Terminology that apply during sea freight.
Basic terms
B/L (Bill of Lading) – a sea waybill for transportation of cargo.
Shipper – the sender of the cargo.
Consignee – this person or entity is the shipment receiver and generally the owner of the shipped goods.
Notify party – the person designated on a Bill of Lading, Sea Waybill or Air Waybill to be notified when a shipment arrives at its destination.
Freight – the charge for the transportation of the cargo.
Loading – the physical placing of cargo into a carrier´s container, or onto a vessel.
Discharging – a place where a vessel discharges or unloads some or all of its shipments.
Feeder – a small vessel that transfers goods to/from smaller ports and delivers them to the larger vessel for further transportation. When ordering long distance transportation, local feeder transportation is included in the freight amount, no separate order or payment is required.
TEU (Twentyfoot Equivalent Unit) is a unit of cargo measurement equal to the volume of a 1×20 FT container. 1×40 FT container = 2TEU. For a 40 FT container, the TEU rate must be multiplied by 2.
Transportation conditions
CY (Container Yard):
- which is where containers are stored on the terminal or dry port before they are loaded or offloaded from a ship;
- a method of transportation of ISO freight containers in which the carrier is responsible for the container entrusted to him from the moment of its transfer at the container yard (container terminal) of the port of departure to the moment of its unloading at the container terminal of the port of destination.
Door to door – a shipping method where freight is picked up at the door of the sender and delivered to the recipient’s door. The shipment is collected from the sender and taken directly to the recipient.
FI (Free In) – condition of carriage at departure – means that the freight does not include the cost of loading on the ship.
FO (Free Out) – condition of carriage at destination – means that the freight does not include the cost of unloading from the ship.
LI (Liner In) – means that the cost of receiving/processing the cargo at the container terminal and loading on the ship is included in the freight rate.
LO (Liner Out) – means that the cost of unloading from the ship and the cost of receiving/handling the cargo at the container terminal are included in the freight rate.
BAF (Bunker Adjustment Factory) – additional charge to the base freight rate, the value depends on the cost of fuel on the international market. It may vary monthly or quarterly.
CAF (Currency Adjustment Factory) – is an additional charge to the base freight rate, the value depends on the change in the exchange rate. It may vary monthly or quarterly. Usually quoted as a % of the base freight rate.
IMO Surcharge – dangerous Goods surcharge.
ISPS or SEC (security charges) – port Security Charge
GRI – scheduled increase of prime rate from a certain date.
THC (Terminal Handling Charges) – originally any terminal services for handling cargo: loading/unloading from ship, stacking, staging, etc.
Heavy Lift Charge – a surcharge for exceeding a certain weight of cargo (used in case of a large number of heavy cargoes on a certain direction).
PCS (Port Congestion Surcharge) – a surcharge due to congestion of container areas of the port.
PSS (Peak Season Surcharge) – a surcharge due to seasonal increase in the volume of transportation at a certain time of the year («high season»).
WarRisk – war risks, charged in ports located in the war zone.
WinterSurcharge – winter surcharge, charged in ports where there is a possibility of port water area icing. It is valid during the winter period.
Additional terms and charges
Payable to local line agents usually through port forwarders.
Demurrage – penalties charged for excessive use of a container from the time it is unloaded at the terminal until the empty container is returned to the port (for imports) or from the time the empty container is received for loading until the loaded container is loaded on the ship (for exports).
The period of container utilization can be divided into Demurrage and Detention. Demurrage is the penalty charged for excessive use of the container from the time it is unloaded at the terminal until it is removed from the terminal. Detention penalties charged for excessive use of a container from the time it is unloaded at the terminal until the empty container is returned to the port.
AdministrativeFee = B/LFee = DocsFee (other designations are possible) – local line agent fees for paperwork. May be charged per bill of lading or per container.
Additional Port Charges – paid to the port usually through port forwarders, may be collected directly by the port or local line agents.
Storage – rate for excess storage of cargo at the port. It is calculated from the time of unloading at the terminal to the time of removal from the terminal. Charged at port rates. Usually quoted per TEU and has an increasing scale (the longer the cargo is in the port, the more expensive each next day of storage).
Inspection fee – rate for the work of placing the container on the inspection site (customs, sanitary, etc.). Charged at port rates, on an actual basis.
Rates for additional operations – port rates for any work not provided for in the usual container handling scheme (repacking, weighing, sealing, marking, etc.). Charged at port rates, on an actual basis.
