Freight Glossary

Additional charges for services beyond standard pickup, line-haul, and delivery, such as waiting time, inside delivery, or tail-lift use.

The contract of carriage for air freight. Unlike a negotiable bill of lading, an air waybill is not a document of title. Used with airline and freight forwarder air shipments.

A quoted freight rate that bundles the base rate and all applicable surcharges into a single figure, rather than listing them separately.

An additional import duty imposed on specific goods from specific countries that are found to be sold below normal value and to injure the importing country's domestic industry.

A notification sent by the carrier or forwarder to the consignee and notify party shortly before or on arrival of a shipment, listing charges due and the steps needed to take delivery.

A status granted by a customs authority to traders that meet security and compliance standards, giving them faster clearance and fewer inspections.

A fuel surcharge applied to ocean freight rates to reflect changes in bunker (fuel) costs. Fluctuates with oil prices and is added to base ocean freight.

A legal transport document issued by a carrier acknowledging receipt of cargo for ocean shipment. It serves as a receipt, contract of carriage, and document of title (depending on type). Required for customs and bank documentation.

A scheduled vessel departure that a carrier cancels, either skipping a port call or omitting the voyage entirely.

A customs-approved facility where imported goods can be stored without duty and import taxes becoming payable until they are released into the domestic market.

General cargo loaded individually onto a vessel rather than in containers or as free-flowing bulk, typically as crates, drums, bags, or bundles.

A surcharge that adjusts ocean freight rates for exchange-rate movements between the currency a rate is quoted in and the carrier's operating currencies.

Insurance covering loss or damage to goods in transit. Carrier liability is limited by convention; shippers often buy all-risk cargo insurance separately from freight charges.

A unit of volume used to price LCL ocean freight and calculate chargeable weight. Calculated as length × width × height in metres.

A document evidencing that cargo insurance is in place for a specific shipment, stating the sum insured, the cover conditions, and where claims are to be presented.

A document certifying the country where goods were manufactured or obtained. May be required to claim preferential duty rates under free trade agreements.

An Incoterm where the seller pays costs and freight to bring goods to the named port of destination. Risk transfers when goods are on board at the port of shipment. Insurance is the buyer responsibility unless agreed otherwise.

The weight used to calculate air freight charges — the greater of actual gross weight or volumetric weight (volume ÷ dimensional factor, commonly 6000 for air).

An Incoterm where the seller pays for cost, insurance, and freight to the named port of destination. Risk transfers when goods are on board at the port of shipment. The seller must procure minimum marine insurance for the buyer.

An Incoterm for any transport mode where the seller pays carriage to the named destination and must provide all-risks cargo insurance for the buyer. Risk transfers at handover to the first carrier.

An unbroken temperature-controlled supply chain that keeps perishable or sensitive goods within a specified range from origin to destination.

A document stating the seller and buyer, description of goods, quantity, unit price, total value, currency, and Incoterm. Customs authorities use it to assess duties and verify shipment contents.

A charge applied when a port or terminal is congested, covering the carrier's additional costs from vessel waiting time and disrupted schedules.

The party named in transport documents to receive the goods at destination. Often the buyer or importer responsible for import clearance unless terms state otherwise.

The party shipping the goods — typically the seller or exporter named as shipper on transport documents.

A facility where LCL consignments from multiple shippers are consolidated into containers for export, and deconsolidated on import.

The area of a terminal or depot where full and empty containers are stacked and stored while awaiting loading, collection, or return.

A freight rate agreed between shipper and carrier for a defined period and volume, giving price stability and usually a space commitment.

An Incoterm for any transport mode where the seller contracts and pays for carriage to the named destination, but risk transfers to the buyer when the goods are handed to the first carrier.

A shipment where seller and buyer are in different countries and cargo moves directly between two other countries without passing through the forwarder home country.

A distribution method where inbound goods are transferred directly to outbound vehicles with little or no storage in between.

A financial guarantee ensuring that duties, taxes, and penalties owed to customs will be paid, required for many import operations and for moving goods under customs control.

A licensed specialist who files customs entries and arranges clearance on behalf of importers and exporters. Freight forwarders often provide customs brokerage as part of their service.

The process of obtaining permission from customs authorities to import or export goods. Involves document submission, declaration, inspection if required, and payment of duties and taxes.

The deadline by which cargo, documentation, or the VGM declaration must reach the carrier or terminal to be accepted for a given sailing.

Cargo classified as hazardous under IMDG (sea) or IATA (air) regulations — including batteries, chemicals, aerosols, and flammable items. Requires special packaging, labelling, documentation, and carrier approval.

