What is the difference between ports and terminals?

Ports and terminals are terms that get interchanged frequently but, they are entirely different things. What is the difference?

From an ownership perspective a port is a collection of many terminals. Think of the port like a state that has many cities. A terminal is part of a port and a number of terminals compromise a port.

Ports are government organizations that are run publicly and they usually attempt to make a profit for government spending. Ports are run with the focus of creating economic impact in the region and surrounding areas as well as boosting trade internationally. The terminals are plots of land that are owned by the port. The method of operation is differs across the world from port to port.

The Port Owned and Operation Model

In this Port Owner - Operator model, the Port authority performs all the work involved with loading and discharging a ship. The port owns the land, the infrastructure, the equipment, and directs the labor. This models is advantageous in good times as the Port authority would receive all the revenue and profit from the ship operations. However, this also means that the Port is open to loss if there are issues and when revenue shrinks. Because ports work in the public eye and for the public, they are often bogged down with internal audits and compliance protocols, as well as other various red tapes.

The Public Partnertship Operation Model

In the half and half model, the Port performs some of the operations while private sector performs the other half. This is seen commonly in break-bulk facilities where a regular vessel service does not exist. For example, a ship full of iron ore arrives on an as needed basis. This ships could arrive every week for a month then not come again for three months. There would be no financial incentive for a private company to hold a lease on the terminal for ad-hoc ships.

In this model a private terminal operator would perform the work on the ship, sometimes renting Port owned equipment, while the Port would perform the terminal or yard side of the operation. In this operation, the Port would recieve revenue for every ton or per piece that moves into the terminal.

The landlord model is exactly as it sounds. The Port rents the land and infrastructure to a terminal operator who would supply all the equipment and perform all the work. This is most commonly seen with steady liner services, like container terminals. The terminals operator is free to work as needed and allwoed to accept as much work as they desire. All revenue belongs to the terminal opertor as well as do all profits and losses. The Port recieves regular lease payments and these are gauranteed through contracts with the leasee / operator.

The Private Model

The private model is exactly like the public operation model except in reverse. This model is where private industry - terminal operators - own the land, infrastructure, equipment, and perform all the work. There is regulatory oversight of these terminals but, private industry is largely allowed to operate as the see fit.

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