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Frequently Asked Questions
What Factors Impact the Calculation of Sea Freight Rate?
The calculation of sea freight rate depends on three factors as mentioned below:
- Carriers/Line charges
- Cost of handling and clearing the goods at the port of loading and port of discharge
- Type of container i.e FCL (Full container load) or LCL(Less than container load)
How are Freight Rates Calculated?
Freight rate or Freight quotation mostly consists of freight and surcharge items as mentioned below:
- Basic charge/rate of Ocean Freight
- Inland Haulage
- Terminal Handling Charges - container handling at the port & consolidation warehouse
- Customs Clearance
- Surcharges for additional security measures, which are imposed by the port
- Bunker Adjustment Factor or Fuel surcharge for sea transport
- Hedging of currency exchange risk
- The above charges are most of the charges that are included in the calculation of freight rates while Shipping under CFR incoterm.
How to compare freight rates from various Freight Forwarders?
Different freight forwarders will quote different freight rates. For instance, Freight Forwarder-1 may quote a final rate by including all other charges and Freight Forwarder-2 may quote just the basic freight rate and keep other charges additional. In such a scenario, it is always recommended to find the final 'Landing Cost' from the Freight Forwarder or Service Provider.