International shipping rates are the price at which a specific shipment is delivered from one place to another. This can depend on
the the mode of transport (air freightocean freight, rail freight, or road freight)
the weight or volume of the shipment
the nature of the shipment (dry or fluid, general or dangerous, regular or refrigerated)
the form of the shipment (containerised FCL/LCL, or not)
As a shipping company both local and global, our job is providing china freight forwarding services for international delivery. We are always trying to provide you a quick and clear amount, when you arerequesting a cargo ship quotefrom us. But in fact,the process behind the scenes is more complicated than the total price you got seem to be.
Cargo ship rates are normally provided in the form of a freight quotation, and the format of these quotations can vary from freight forwarder to freight forwarder and shipping company to shipping company.
Whilst new surcharges seem to be introduced daily, your freight price will most likely be made up of the below tariff rates & surcharge items. Heres a rundown below.
The term is pretty self explanatory. Its the base rate for ocean freight.
2. BAF Bunker Adjustment Factor
2.1 Associated with vessel fuel cost.
2.2 Charged per size unit. I.e. 20 cntr = $350 40 cntr = $700
2.3 Different carrier and different route with different standards.
3. CAF Currency Adjustment Factor
Associated with fluctuations in exchange rates.
4. HWG Heavy Weight Surcharge
For exceeding certain weight. 20ft containers exceeding the weight of 14,000 kg (or 18,000 kg, or 22,000 kg). This concerns 20ft only.
5. EBS Emergency Bunker Surcharge or EBA Emergency Bunker Adjustment
Associated with extraordinary vessel fuel cost.
6. FAF Fuel Adjustment Factor
Almost same as BAF, applied toJapan, the Persian Gulf, the Red Sea, andSouth America
7. GRI General Rate Increase
8. PCS Port Congestion Charge
Associated with losses caused by congestion and idle time for vessels serving that port.
9. PSS Peak Season Surcharge
Associated with incremental operational costs incurred during the peak season.
11. YAS Yen Applica Surcharge
There may be additional charges depending on where you are shipping to, but the above are the core freight cost components when shipping from China.
Different routemeans different calculation method. Please find the tables below, also please note its for reference only (subject to change).
THC Terminal Handling Charge
OTHC, Origin Terminal Handling Charge
DTHC, Destination Terminal Handling Charge
Charged by the carrier for the handling of containers at the container terminal before being loaded onboard a vessel, including the unloading of the container from a truck, stacking and transport from the stacking location to just below the crane near the shore.
Admin charge for required shipping documentation. May apply for a bill of lading or container.
Period of container can be divided into Demurrage and Detention. Normally 7 days free for both of them.
Then Demurrage penalties imposed for excess use of container from its unloading at the terminal until the time of export from the terminal. Detention penalties imposed for excess usage container since its removal from the terminal until the return of empty containers at the port.
It is calculated from the moment of unloading at the terminal until the time of export from the terminal and is increasing the scale. Commonly 5-7 days for free of charge, longer the carrier is in port, the more expensive each day of storage.
This rate for work on putting the container on the ground clearance (Customs, health, etc.).
The above guide has been written from the point of view of exporting from China and under theCFR incoterm.
This means that consignments are usually shipped from Port to Port and charges not included in the prepaid freight amounts will be for the account of the buyer/consignee i.e. destination THC, destination documentation, destination customs clearance and any delivery to the consignees door.
Shipping rates calculation is complicated, especially there are special rules applied to different routes. Thats why we provideall in rates, meaning that the cost of transportation includes all the additional fees and surcharges provided for under the conditions of carriage.
You may find tools online for calculating such cost. But as far as we know, the results are not so accurate. So if you are looking for a freight quote for your cargo from China, dont hesitate to visit ourquote formand submit your request. Itsfree, quick, and accurate.
The cost vary from each week or two weeks. Theres a list showing why this happens.
The biggest cost item for the carrier companies is fuel, either the ocean carriers or the airline carriers. There is a constant volatility in oil prices, they are affected by these increases and therefore reflect them onto their freight prices.
This is a floating surcharge that the Carriers can change when oil prices rise or fall. It is called BAF as we mentioned above.
Shipping cycle starts with a shortage of ships and increase in the freight rates. This leads to excessive order of the ships and the airplanes. The delivery of new ships and new airplanes lead to more supply in the shipping capacity.
If they are not invested in, but the trade grows there will be a shortage of ships and therefore lost profits. If they are invested in but the trade does not grow, this will complicate the market more and pull the prices down.
The shipping cycle is a mechanism to coordinate supply and demand, and has a total of 4 stages which are trough, recovery, peak and collapse.
As all businesses, shipping line carriers and airline carriers have to make profit in order to continue their existence. Therefore, whenever there is an opportunity, the market will attempt to implement increases in the rate.
While there are several factors involved, the primary is market demand. According to our years hand-on experiences asa local forwarding agentin China, we can find
From December through April for imports from China, it is traditionally called the slow season. Because the retail market slows down after Christmas.
From mid January through early February there is an upsurge of cargo moving to beat the Chinese New Year deadline whereby factories all over China shut down for weeks. This usually keeps rates high as there are always space problems for cargo getting on vessels.
From May through November this would be the peak season where there is a big demand for cargo exporting, so the carriers raise the rates during this period, with the GRI (general rate increase), and PSS (peak season surcharge).
If you are a small to medium sized importer and do not have a logistics team, you may find yourself wasting time trying to keep up with the ratesshipping from Chinainstead of promoting your goods to your customers.
Because the amount is dependent on many factors including origin, destination, volume, time of year, plus many other variables. Unless you have a contract with the carrier or are moving significant volume, you will usually get a more favorable deal from a freight forwarder, who will likely have access (directly or indirectly) to a discounted rate based on certain volume agreements.
Just keep in close touch withyour freight forwarder. A good forwarding service can save you untold time and potential headaches while providing reliable transportation of products at competitive rates.
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