About transportation and foreign trade


series of commercial transactions



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ABOUT TRANSPORTATION AND FOREIGN TRADE

series of commercial transactionsbetween trade partners that tracks the value of what is being traded as well as the types of goods (such as standard international trade classification). Its extent, either in value or volume, is an abstract expression of the quantity of goods being exchanged as they do not represent the actual physical flows supporting trade.
The physical realization of international trade requires a transport chain. It is a series of logistical activities that organize modes and terminals, such as railway, maritime and road transportation systems, and thus the continuity along the supply chain through a set of stages, the most common being:

  • The first stage in the transport chain is composition where loads are assembled at the origin, often on pallets and/or containers. Composition is an important process as it tries to achieve economies of scale over a transport chain by providing larger and easier to handle load units necessary for international trade.

  • The cargo being traded then moves along the transport chain using a transport mode, commonly rail or road to reach a terminal where it istransshipped on an international transport mode (port or airport depending on the nature of what is being transported). Additional economies of scale become possible as several load units can be consolidated into a single large shipment, such as a loaded containership.

  • Once cargo enters another country through a gateway (point of entry) customs inspection takes place as the cargo is transshipped over the inland transport system. Customs procedures and delays are among the most constraining factors in global freight distribution.

  • The final stage of the transport chain, decomposition (the last mile), takes place in the proximity of the final destination. Loads are broken down into units corresponding to effective demand, such as store orders. If the demand concerns retail goods, urban freight distribution strategies may be required.

In the operational reality of modes and terminals, international trade is a series of 
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