Airport Brokers Corporation works with all of the ocean carriers and most of the NVOCCs. A NVOCC (Non-Vessel Operating Common Carrier) acts as a consolidator of cargo for Less than Container Load (LCL) lots and may offer rates for full containers as well. This gives our clients a wide range of transportation possibilities. We have weekly consolidations arriving from and going to most major world ports. To give you more information on shipping by ocean:
All ocean carriers and non-vessel operating common carriers who have cargo arriving or departing the United States by water must have their tariff, bills of lading and rates filed with the U.S. Federal Maritime Commission (FMC).
Ocean freight rates are usually based on a.) the weight of the shipment; b.) the volume of the shipment; or, c.) a full container rate. On shipments less than container load lots (LCL) the rates are quoted per 1,000 kilos (weight) or per cubic meter (CBM - volume). The ocean freight rate may be one rate if the cargo is rated per 1,000 kilos and other rate if the shipment is rated by the volume; although, most often, the rate is quoted at something like $80.00 per 1,000 kilos or per cubic meter, whichever produces the most revenue. The reason why carriers are concerned about the volume is that they need to charge a certain amount for the space the cargo takes up. In other words, they do not want to carry a container load of feather pillows for next to nothing. Most cargo tends to move on the basis of the volume rather than on the basis of the actual weight. It just works out that way.
For those who are not familiar with working cargo math problems, 1,000 kilos equals 2,204.6 pounds, which is also known as a metric ton. A cubic meter equals 35.31 cubic feet; so, to find the number of cubic meters you would take the height (in inches) and multiply that by the width (in inches) and multiply that by the length (in inches) to get the number of cubic inches. Take the number of cubic inches and divide that by 1728, the number of cubic inches in a cubic foot (12 X 12 X 12). This will give you the number of cubic feet in the shipment. Divide that by 35.31 and you have the number of cubic meters. Remember, when you take the dimensions, take the outside dimensions of the crates or boxes, including the pallets if the cargo is shipped on pallets. It all counts.
So, doing the math some more, if a shipment was 2,300 kilos and 3.1 cubic meters, and, of the rate was $85.00 per weight or measure (1,000 kilos or cubic meter), the rate used would be $85.00 times 3.1 cubic meters because it produces more revenue than $85.00 times 2.3 (2,300 divided by 1,000 kilos).
Cargo shipped in Less than a Container Load lot is said to be LCL cargo; or it may be referred to as CFS cargo because it moves from one Container Freight Station (CFS) to another. A container freight station is a warehouse where numerous LCL shipments are brought to be consolidated into an ocean container for movement by vessel.
On full containers the ocean freight rate is usually a flat rate per container. You would have one rate per 20' (20 foot) container, another rate on a 40' (40 foot) container and another rate on a high cube container. The most standard containers are the 20' and 40' containers. A 20' container is about 20' by 8' by 8'. These are the outside dimensions of the container and you loose a few inches for each dimension when you measure the inside dimensions, due to the thickness of the container walls. Container dimensions will tend to vary a bit by manufacturer and steamship line.
On ocean freight shipments there is usually a receiving charge for the warehouse's receiving of the freight, loading it into the container and delivering the container to the ocean carrier. This can be referred to as a terminal receiving charge and is usually paid for by the shipper, no matter whether the price quoted is F.O.B. port of origin or C.I.F. destination. Full containers usually are charged for a terminal receiving charge as well. (See terms of trade.)
In addition to the terminal receiving charge, the ocean freight rate and the dock delivery charge (DDC) there may also be other "surcharges" charged as well. On order for the ocean carriers to increase their ocean freight rates they need to file them with the U.S. Federal maritime Commission (FMC) 30 days prior to their effective date. Ocean carriers argue that this is excessive when a Middle East War might increase their fuel charges overnight. Therefore, the FMC allowed the ocean carriers to charge surcharges in addition to the ocean freight to cover things like currency fluctuations (currency surcharge), cost of fuel fluctuations (fuel or bunker surcharges) and port congestions (port congestions surcharge). When you check out ocean freight rates you need to: a.) get the ocean freight rate; b.) ask whether there are any surcharges; c.) if you are an exporter, ask what the terminal receiving charges are; or, if you are an importer, ask if there are any dock delivery charges; d.) ask if any rate changes have been filed or contemplated; and e.) ask if there is a tariff item for the commodity. Again, each commodity will have its own commodity item and rate, based on the commodity description.
