Interested in transshipment trade, inquiring whether it requires customs clearance and the differences compared to general trade customs clearance. The best answer states that transshipment trade goods need to pass through customs, requiring customs procedures in the transit country, including declaration, submission of documents, and inspection, which are basically similar to general trade, but document requirements may be more complex. It is advisable to understand the customs regulations of the transit country before engaging in transshipment trade.
What Exactly Are Transshipment Logistics and Transshipment Trade? Please Explain!
Resolved
I've been researching international trade knowledge recently and keep encountering the terms transshipment logistics and transshipment trade, which are a bit confusing. I'd like to ask everyone, what are transshipment logistics and transshipment trade? What are their connections and differences? Could you explain them in simple terms, preferably with some practical examples, so I can understand them better?
Trade Expert Insights Answers
Transshipment trade refers to international trade where the buying and selling of import and export goods are not conducted directly between the producing country and the consuming country, but rather through a third country. For example, Country A produces a certain product, and Country C needs this product, but there are issues like trade barriers between Country A and Country C. Therefore, Country A first sells the goods to Country B, and then Country B resells them to Country C. The trade conducted by Country B is transshipment trade.
Transshipment logistics are the logistics activities that serve transshipment trade, responsible for the transportation, warehousing, loading, and unloading of goods in the third country. In the example above, the goods are transported from Country A to Country B, stored in Country B, and then transshipped to Country C. This series of logistics operations constitutes transshipment logistics. Transshipment trade focuses on the trade transaction level, while transshipment logistics focus on cargo transportation and related logistics links. The two are interdependent: transshipment trade is the prerequisite for the existence of transshipment logistics, and transshipment logistics ensure the realization of transshipment trade.
Simply put, transshipment trade is the sale of goods through a third party, and transshipment logistics is the transportation and storage of goods to facilitate this resale process. For instance, when some European and American countries have restrictions on certain Chinese products, Chinese enterprises engage in transshipment trade through places like Hong Kong. Hong Kong logistics companies then assist with transshipment logistics by arranging the onward transport of the goods.
Transshipment trade can circumvent trade restrictions and tariff differences. For example, if two countries have high tariffs, goods can be resold through a third country with lower tariffs. Transshipment logistics must ensure the safe and timely transportation of goods, such as arranging suitable cargo ships and proper warehousing at the transit point.
Transshipment trade involves the transfer of ownership of goods, while transshipment logistics focuses on the physical movement of goods. For example, a Chinese company selling goods to a Singaporean intermediary is transshipment trade; the Singaporean intermediary arranging for the goods to be shipped from China to India is the transshipment logistics for this process.
In transshipment trade, the third country generally acts as a trade hub, leveraging its advantages to facilitate trade. Transshipment logistics, on the other hand, requires careful planning of routes, warehousing, etc. For instance, some free trade ports have active transshipment trade and well-developed transshipment logistics.
From a profit model perspective, transshipment trade profits from the price difference in the buying and selling of goods, while transshipment logistics profits from charging for logistics services. For example, transshipment traders buy low and sell high, while logistics companies charge fees for transportation and warehousing.
Transshipment trade requires consideration of market and policy factors, while transshipment logistics must consider transportation costs and cargo safety. For example, traders need to study the tariff policies of various countries, and logistics providers need to consider the impact of weather on goods during transit.
The operational process of transshipment trade involves signing contracts, fund flows, etc., while transshipment logistics involves booking space, customs declaration, etc. For instance, traders sign contracts with upstream and downstream parties, and logistics providers are responsible for booking ships and handling customs clearance procedures.
Transshipment trade can carry risks due to policy changes, while transshipment logistics may face risks of transportation damage or delays. For example, a sudden increase in tariffs by a country can affect transshipment trade, and shipping schedule delays can impact transshipment logistics.