"In export negotiations, when the requirements of the export commodities are clear, the important condition for the success of the transaction lies in whether the offer is reasonable or not; in the various indicators of the offer, in addition to costs, expenses and profits, there is also a very important factor is the freight rate.
Calculation of freight for the whole box for the whole box consignment of container goods freight charges: a method is the same as the LCL goods, according to the actual freight tonne billing. The other method, which is also more common at present, is to charge the freight according to the type of container.
In the case of a full container consignment and the container used is owned by the shipping company, the carrier has the right to charge the freight according to the "Container Minimum Utilisation" (COntainer Minimum Utilization) and "Container Maximum Utilisation" (Container Maximum Utilisation). Container Maximum Utilisation" (Container Maximum Utilization) to pay ocean freight.
Calculation of Container Minimum Utilisation
l?What is Minimum Utilisation
Generally speaking, the liner conferences usually only calculate the tonnage of the goods loaded in the container when charging the ocean freight for containers, and do not charge for the weight or volume of the container itself, but there is a minimum requirement for the utilisation rate of the container load, i.e. the "Minimum Utilisation Rate".
The main purpose of the minimum utilisation rate
The main purpose of the minimum utilisation rate of the container is that if the tonnage (weight or volume) of the loaded goods does not meet the specified requirements, the freight rate will still be calculated according to the minimum utilisation rate of the corresponding billable tonnes, in order to ensure that the interests of the carrier. In determining the minimum utilisation of a container, the weight or volume of the pallets is usually included. The size of the minimum utilisation depends mainly on the type and size of the container and the business strategy followed by the container liner. Of course, in the rate schedules of some liner conferences, the minimum utilisation rate of a container is usually related to the size of the box only, regardless of the type of container.
Forms of minimum utilisation-based freight rates
At present, there are three main forms of charging freight on the basis of minimum utilisation of containers: minimum loading tonne, minimum freight rate and a mixture of the above two forms. l?
The minimum loaded tonne can be either a weight tonne or a volume tonne, or a percentage of the container's loading capacity (deadweight or volume). The minimum loading tonnage expressed in terms of weight or volume tonnes usually varies according to the type and size of the container, but in some cases it can be the same. When the minimum loading tonnage is determined as a percentage of the container's loading capacity, the percentage is usually the same for both the container's weight capacity and volume capacity, but of course it can be different.
The minimum freight rate is a minimum amount of freight per tonne or per container, of which the latter is also known as the "minimum package freight rate".
As for the mixed form of the above two forms, the minimum container utilisation rate is determined according to the following methods:
(i) A percentage of the container's weight capacity or volume capacity plus a minimum freight rate per unit volume of container or per container;
(ii) Minimum weight tonnes or volume tonnes plus a certain percentage of the container's volumetric capacity.
Calculation of Lost Container Freight
When the total weight or volume of the goods loaded in the container fails to meet the minimum weight tonnes or volume tonnes, resulting in under-utilisation of the container's loading capacity, the cargo owner will pay a loss of container freight. Lacking freight is actually the freight charged for the under-billed tonnes, i.e., the difference between the specified minimum billable tonnes and the actual quantity of cargo loaded.
In calculating the deadweight freight, the highest rate of the cargo contained in the container is usually taken as the basis for calculation. In addition, when the minimum container utilisation rate is expressed in the form of the "minimum package freight rate", if the freight rate obtained by multiplying the number of tonnes of cargo loaded in the box and the basic rate, plus the relevant surcharge, is still lower than the minimum package freight rate, the freight rate will be charged according to the latter.
Calculation of Maximum Container Utilisation
What is the maximum utilisation rate?
The meaning of the maximum utilisation rate of a container is that when the volume tonnes of the goods carried in the container exceeds the specified volume loading capacity of the container (the container's internal volume), the freight rate will be charged according to the specified container's internal volume, which means that the exceeding portion of the freight rate is exempted from charging.
l?Freight rate charged at the highest utilisation rate
If there is only one rate class for the goods in the box, the freight will be charged according to that rate; if the box contains different classes of goods, the following two practices are usually adopted when charging freight:
One is that all goods in the box are charged at the rate applicable to the highest rate class of goods in the box;
The other practice is to calculate the freight according to the rate, from the higher rate to the lower rate, until the total volume tonnes of the goods are equal to the specified container volume. It should be noted that if the owner of the goods fails to make a detailed declaration of the contents of the box as required by the carrier, the freight is charged on the basis of the contents of the container and the rate is based on the highest rate applicable to the goods in the box. If only a portion of the contents of the box is not declared, then the freight for the undeclared portion is charged on the basis of the difference in tonnes between the contents of the box and the declared freight tonnes of the goods.
Purpose of Maximum Utilisation Rate
The main purpose is to encourage cargo owners to use containers for shipment of goods and to be able to maximise the utilisation of the container's internal volume. For this reason, in the container shipping freight calculation, the shipping company usually for a variety of specifications and types of containers provide a container content area converted to the maximum utilisation rate.
For example, the maximum utilisation rate of a 20ft container is 31 cubic metres, while the maximum utilisation rate of a 40ft container is 67 cubic metres. The reason why the maximum utilisation rate is calculated in terms of volume tonnes rather than weight tonnes is that each container has a maximum capacity and overweighting is not permitted in transport. Therefore, under normal circumstances, there should be no overweight containers, let alone encouraging the practice of overweighting.
Calculation of LCL Freight
LCL freight calculation mainly adopts "W/M" method. Usually, the freight tonnage of cargo is divided into weight tonnage (W) and size tonnage (M). According to the gross weight of the commodity, 1000kg is 1 weight ton; 1 cubic metre is 1 foot ton; the billing standard "W/M" means to choose the greater of the weight ton and the foot ton of the commodity to be billed. In theory, the default unit rate is fixed, and the solution only considers the comparison of the single variable of freight tonnes.
But in practice, different freight forwarders give the LCL rate by weight tonnes and size tonnes are often not the same, in this case we have to consider the double variables, according to different rates, freight tonnes combined calculation and then compared.
For example, a commodity weight 5 tonnes, volume 8 cubic metres, "W / M" rate is USD100/60, then the final total freight can not only look at the comparison of W and M, but 5 x 100 and 8 x 60 comparison, and finally charge USD500 according to the total amount of the higher weight tonne rate.
