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Introduction
In recent decades, the transport-mode choice for the haulage of bulk cargo has gradually changed from bulk carriers to container vessels. For example, container vessels hauled 11.7 per cent of US trade in 1990 (tonnage-based), and that figure increased to 19.5 per cent in 2005 (Wilson and Benson, 2009). This change is mainly owing to the worldwide shift of bulk cargo to container vessels, in what is known as 'bulk cargo containerization'. The change in the freight rates of bulk carriers and container vessels has been one of the factors to potentially contribute to this phenomenon. In the mid-2000s, Baltic Dry Index (BDI) - one of the most well-known indicators of freight rates for bulk carriers - dramatically increased, owing to an expansion in the gap between the supply and demand of bulk carriers, even as the freight rates for container vessels remained relatively stable. As a result, a relative advantage of container-vessel haulage has emerged, and shippers have consequently shifted to container vessels when hauling bulk cargo.
With regard to the factors that determine the choice of container vessels versus bulk carriers, not only the freight rate factor but also several economic factors are likely to be influential. However, there has been a lack of research on the factors that influence transport-mode choice between bulk carriers and container vessels. Several benefits inherent to container vessels for hauling bulk cargo can be considered. For example, as the lot size of a container vessel is much smaller than that of a bulk carrier, shippers can choose the optimal transport mode in accordance with several conditions (for example economic conditions). In times of economic recession, a shipper might procure low-volume cargo and, in this case, container-vessel haulage might be preferred. In addition, in cases where bulk-carrier rates are high, shippers might prefer to use container vessels to save on transport costs. In this sense, it is important to reveal how shippers choose transport modes and under what market conditions they make those decisions, not only in academic but also practical terms.
This study aims to reveal the factors that affect shippers' choices of transport mode between bulk carriers and container vessels. For comparison purposes, choice models are developed for three routes, namely, from the United States...