An Incoterm where the seller delivers when goods are placed at the buyer disposal at the named destination. The buyer handles import clearance and pays import duties unless contractually agreed otherwise.

An Incoterm where the seller delivers goods to the buyer at the named destination, cleared for import, with all duties and taxes paid. Maximum seller obligation; common when buyers want a door-to-door quoted price.

The shipment value below which a country waives import duty and sometimes tax, allowing low-value consignments to clear with minimal formality.

A document issued by the carrier or their agent instructing the terminal or depot to release a specific consignment to a named party once all charges and documentation requirements are satisfied.

A penalty charge when a full container remains at the port or terminal beyond the agreed free time after arrival. Distinct from detention, which applies to equipment held outside the port.

A charge when a shipper or consignee holds a carrier container outside the port or depot beyond the allowed free days. Applies to equipment use, not port storage.

A service where the provider manages the entire journey from the shipper's premises to the consignee's premises, including all legs and formalities.

An Incoterm for any transport mode where the seller bears cost and risk to the named destination and must also unload the goods there. It replaced DAT in Incoterms 2020.

The short-distance road movement of a container between a port, rail terminal, depot, and the shipper or consignee's premises.

Material placed around cargo to secure it, absorb shock, and prevent movement or moisture damage during transport.

A refund of import duty already paid on goods that are subsequently re-exported, either unchanged or after being incorporated into an exported product.

The carrier's projected date and time for a vessel, aircraft, or vehicle to arrive at a specified port or destination.

The carrier's projected date and time for a vessel, aircraft, or vehicle to depart from a specified port or origin.

An Incoterm placing minimum obligation on the seller — goods are made available at the seller premises. The buyer bears all costs and risks from collection, including export clearance unless otherwise agreed.

A sea and inland waterway Incoterm where the seller delivers the goods alongside the vessel at the named port of shipment, and risk transfers at that point.

An Incoterm where the seller delivers goods to the carrier or person nominated by the buyer at the named place. Suitable for all transport modes and often used instead of FOB for containerised cargo.

A container booked exclusively for one shipper cargo. Common sizes are 20ft and 40ft standard or high-cube. Cost-effective when cargo fills most of a container.

A unit of container capacity based on a forty-foot container. One FEU equals two TEU.

A container with a base and two collapsible or fixed end walls but no sides or roof, used for cargo too wide, tall, or heavy for a standard box.

An Incoterm where the seller delivers goods on board the vessel at the named port of shipment. Risk and cost transfer to the buyer once the goods are loaded. The buyer typically arranges ocean freight and insurance from that point.

The period allowed for using or holding a container without incurring demurrage or detention, counted from discharge or from collection.

A treaty between two or more countries that reduces or removes tariffs and other barriers on qualifying goods traded between them.

A payment term where the consignee pays the freight charges at destination, before the cargo is released.

An intermediary that organises international shipments on behalf of shippers — booking carriers, preparing documentation, arranging customs, and coordinating door-to-door logistics without typically owning vessels or aircraft.

A payment term where the shipper pays the freight charges at origin, before or at the time of shipment.

Road freight where a shipper books an entire trailer, which travels directly from collection to delivery without consolidation.

A carrier-announced across-the-board increase to freight rates on a trade lane, applied from a stated effective date.

An air waybill issued by a freight forwarder or consolidator to an individual shipper, covering that shipper's consignment within a larger consolidated shipment.

A container one foot taller than standard, giving roughly 9 feet 6 inches of external height and around 13 percent more internal volume.

A bill of lading issued by a freight forwarder or NVOCC to the shipper. Used when cargo is consolidated or when the forwarder acts as intermediary between shipper and main carrier.

Harmonised System code used worldwide to classify goods for customs duties and trade statistics. The first six digits are harmonised globally; countries add further digits for national classification.

International Commercial Terms published by the ICC. Incoterms define who pays for transport, insurance, and customs, and when risk transfers from seller to buyer in international trade. The current rules are Incoterms 2020.

Movement of goods using two or more transport modes in the same loading unit, with the unit itself transferred rather than the cargo inside it.

A cylindrical tank mounted in a standard container frame, used to carry bulk liquids, gases, and powders in the intermodal system.

A security surcharge recovering the cost of compliance with the International Ship and Port Facility Security Code at ports and terminals.

The final leg of a shipment, from the last distribution point to the end recipient's address.

