Browse > Article

Optimizing Total Transport Cost Incurred under Specific Port System: With a Case of Managing POSCO-owned Berths  

Kim, Weon-Jae (인천대학교 무역학부)
Publication Information
Journal of Korea Port Economic Association / v.26, no.3, 2010 , pp. 42-55 More about this Journal
Abstract
This paper primarily deals with a decision-making for determining the number of voyages in each ship size under a specific port structure in order to minimize the total transport cost consisting of transport cost at sea, queuing cost in port, and inventory cost in yard. As a result of computer simulation using queuing model characterized by inter-arrival time distribution, we were able to find out some combination of voyage numbers of 3 ship-size(50,000-ton, 100,000-ton, and 200,000-ton), where the total transport cost can be minimized under a specific port structure. The simulation model also allows us to figure out any trade-off relationship among sea transport cost, queuing cost in port, and inventory cost in yard. Put it differently, an attempt to reduce the sea transport cost by increasing the number of voyages of the largest ship size, the transport cost incurred in both port and yard is hypothesized to be increased and vice versa. Consequently, Port managers are required to adjust the number of annual number of voyages allocated in each ship size, put into the sea lines for importing raw materials, in order to optimize the transport costs incurred under the specific port system. We may consider a net present value(NPV) model for performing an economic feasibility analysis on port investment project. If a total discounted net benefit, including cost savings, exceeds the initial investment for an additional berth construction, then we accept the port investment project. Otherwise, we reject the proposed port investment plan.
Keywords
specific port structure; sea transport cost; queuing cost; inventory cost;
Citations & Related Records
연도 인용수 순위
  • Reference
1 Lim, A., The berth planning problem, Operation Research Letters, 22:pp.105-110,1998   DOI   ScienceOn
2 Taha, H.A., Operations Research, Macmillan Publishing Co., New York, USA,1982
3 Tersine R. J., Principles of Inventory and Materials Management 4th ed., Prentice-Hall, NewJersey, USA,1994
4 Park, Y.M. and Kim, K.H., Ascheduling method for berth and quaycranes, ORS pectrum,25:pp.1-23,2003
5 Plossl G. W., Production and Inventory Control, Prentice-Hall, New Jersey, USA,1985
6 Rushton A., Croucher, P., and Baker, P., Logistics and Distribution Management, Kogan Page, London, UK, 2006
7 Stopford, M., Maritime Economics 2nd ed., Routledge, London, UK,1997
8 Langevin, A. and Riopel, D., GERAD, Logistics Systems: Design and Optimization, Springer Science+Business Media, New York, USA,2005
9 Stroh M.B., A Practical Guide to Transportation and Logistics 3rd ed., Logistics Network, Dumont, New Jersey,2006
10 Miyashita, K., Structural Changesin the Freight Level Determination of Tramper Markets, Maritime Policy and Management 11(1):pp.62-66
11 Langford, ,J.W., Logistics: Principles and Applications, McGrw-Hill, New York, USA,1995
12 Imai, A. Nishimura, E., and Papadimitrius, S., Berthallocation with service priority, Transportation Research B,37:pp.437-457,2003   DOI   ScienceOn
13 Kleinrock, L., Queuing Systems, Vol.I. Theory, John Willey and Sons, New York, USA,1975
14 Frankel,E.G., Port Planningand Development, John Willey and Sons, New York, USA,1987
15 Gilman, S., The Choice of Ship Sizeon Deep Sea General Cargo Routes, Maritime Studies and Management 3:pp.95-103,1975   DOI
16 Brown, G.G., Lawphongpanich, S., and Thurman, K.P., Optimizingshipberthing, Naval Research Logistics,41:pp.1-15,1994   DOI   ScienceOn
17 Daganzo, C. F., Logistics Systems Analysis 4thed., Springer-Verlag, Berlin, Germany,2005