important to never put your faith in one carrier and one freight forwarder. They (need to) know that we have options." When the shipment volume is less than 3,000 freight tons and/or the largest piece doesn't exceed 50 metric Containerization has been seducing traditional breakbulk cargo for years. It's easy to understand why. Strict schedules, predictable routes and prices, and commoditized handling vastly simplify shipping. Once you head into project territory, however, it all gets a lot more complex. For Maersk, the value in creating a breakbulk offering lies in the mass of cargo that ordinarily supports a given project, said Karen Hicks, global client manager. Oil and gas, solar, infrastructure, and other types of projects call for large amounts of materials to be moved in dry containers along with the breakbulk components. "By accepting the breakbulk … that gives us the opportunity to carry the entire project," she said. Breakbulk or project cargo is assessed case by case, depending on the vessels in rotation, space available, length and width of the cargo piece, terminals to be called, and other parameters. Maersk categorizes "special" cargo into three segments: in-gauge, out- of-gauge (OOG) and true breakbulk. In-gauge is loaded into open-top or flat racks but is not over-dimensional and is treated and stowed like dry containers. Typical examples would be pipes or some types of glass, said Kalli Pahountis, special cargo trade manager for the Americas. OOG is also transported on open-top or flat racks but is over-height, over-length and/or overweight. Then there's "true" breakbulk: cargo too heavy, too long, or too tall to be unitized on a single flat rack. OOG and true breakbulk "usually involve more work on the front end to ensure the terminals can execute the lis. We'll use special gear, extra labor, and oversee operations," Hicks said. "There are no cut and dried solutions." Breakbulk weight limits are dependent on the li capacities of the cranes available at the terminals at each end of the voyage. The maximum payload on a single flat rack is about 44 metric tons, but this depends on how the cargo is lashed, as well as on shape and size. Heavier pieces can be loaded as breakbulk across several flat racks, Hicks said. Terminal capabilities are a crucial part of the equation. Typical container cranes li an average maximum of about 65 metric tons, but some can handle 100 metric tons or more, and if floating or mobile cranes are available, heavier cargoes can be loaded and stowed across a bed of flat racks, Hicks said. Again, vessel planning, teamwork, labor, and all related elements must be carefully coordinated. In her experience, Hicks said, true breakbulk cargo tends to be loaded and lashed on a bed of flat racks on the first tier under the hatch covers, but this depends on the vessel. "We always let the customer know, and we are as transparent as possible" about cargo placement and exposure to the elements, she said. Maersk prices breakbulk "dynamically," Pahountis said, based on opportunity and potential, as with dry containers. Standard OOG rates are valid for 30 days, but if cargo for a larger project is going to last four months, for example, negotiations could be for longer periods. "It's definitely a normal occurrence to offer rate extensions on a case-by-case basis, depending on the size of the opportunity," she said. Maersk is creating special project cargo teams and online booking tools, Pahountis said. "We are the only ones that offer standard, OOG, and breakbulk quotes (online) … We are investing in IT and in the technical side, and bringing on human resources and investing in special cargo customer service." ― Janet Nodar Boxing up breakbulk "By accepting the breakbulk … that gives us the opportunity to carry the entire project." Karen Hicks Global Client Manager, Maersk Kalli Pahountis Special Cargo Trade Manager, Americas, Maersk discussion is 18,000 freight tons to 20,000 freight tons, or pieces exceed 50 metric tons and/or require tandem (two-crane) lifts, or if (the shipment) calls for chartering an entire vessel, "then the relationship with the carrier is extremely beneficial and important to the overall success of the shipment. The impact could be catastrophic to a project if it's not done right," Runfola said. l email: janet.nodar@ihsmarkit.com twitter: @janet_nodar "If we don't have relationships with a few carriers and freight forwarders, then we won't do very well, because we won't have any leverage."

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