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Freight. The cost of sea shipment

Freight is a special term used in overseas shipping. Freight is a contract of vessel’s engagement for an overseas shipment or the lease of a vessel for a certain time period. Entering into the agreement one party, the freighter agrees to ship the cargo from one port to another and the other party, the consignor pays the stipulated fees. 

Containers sea freight rates include:

 basic freight rate;

extra charges;

loading and unloading fees.

The major extra charges are:

  • BAF (Bunker Adjustment Factor);
  • CAF (Currency Adjustment Factor);
  • IMO Surcharge (hazardous cargoes’ fee);
  • Winter Surcharge.

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Loading and unloading fees are not always included into the freight rate; the consignor should find out who pays for these expenses beforehand. There are special acronyms used to define the terms of freight as regards loading and unloading denoting the parties bearing the charges:

- FI (Free In) - the cost of loading operations is not included into the freight rate;
- FO (Free Out) - the cost of unloading operations is not included into the freight rate;
- LI (Liner In) - the cost of loading operations is included into the freight rate;
- LO (Liner Out) - the cost of unloading operations is included into the freight rate. 
Freight rates usually indicate loading-unloading terms both at the port of loading (POL) and port of discharge (POD), i.e.: FILO, LIFO, etc.

A forwarding company is the major link between the freighter, the consignor and the consignee. What’s more, in containerized cargoes transportation the forwarder himself frequently acts as a freighter.

"Credo Trans" works in close cooperation with all the sea container lines at the port of St.-Petersburg. Our specialists are always ready to advise the Clients on the optimal routes, to choose shipping lines most appropriate for transporting consignments to the needed destination and to offer highly competitive rates allowing to save shipment expenses.

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20 September 2018
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