Freight transport has become focused on containerization, although bulk transport is used for large volumes of durable items. Transport plays an important part in economic growth and globalization
Freight transport, or shipping, is a key in the value chain in manufacturing. With increased specialization and globalization, production is being located further away from consumption, rapidly increasing the demand for transport. While all modes of transport are used for cargo transport, there is high differentiation between the nature of the cargo transport, in which mode is chosen. Logistics refers to the entire process of transferring products from producer to consumer, including storage, transport, transshipment, warehousing, material-handling and packaging, with associated exchange of information. Incoterm deals with the handling of payment and responsibility of risk during transport.
Containerization, with the standardization of ISO containers on all vehicles and at all ports, has revolutionized international and domestic trade, offering huge reduction in transshipment costs. Traditionally, all cargo had to be manually loaded and unloaded into the haul of any ship or car; containerization allows for automated handling and transfer between modes, and the standardized sizes allow for gains in economy of scale in vehicle operation. This has been one of the key driving factors in international trade and globalization since the 1950s.
Bulk transport is common with cargo that can be handled roughly without deterioration; typical examples are ore, coal, cereals and petroleum. Because of the uniformity of the product, mechanical handling can allow enormous quantities to be handled quickly and efficiently. The low value of the cargo combined with high