Since we receive all different kinds of questions about international sea freight we decided to create a guide that includes all important information and the tasks to think of when importing to / exporting from Australia. Below you will find Part 1 of our “Ultimate Checklist for International Sea Freight” which covers Mode of Transport, Arranging Transportation, Common Sea Freight Incoterms (2010) and Packing and Marking Instructions.
Mode of Transport
Sea freight is the most common and cost-efficient mode of transport for goods that need to go long distances and are not that time sensitive.
Goods are transported in containers of either 20 foot or 40 foot in length. Depending on the size of a shipment goods are sent either as FCLs (full container loads) or LCLs (less than a container load).
The most common type of shipment is General Cargo, which is conventional cargo that is transported in bulk, boxes or palettes. Ships transporting general cargo operate on fixed schedules and frequently go on designated routes. For more information on shipping schedules please see the BCR Taiwan Consolidation schedule specialising for LCL shipments from Taiwan to Australia and the BCR Coastal Shipping Schedule for FCL shipments from the east coast to the west coast of Australia.
Another option is sea freight chartering, where a ship is chartered for a particular type of goods (e.g. oil, ore or grain) for a specific route that the client requested.
The so-called RO/RO is another option to ship goods, which do not fit into a common container. Especially constructed vessels are used, similar to a car ferry. Vehicles can be easily rolled on / rolled off the vessel via a ramp. Other “non-rollable” goods are put on flat-racks and loaded on the vessel.
Depending on the origin/destination, value and time-sensitiveness of goods, multimodal shipping can be used, meaning a combination of e. g. air freight, sea freight and road.
To arrange an international shipment, get in contact with an established freight forwarder who ideally has experience with the countries you want to import from or export to. They can assist you the best especially when it comes to particular country restrictions, documentation, costs and much more. When you get in contact with the freight forwarder he will need information on your planned shipment. To save time be prepared. Find below a list of information to provide to your freight forwarder:
- 1. Name of your company, your email address
- 2. Incoterms
- 3. Import / Export
- 4. Mode of transport (in this case international sea freight)
- 5. Origin and Destination
- 6. Type of goods
- 7. FCL (Full Container Load) / LCL (Less than a Container Load)
- 8. Measurements
- 9. Quantities
- 10. Volumes and Number of shipments per month or year
Appropriate Incoterms (2010) for sea freight
The Incoterm defines who will be responsible for the costs and carry the risk of the shipment.
When preparing the shipment, the buyer always decides on the port at destination and the final destination.
The most common Incoterms for international sea freight are the following:
EXW – The buyer pays all costs from the door to the supplier to the final destination.
FCA – The seller is responsible for any pre-carriage of the cargo to the point of delivery in the country of origin. This can be an airport or seaport but also a different warehouse (depending on the country). The seller pays the original documents (export clearance documents).
CPT – The seller is responsible for all costs until the destination port. The buyer carries the risk and takes care of the delivery from the port to the final point of destination, including duty.
DDP – The seller is responsible for all costs and carries all risks, including duties until the final point of destination.
FOB – Is the most common Incoterm for international sea freight. The seller is responsible for the goods until they are loaded on board of the ship, which was chosen by the buyer. The buyer is responsible for the sea freight and the delivery to the final point of destination. The buyer also pays the duties.
CFR – The seller is responsible for all costs to the port of destination. The buyer then is responsible for the transport from the port to the final point of destination, including duty.
CIF – Like CFR, the seller is responsible up until the port at destination. The buyer than takes care of the transport to the final point of destination. On top the seller is the insurance contractor.
Packing and marking instructions
To secure the goods and avoid damages, goods need to be properly packaged. Containerised goods are exposed to more outside influences than goods of other mode of transports, like extreme weather conditions, variable temperatures (for non-refrigerated goods), long distances, double-handling and long travel time. Therefore it is good to factor in particular packing instructions for the specific type of goods to minimise damages.
When packing large and heavy products (e. g. 300kg), keep in mind e.g. some trucks or roads may have a maximum weight. Sometimes it may be necessary to break a heavy package down into multiple packages. We recommend to check with your freight forwarder in advance.
When preparing packaging keep in mind, sometimes purchasing higher quality of packaging material will pay off in the long run.
After the goods have been packaged you will need to mark the package. Proper marking has several advantages, when applied correctly it will help with identification and will lower the risk of damages.
In case the content of a package can break when it is laid on the side or upside down, mark which side has to be up (“top” or “this side up”) and if it is fragile.
Use international, standardised shipping marks, which helps all people handling the package to understand the instructions and marks, even though they speak different languages.
Make sure all shipping marks are easy to recognise, even from a certain distance.
In Part 2 of the “Ultimate Checklist for International Sea Freight” we will give detailed information Communication, Country restrictions, Documentation, unforeseen charges, quality control, customs clearance, receiving goods and damages.
For more than a century, BCR has continued to help small, medium and large businesses achieve an optimum logistics solution with warehousing and transportation, including air freight and sea freight services to and from the major ports including Brisbane, Sydney, Melbourne, Adelaide and Fremantle (Perth).