values, was engineered by a well-known New York business house
largely interested in American railways. In England it was
variously attributed to a resolve on the part of American traders
to share in the transport of the national trade; to a desire on the
part of the lines concerned to effect economies by a consolidation
of management, and to a scheme intended to benefit certain
great American railways. The transaction gave rise to much
comment in Great Britain, being by not a few regarded as contemplating
the eventual transfer of the lines to American ownership.
And indeed, though the steamers continued to be under
the British Hag, the extent to which they remain substantially
under British ownership cannot be affirmed. It was stated in
1908 that on completion of its building programme the combined
fleet would consist of 132 vessels of together, 1,159,704 tons.
The general adoption of steamships in place of sailing vessels
was gradually followed by their separation into two classes, one
devoted to a fixed service on regular lines of employment, the
other to promiscuous trade. The former class are now known
somewhat vaguely as “ liners, ” ranging, however, from the
first-class mail and passenger steamer on the one hand, to the
regular cargo steamer on the other. To the second class belong
the “ seekers” or “ tramps” which come and go wherever
profitable employment offers, and which more especially lay
themselves out to be chartered to carry full cargoes of coal,
timber, wheat, nitrate, jute and such like. These vessels, some
of which are of great capacity, are frequently in competition
with the liners. This competition sometimes results in “cut
rates ” of freight, to the serious loss of the great ship owning
firms and companies. With the establishment of regular lines,
moreover, there grew up competition between rival lines, with
similar results. A solution was found by the creation of working
agreements between rival lines at agreed rates of freight, but
the lines thus associated were still exposed to the attacks of
tramps ” upon what the liner owners regarded as their privileged
trade. Fierce conflicts from time to time ensued, with great
disturbance of the freight market and with consequent loss or
inconvenience to the merchants themselves. As the result,
shipping “ rings ” or “ conferences" were created in many
trades, the owners of the liners undertaking to provide the traders
with a regular service accompanied by advantageous conditions,
whilst the traders undertook to ship only by the conference
steamers. In order to ensure this support, the shipowners
instituted the system of deferred rebates, under which each
merchant, at the end of a year or other fixed period, should be
entitled to a discount or rebate on the amount of freight paid by
him during such period, provided that he should have shipped no
goods at all by steamers outside the conference, the discount only
to be paid after a further fixed period of six or nine months,
during which time also he should rigidly support the conference
lines. In the event of failure to comply with the conditions, a
merchant is exposed to forfeiture of the rebate, and in addition
to measures in the nature of a boycott on the part of the conference
lines. Notwithstanding, attempts are from time to time
made by steamers outside the ring to gain admittance, with the
consequence of occasional freight wars, and with the incidental
result that goods are sometimes carried, for example, from
America to a British colony at lower rates of freight than similar
goods manufactured in England. Mainly on account of complaints
made against the working of the South African ring, a
British royal commission was in 1906 appointed to take evidence
and report upon the subject generally.
With the growth of populations and the development of means of transport, both by land and sea, a great increase arose both in production andlconsumption, and competition became very keen for markets, both home and foreign. In this competition the cost of carriage is always an element of great importance, even though the freight payment may bear but an insignificant relation to the value of the goods carried. For in modern trade rivalries every penny saved in charges counts with the importer, and if goods of a similar kind can, by reason of lower transport charges, be obtained a fraction cheaper from one industrial centre than from another, the tendency is to give the preference to the centre or H
country which can deliver most cheaply to the consumer. Trade follows cheapness, and, with the world's industrial development, the striving for cheapness took at the outset the form of economies in production. The day of small trade with large profits was passed, and producers of all kinds now aimed at a large output at diminished cost, and contended themselves with a smaller ratio of profits on a larger business. The utmost economy was studied with a view to successful competition, especially in overseas markets; and in this struggle for the cheapening of supplies the cost of transport became an important element. The fact was recognized that the ship is but a link in the chain of connexion between producer and consumer, and the system of “ through ” bills of lading was introduced, under which a particular steamer line or railway service contracted for the through carriage of goods in conjunction with other lines, with the object and effect of cheapening the transport as a whole. Individual shipowners, in order to obtain cargoes for their ships, were in turn driven to devise economies in transport, with the result that rates of freight were continually reduced. In modern ocean carriage size means cheapness, the transport of a given weight of cargo being cheaper in a single vessel than in two vessels each of half the size. For not only does this concentration of carrying power effect economy of officers and crew, with their wages, provisions and accommodation space, but in shipbuilding also size makes for cheapness. Thus, if, for example, two steamers each carrying 2000 tons will cost together say £4C, OOO, a single vessel of equal carrying capacity can be supplied for £35,000. Or, put another way, if for £40,000 two steamers can be built to carry between them 4000 tons, for the same sum a single vessel can, it is stated, be provided to carry 4700 tons. Consequently, the size of vessels is continually on the increase, and no sooner is a navigable channel at much cost made deep enough for the great vessels knocking at the door of the port, than still larger are constructed, and shipowners complain anew that the harbour depth provided is insufficient. The constant demand for greater depths resulted in the production of mammoth dredgers of which, also, the size and power are continually increasing. At the present time it is the navigable depth of ports and canals, and the need of adequate dry docks, rather than the obtaining of cargoes, which are the controlling factors in the size of great ocean vessels. But the heavy interest on the capital cost of these vessels and their working expenses call for the utmost despatch in their loading and discharge, and with the simultaneous arrival of several vessels of large tonnage, the question of prompt discharge is one of great and increasing difficulty. For many modern steamers will carry 10,000 tons of cargo, and some a great deal more; so that, withold-type railway trucks carrying ordinarily' only about 8 tons, it not infrequently happens that the discharge of the ship, equipped though she be with remarkable facilities for landing her cargo and assisted by discharge into barges, is impeded owing to deficiency of shore clearance. If 8 tons be taken as the capacity of an ordinary railway truck and 30 trucks be allowed to a train, ~it will be obvious that a single modern cargo ship will require a vast procession of rolling stock to clear her cargo. A single cargo of 10,000 tons, for example, will require some 125O railway trucks for its removal; or, allowing 6 yards' length to the truck, 7500 yards of rolling stock, without engines and vans. And, in fact, congestion of shipping owing to delays is frequently the cause of bitter complaint in the case of certain ports. Trucks of much increased capacity are now being introduced, but for various reasons their adoption is very slow. In port polemics the argument is sometimes heard that the backwardness of this or that port will result in the trade being driven elsewhere: the ships, it is said, will remove it. But the ship is but the blind instrument of trade, to come and go where and as trade calls it. The ship will, however, sooner or later require a higher rate of freight for ports of slow despatch, and this increased expense in transport will undoubtedly operate in favour of rival ports. For the ports themselves are but stepping-stones to or from a market or industrial centre, and the market will always select the cheapest route for its trade.