For your protection you should read the back of the carrier's ocean bill of lading. Although most carriers are standard in their coverage, liability for loss is usually $500.00 per package and, again usually, depending upon the carrier, the consignee has 3 days in which to file a preliminary claim. Therefore, if you have loss or damage to a shipment, file or make sure that a Preliminary Claim is filed immediately with the ocean carrier. If there is a claim for loss or damage to a shipment, the consignee usually has 1 year in which to complete the filing of a final claim. (See our page on cargo insurance for more information on insurance and claims). The ocean bill of lading will also advise you on other important matters such as what happens to your shipment in the event of a strike. You should take the time to read one over at least once.
Airport Brokers Corporation is a member of IATA (the International Air Transport Association) and CNS (Cargo Network Services). membership shows that we are professionals in the air freight field. We represent all of the major airlines serving the United States.
Air freight rates are based on the actual weight or volume weight, whichever is the greater. To determine the volume weight of an air freight shipment you would take the length of the package or pallet and multiply that by the width and multiply that by the height. The result would be the total number of cubic inches for the shipment. Divide the total number of cubic inches by 166 and you have the volume weight of the shipment in pounds. If the volume weight, in pounds, is higher than the actual weight, in pounds, that will be the chargeable weight for the shipment. Sometimes shippers are surprised at the cost of the air freight because, when they requested an air freight quote, they computed the shipment cost from the actual weight and did not take into consideration the volume weight of the shipment.. If you shipment is rated on the basis of the volume weight, you might want to determine if you can reduce the amount of packaging materials and still protect the freight or, if you ship on pallets, take the freight off the pallets because the pallets themselves add volume.
Air freight rates are stated in kilos. To convert pounds to kilos, divide the pound weight by 2.2046. This will give you the weight in kilos. Do the same calculation to convert the volume weight to kilos. There is a minimum charge, a rate for under 45 kilos (-45k), a rate from 46 kilos to 99 kilos (+45k), a rate from 100 kilos to 299 kilos (+100k), a rate from 300 kilos to 499 kilos (+300k), a rate from 500 kilos to 999 kilos (+500k) and a rate for shipments in access of 1,000 kilos. In addition to the rates per kilo the airlines have container rates for large shipments..
The air carrier's normal liability for loss or damage to a shipment is usually $20.00 per kilo. As in ocean transportation, it is important to review the carrier's terms and conditions on the reverse of the air waybill so that you are aware of the time limits for filing and claims for loss or damage, where to file claims, etc.
While, with ocean freight, the shipper usually pays all of the charges and costs for moving a shipment from the shipper's or manufacturer's warehouse to the exporting carrier, the cost for the export documentation and the costs for lading the shipment on board the exporting carrier, with air freight shipments, although the terms of sale are FOB the exporting airport, most often the shipper has these charges go collect on the exporting air waybill; so, they are paid for by the consignee. It is important for buyer and seller to know and agree to the terms of sale.
On air freight shipments, the Federal Aviation Administration (FAA) is requiring that all shippers fill out a Security Certification stating that the goods in the export shipment do not contain any unauthorized explosives, destructive devices or hazardous materials.
Shippers of dangerous goods should take classes to educate and prepare them to handle the shipments. A Hazardous Cargo Declaration needs to be completed by the shipper on shipments of dangerous goods. The shipper is responsible for making the declaration out correctly, having the freight packaged in the correct United Nations (UN) approved type of container for the goods and making sure that the goods are labeled correctly. If the shipper does not know all of the information required for the declaration, labeling, etc. the shipper must contact the manufacturer for the information. While we can assist exporters in locating the correct information, the declaration, packaging and labeling of the freight is the shipper's responsibility.
What are dangerous goods? Well, we all know the easy one such as flammables, explosives, etc.; but dangerous goods also include cars and motorcycles because of their fuel and batteries (fuel will explode and acid will eat through the aircraft or vessel's hull), wheelchairs that contain batteries with liquid acid, electrical switches that contain mercury (it will eat through an airplane's or vessel's skin), poisons, magnets (because they can interfere with the carrier's instruments) and dry ice (because it gives off toxic fumes), to name a few.
All shippers are now required to fill out a Shipper's Declaration stating that they are NOT shipping hazardous or dangerous goods or, if they are shipping them, that they have declared, packed and labeled the goods correctly. A false statement of the shipper's declaration is a criminal offense. If a shipment is found to be in violation of the declaration you can expect penalties, fines and legal action.
There are classes on how to ship dangerous goods in each part of the country put on by a number of experts. Call or fax us for the names of some of the companies that put on the classes or check out links page for contacts.
The above are some of the things shippers and consignees should know. We handle ocean and air freight consolidations to and from all major world ports and airports. For all of your transportation needs, contact us at:
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