A freight quotation of one number is almost never one number. Buyers who compare a CFR offer from one exporter against a CFR offer from another, without asking what sits inside each, routinely find several hundred dollars of difference appearing at the destination terminal. Here is how a reefer quote out of Egypt is actually built, and which questions expose the gaps.

The base rate

The base ocean freight covers carriage of the container from the load port to the discharge port for the vessel’s account. It is quoted per container rather than per tonne, so the more payload you put inside the box, the lower the freight cost per carton. That is why VGM planning matters commercially and not only for compliance, a point we cover in the note on container weight and VGM on Egyptian produce exports.

Base rates are quoted with a validity period, commonly seven to thirty days, and almost always subject to space and equipment availability. A rate confirmed three weeks ago is not a rate you hold today unless it was fixed in a contract.

The surcharges attached to the sea leg

The bunker adjustment factor moves with fuel prices and is revised monthly or quarterly by most lines. A low sulphur or emission control surcharge may appear separately depending on the trade lane. The currency adjustment factor appears on some lanes where the rate is quoted in a currency other than the line’s accounting currency.

Reefer containers carry their own charges. There is normally a plug or electrical supply charge at the terminal and on board, a charge for temperature monitoring and data provision, and a further charge if controlled atmosphere is specified. Peak season surcharges appear on lanes and in weeks where demand outruns capacity, which on Egyptian citrus means the winter programme. Congestion surcharges and war risk or routing surcharges appear when conditions require, and routing conditions in the region have been unsettled enough in recent years that this line should never be assumed away.

Charges at the load port

Origin terminal handling covers the movement of the container inside the Egyptian terminal. Alongside it sit the documentation or bill of lading fee, the seal fee, the VGM submission fee, export customs clearance, the phytosanitary inspection fee, and inland haulage from the packhouse to the port. Port choice affects several of these, and the trade-offs between Alexandria, Damietta, Port Said and Sokhna are set out in our comparison of Egyptian export ports.

Charges at the discharge port

This is where most CFR comparisons come apart. Destination terminal handling, the import documentation fee, any container cleaning or maintenance charge and the destination security fee are frequently outside a CFR price, because whether they fall to the carrier or the receiver depends on the liner terms agreed on the bill of lading. Ask explicitly whether the quote is liner in liner out, and ask for the destination charges in writing even when they are not your account, so that you can build them into your landed cost.

Import duty, VAT and customs brokerage are always the importer’s cost under CFR, CIF and CFR-like terms. Marine insurance is included only under CIF and CIP.

Free time and what it costs when it runs out

Every quote carries a free time allowance at destination, usually stated separately for demurrage inside the terminal and detention of the equipment outside it. Reefer free time is typically shorter than dry free time, sometimes only three to five days, and the daily charge after it expires is high because the box is expensive and the plug is occupied. Confirm the number of free days in the quotation itself, not in conversation.

Five questions to ask on every quote

Ask what the validity period is and whether space is confirmed or indicative. Ask which surcharges are included and which will be invoiced separately. Ask whether destination terminal handling is inside the price. Ask how many free days apply at destination and what the daily rate is afterwards. Ask what the transhipment routing is, because a direct service and a two-leg service can carry the same headline rate and very different arrival risk.

Booking discipline solves several of these problems before they arise, and the seasonal lead times are set out in our guide to booking reefer space for the Egyptian citrus season.

Send us the destination port, the product, the monthly container count and your preferred Incoterms 2020 basis, and we will quote with the surcharge breakdown attached rather than as a single figure. WhatsApp the export desk on +20 10 9911 1918.