Cargo that does not fill a full container and shares space with other shippers cargo, consolidated at a container freight station. Priced per CBM or weight, whichever is higher.

Road freight where a shipment occupies part of a trailer and shares space with consignments from other shippers.

A bank undertaking to pay the seller once they present documents that comply exactly with the credit terms, used to secure payment between parties who do not know each other well.

The bill of lading issued by the ocean carrier (shipping line) for the entire shipment, often covering multiple house bills in LCL consolidations.

The air waybill issued by an airline to a freight forwarder, covering an entire consolidated shipment that may contain many individual consignments.

Carriage by at least two different modes under a single contract and one transport document, with one operator responsible for the entire journey.

A party listed on the bill of lading to be informed when cargo arrives at destination. Often a broker, agent, or buyer representative; not necessarily the consignee.

Non-Vessel Operating Common Carrier — a freight forwarder that issues its own bills of lading and consolidates cargo like a carrier without owning ships. Common in ocean freight.

A container with a removable tarpaulin roof instead of a solid one, allowing cargo to be loaded from above by crane.

Cargo whose dimensions exceed the internal or external envelope of a standard container, protruding in height, width, or length.

A statement confirming whether a consignment contains timber or other regulated packing materials, required by biosecurity authorities in countries such as Australia and New Zealand.

A document itemising the contents, dimensions, and weight of each package in a shipment. Must align with the commercial invoice for customs clearance.

A temporary surcharge applied during periods of high demand, when carriers face capacity constraints on a trade lane.

The port where cargo is unloaded from the vessel. Not to be confused with proof of delivery in last-mile logistics — context determines meaning.

The port where cargo is loaded onto the vessel for ocean export. Named on the bill of lading and used in transit time and Incoterm calculations.

A preliminary invoice issued before shipment that sets out the goods, price, and terms, used by the buyer to arrange payment, financing, or an import licence.

Large, heavy, high-value or complex consignments — typically industrial plant and equipment — that require bespoke engineering, routing, and handling.

A signed or electronically captured record confirming that a consignment was delivered to the recipient, with date, time, and condition noted.

A refrigerated shipping container with an integral cooling unit that maintains a set temperature range for perishable or temperature-sensitive cargo.

A vessel and shipping method where wheeled cargo is driven on and off the ship under its own power or on a trailer, rather than being lifted by crane.

Cargo that was booked and delivered for a specific sailing but not loaded, and is carried forward to a later vessel.

The criteria that determine which country a product is deemed to originate from, deciding whether it qualifies for preferential duty rates under a trade agreement.

A non-negotiable transport document that evidences the contract of carriage and receipt of goods but is not a document of title, so no original needs to be surrendered to collect the cargo.

The party that tenders cargo to the carrier or forwarder for transport. On documents may be the exporter, manufacturer, or freight forwarder acting on their behalf.

The formal set of details a shipper sends the carrier or forwarder to have the bill of lading drawn up, covering parties, cargo description, marks, weights, and freight terms.

A freight rate quoted for immediate or near-term shipment at prevailing market prices, without a longer-term volume commitment.

A second set of bills of lading issued to replace the originals, typically to conceal the true supplier or origin from the end buyer in a cross-trade transaction.

The weight of an empty container, vehicle, or packaging, excluding the cargo it carries.

A tax levied on imported goods, usually calculated as a percentage of customs value and determined by the goods' HS classification and country of origin.

An electronic release of cargo at destination without surrendering an original bill of lading. Speeds up delivery when originals are impractical, subject to carrier and payment terms.

A standard measure of container capacity. One 20ft container equals 1 TEU; a 40ft container equals 2 TEU. Used to describe port throughput and vessel capacity.

Fees charged by the port or terminal for loading, unloading, and handling containers or cargo. Applied at origin and/or destination and often listed separately from ocean freight.

A provider that manages outsourced logistics functions such as warehousing, transport, fulfilment, and freight forwarding on a client's behalf.

The time from departure at origin to arrival at destination port or door. Port-to-port transit excludes customs, consolidation, and inland legs unless quoted door-to-door.

When cargo is unloaded at an intermediate port and reloaded onto another vessel to reach the final destination. Adds transit time but enables more routing options.

The certified total weight of a packed container required under SOLAS before loading on a vessel. Shippers must provide VGM to the carrier; inaccurate VGM can result in fines or loading refusal.

A notional weight derived from a shipment's dimensions using a carrier's conversion factor, used when cargo occupies more space than its actual weight justifies.

A surcharge applied to shipments routed through areas designated as high risk due to conflict, piracy, or political instability.