The Ultimate Guide For International Shipping Cost

International shipping cost

The fees and charges in an international shipping cost may be complicated, but they can be simplified by considering a few different things. Basic freight charges aside, there’s a whole range of factors to consider. Port and custom charges, as well as additional fees under very specific circumstances, all factor into an international shipping cost.

Although most fees that apply to international shipping are included in the quoted rates by freight forwarders and carriers, there are some that may be left out. In this guide, we’ll detail the different costs of international shipping so you know what you’re paying for.

Freight associated charges

The maritime freight charge is the main cost of your ocean freight shipment, and you should always check with a shipping company to get an estimate. Remember that the price varies according to the shipping company and the route.

Maritime trade flows drive freight costs. The cost of freight for exporting products to Asia is cheaper than the cost it is to import products from Asia.

A General Rate Increase or GRI is a necessary measure taken by carriers to offset the effects of lowering prices. These breaks in price can have a domino effect with other carriers following suit. However, when the bottom limit of the break-in price is reached, carriers must raise prices to compensate.

Low-volume shipments are often faced with the cost of a consolidation fee. This charge applies to low-volume shippers who choose to consolidate their shipments in order to conserve space. The freight forwarder or consolidator will charge for this service.

Carrier-related fees

One of the many surcharges shipping lines implement is a fuel surcharge. When fuel costs go up, a shipping line might add a surcharge to their basic freight rate. And in situations where demand for a certain product is high, a shipping line might add a surcharge to cover the additional expense.

Carrier-related surcharges are difficult to avoid, but they are easy to identify. The four major carrier-related surcharges are EBS, BAF, CAF, and PSS.

The Bunker Adjustment Factor is the fuel surcharge on shipping and is also known as the bunker surcharge. The number of TEUs shipped affects the BAF and it is charged to pay for fluctuations in fuel prices. This surcharge can change from route to route and is known by different names.

The EBS is like the BAF in that it cuts fuel rates. However, there are significant differences when it comes to when and where it is announced. The EBS is only announced in the US 30 days in advance. In most other parts of the world, it's applied at the last minute. Unlike the BAF, which is often given in advance.

The CAF is a type of insurance that protects against fluctuations in currency exchange rates. It is usually applied when there are significant changes in the currency's value and it is calculated as a percentage of the ocean freight rate.

Carriers implement peak season surcharges in order to cover the increase in operational costs during this time. This is a great way to cover a business's increased shipping costs during this peak period, but it can greatly increase your overall international car shipping costs.

Zone-specific charges

Your international shipping cost may be affected by your trade lane. Although prices are typically more expensive the longer the distance, the type of transport you choose can also affect shipping rates.

Besides the extra fees for using waterways such as the Panama Canal and Suez Canal, there may be other costs associated with high-risk zones or international import taxes.

Delay fees

Delay fees are common for all shippers, but you can take steps to mitigate risk. For example, you can try to avoid ports, terminals, and yards that are congested. However, if your shipment does get delayed by these factors, you can be on the hook for a fee after fee if it's more than 100% late.

Shipping lines and warehouses will grant you a certain amount of free time to use their containers. After that time period is up, your company may be charged for delays.

Some of the more common delay fees are demurrage, detention, per diem, warehouse, and storage fees.

Taxes and duties

Taxes and duties vary by the worth of the merchandise being imported into a destination. The importer is usually responsible for the payment of this fee, but there are exceptions. For example, if you're an exporter and you know that your products will be passed through a country that charges taxes and duties before they reach their final destination, you may be responsible for those fees.

Taxes and duties are not charged for the shipping of items. Customs offices determine taxes and duties based on the HS codes of the destination country and they vary significantly.

Customs fees

Customs clearance is the process of determining whether goods are in order and can be entered or left through customs. Customs clearance fees are necessary to cover the administrative costs of certain procedures and processes. The fee varies by country, but it's typically less than the number of duties and taxes owed.

In certain cases, you may be charged additional fees. For example, customs may deem it necessary to inspect your merchandise. In these cases, you may be charged for inspection charges, transportation charges to the warehouse where your cargo will be inspected, as well as warehouse charges.

Port charges

Different regions of the U.S. differ in their terminology and prices for port charges. Even within the US, different states have different terms. For example, the "PierPass" in Los Angeles has a very different fee structure to the "MassPort Usage Fee" in Massachusetts.

There are many different types of port charges. You will have to pay for wharfage fee, security deposit, T3, THC, etc. But the most common are T3 and THC.

To avoid a sudden and unexpected freight bill, we recommend getting an estimate of your international shipping cost before committing.