How Containers are Priced

A lot of thought goes into how a shipping line prices a container. When you call for an ocean freight rate quote, you will be asked for the origin, destination and commodity before anything else. Of course origin and destination are taken into account due to days on board, fuel, etc. Shipping companies also take various other factors into account to balance the freight shipping costs, but commodity can really determine the difference in price. The type of cargo determines how the container will be able to fit on a ship. For instance, if someone is shipping a product that is particularly heavy such as ceramic tiles, the shipping line may price it higher because there are less spaces for heavy containers since they need to be loaded in the bottom of the ship. These also take longer to unload since many other containers may be loaded on top of this container so this could be another consideration. There are many established tariffs to follow and whether you are shipping direct with the carriers or indirectly with an NVOCC, rates will be based on following these guidelines.

Another factor for a commodity may be that they require refrigeration or another specialized type of container which will again cost more due to the special needs. If a company has a particularly large item they are looking to ship, they may be looking for an open top to allow for the item to stick out. This then would require a specific place on the ship and therefore would be quoted with taking the other lost spaces into account. This is also true for a flat rack. If the cargo is so large that it will need to ship on a flat rack, all of the neighboring spaces will be taken into account when pricing the cargo.

If it will hang over both sides, then pricing will be more towards 3 container spaces. If it is also too high for a standard container, it would take up 6 container spaces and would be priced as such. Lastly, if the items are particularly heavy, they may need to be loaded on a tween deck which takes up an entirely different area of the ship. Since this space is minimal, rates will tend to be at a higher premium.

The shipping companies generally tend to give the best international shipping prices to the commodities that are easiest to load and have the smallest amount of considerations. They also tend to price the ports the same way. The easier the access to the port and with the least amount of concerns, the less people they need to have available, and the better pricing the ocean shipping carriers are able to give. The only other consideration may be a high enough volume in a trade lane to make it worthwhile the carrier to create a new rate just for a specific shipper’s containers. This is for the extremely large amounts by larger companies and shipper’s associations so they can create contracts just for one specific type of cargo in a trade lane. If you can get in on this type of contract, your rates will be generally lower.

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