What Is Drayage Charge in Trade?

Drayage charge is a term that often evokes confused looks from people in the field of logistics. Indeed, it is often replaced by words such as inland freight, inland transport, etc. by users. So let's see what drayage is in the field of shipping.

What is Drayage and Drayage Fee?

Drayage is an important step in the transport of containers by intermodal freight. Drayage means the overland transport of goods over a short distance. It is used for the movement over short distances of goods whose main leg of the journey is land or sea. It is a specialized area in a supply chain that typically involves the movement of containers.

Drayage is a necessity for the smooth movement of the cargo container from the point of its origin to the destination. Fees charged for transporting containers short distances overland are also known as drayage. These charges are usually not part of the primary carrier's freight bill and are billed separately by the drayage company assigned to the task.

Examples of drayage are when a container needs to be moved from a railcar to a trucking center or shipping terminal or vice versa. It could also mean moving a container from one seaport to another overland. Drayage operators move shipping containers between rail terminals, seaports, or warehouses. It would also involve supporting containers from ships or rail cars onto trucks or vice versa. It can then be moved to a warehouse or transported directly to its final destination. In simple terms, drayage is short-distance land transport of a container.

Dray

If drayage is the overland transport of containers over short distances, what is dray? The origin of the word dray comes from small horse-drawn carts with no side walls that were used to transport heavy boxes between warehouses, railway terminals, seaports, and loading and unloading points along the canals.

Although hunting horses could pull heavy containers, they could not travel very far with this heavy load. Dray carts and horses were used from the 1500s to the early 1900s until the automotive industry took over and trucks were used to haul containers. Nowadays, powerful diesel-powered drayage trucks are used to transport goods over short distances.

Drayage and Trucking

However, drayage should not be confused with trucking. While drayage is the transport of entire containers, trucking generally involves bulk goods, such as the contents of a container or individual units. Drayage using intermodal containers is an important part of the drayage industry. Containers that are transported by drayage generally continue their journey using a different mode of transport which may be a seagoing ship or a freight train. 

Once the final unloading seaport or rail terminal is reached, there will be another drayage before the container reaches its final destination which could be the customer's warehouse. As can be seen, drayage connects the transport of containers by road, rail, or sea.

Classification of Drayage

Drayage can be classified according to the services it links. Each classification is different and only suitable for certain types of container movement. Ultimately, it is up to the shipper to decide which type of drayage is best for transporting their cargo.

Inter-carrier drayage

When a container is transported between a trucking station, rail terminal, or seaport operated by different carriers, it is called inter-carrier drayage.

Intra-carrier drayage

In intra-carrier drayage, a container is transported between different freight terminals belonging to the same company. An example is the transfer of a container from a container station to a railway terminal or a marine terminal belonging to a single company.

Drayage pier

Dock drayage is specific to container transport between rail terminals and seaports.

Door-to-door drayage

When a container is delivered from the seller's warehouse directly to the customer's door, it is called door-to-door drayage.

Accelerated drayage

This type of drayage allows the rapid transfer of goods by land to meet urgent delivery deadlines.

Drayage shuttle

Shuttle drayage is useful in overcoming problems associated with congestion at terminals or transportation hubs. It uses temporary storage spaces such as parking lots, etc. to park the container truck until the space problem is solved.

Specialized Drayage

Cargo is available in various sizes, shapes, and temperature requirements. Some of them might be temperature-sensitive cargoes that need to be packed in refrigerated containers. Some of them may be out of gauge or OOG cargo. These are goods that generally do not fit in a container or box.

While general cargo can be packed inside a general purpose container (GP container), others require special equipment such as a flat rack, open top, premium container, or container refrigerated. Drayage operators must be prepared to meet these requirements and must have the equipment with them. Although it does not strictly fall under the drayage classification, some industries require specialized collection trucks for their pick-ups and deliveries.

One such example is the beer industry which requires transporting heavy kegs of beer between the brewery and retail outlets. To do this, they use forklifts with low frames and a truck with side openings. This facilitates loading and unloading directly at the exit. Barrel ropes or ratchet straps are used to lower heavy barrels onto barrel pads which are large, tough, shock-absorbing pads.

Cold Chain and Drayage

A cold chain is the storage, transport, and distribution of temperature-sensitive goods. Certain food products, meat, fish, pharmaceutical drugs, etc. are examples of products that require the cold chain. Modern refrigerated containers called reefers are used to transport these products from one point to another. Before the reefer container came into the picture, goods that needed to be kept cold were transported on blocks of ice kept inside the trucks. Another alternative available to shippers was then to wait for the cold season to transport these goods!

Drayage plays an important role in cold chain logistics. It is essential that the cold chain is uninterrupted at all times during the transfer of cargo from the shipper's warehouse to its final destination. Drayage overcomes long waiting times that can have a negative impact on the cold chain.