Shipping: Containers, Rates and Documents

Shipping: Containers, Rates and Documents

Overview

There are numerous ways to get your goods from Asia to its destination. Sea freight is the by far most common one. Several aspects regarding the size and utilisation of containers have to considered. Furthermore, a variety of documents are required to organise shipping from China.

Article Highlights

  • The sizes and weight limits of containers are largely standardised.
  • LCL (Less than Container Load) and FCL (Full Container Load) is the most basic loading unit.
  • The bill of landing, bill of entry and commercial invoice are the crucial documents in the shipping process.

The key to any successful import company is efficient freight management. Information regarding container sizes and economic feasibility of such shipment are discussed, giving the reader a broad understanding of what to expect when shipping from China/Asia. Other associated logistics issues should be considered as well, such as how to get the containers from and to the harbour.

What are the Differences Between Shipping Containers?

Shipping containers come in standard sizes. A standard container is 8 ft. wide by 8.5 ft. high. The two standard lengths are 20 ft. and 40 ft. Extra tall containers are also available in 9.5 ft. Various shipping companies also offer special containers or bases designed for a specific market, for instance shipping wide construction machinery. This article focuses on standard containers.

Something to take note of is the weight restriction. Having this grand idea of shipping a container packed to the brim with desktop hard drives and profiting. Taking an average hard drive weight (excluding packaging) you will only be able to fit about 32000 of these in the container before you reach the maximum weight of 21 tons.  You will likely still be able to crawl around inside the container. The 40 ft. container also does not take a lot more, allowing only a maximum weight of about 27 tons. As you can see the 20 ft. container is more suited for material with a high weight density and the 40 ft. more suited for low-density items.  

The container and the shipping thereof is only part of the price, but are generally spoken of in the industry as a full package. The international shipping rate is normally quoted by a freight forwarder, knowledgeable about the specifics required for the shipment to land at the port of destination. One should also remember that shipping cost from China can vary wildly depending on the time of year. A rough estimate for a 20 ft. container for shipping from China to the US can vary between $800 – $1200. This shipping container price is based upon FOB terms, where the supplier handles all the transport and paperwork to get the container filled and on the ship. It does not include fees such as destination port charges and customs fees. It also does not include any import levies that may be charged by the destination country for the specific goods. Many other terms, aimed primarily and shipment and freight costing exist. These are collectively referred to as Incoterms.

 

Shipping from China in export containers.
China’s notorious export orientation is an important contributor to world trade and keeps shipping lines busy.

 

Share a Container

Dedicating an entire container to a small shipment is simply not feasible. Fortunately, freight companies have made it possible to share containers. In order to differentiate between single and shared loads, the terms LCL (Less than Container Load) and FCL (Full Container Load) is used. LCL shipping container prices are normally quoted in line with the volume of the shipment. This however, is only permissible up to a specific percentage value, after which FCL prices are quoted.

Documents Needed for Shipping from China/Asia

Various documents need to be obtained from the supplier in order for you to be able to claim your cargo at the port of destination. Using a trusted freight forwarder will ensure that you receive these documents well before your cargo lands, giving you peace of mind that you will not be paying any storage fees at the port. However, some scams exist where fraudulent freight forwarding companies target companies with legitimate shipments and hold them ransom for the documents needed to clear a shipment. These companies will likely have to pay the ransom to receive the documents, as it is normally far cheaper than port storage fees.

These documents mainly ensure that shipments are safe and that the correct customs can be calculated.

But let us specify the various documents needed shipping from China/Asia:

  • Bill of entry: This is a document prepared by a customs clerk or broken stating the exact nature and quantities of the goods within the container.
  • Bill of landing: Prepared by the shipping company and sent to you to be able to prove you are the owner of the goods when it is picked up from the destination port.
  • Commercial invoice: This is used by customs to calculate the duties payable.
  • Import licence: Some products will require you to have an import license for shipping from China/Asia to Western countries.
  • Insurance certificate: Although this is not specifically a legal requirement everywhere, it is best to have your shipment insured. This peace of mind comes fairly cheap, normally at about 0.2% of the total value of the goods.
  • Purchase order: Reflects all terms and conditions of the sale, enabling a customs official to properly calculate import duties.
  • Phytosanitary certificate: This is mainly a requirement if any plant based matter, like wood, is present inside the container (applies to crates, pallets and supports as well). This is to ensure no parasites enter the destination country when shipping from China/Asia.
  • Fumigation certificate: This ensures that no pests can enter the destination country through shipping containers. Not required for all shipments, but it is wise to check beforehand.

There are many other specific documents required for specific products like chemicals. Using a knowledgeable freight forwarding company will ensure that your shipment does not get delayed, or even destroyed over something as small as a missing document.