Container shipping makes our reality possible. And that’s not an overstatement. Take a look around you and think about how many of the things you see have been made locally. Was the phone, tablet, or laptop you use to read this article produced someplace nearby, or was it produced in a far-away country? Was the chair you're sitting in produced in your country? How about the clothes you wear?
Chances are, most of these products were mass-produced somewhere distant and shipped to a store near you. And the most common way to ship things to far-off countries is by using containers. Which might get you wondering: How much does it cost to ship a container overseas? Read on to find out.
The History Of Container Shipping
Even though it might seem like a modern concept, international shipping was first recorded in ancient history, probably as early as the 19th century BCE. There are historical records showing that the peoples living around the Mediterranean Sea traded with one another, and that the Silk Road enabled trade between the Ancient Chinese and the Roman Empire.
International trade continued to improve through the Middle Ages and especially the Early Modern era, when European explorers sailed around the world looking for spices and other valuable goods. But it wasn’t until 1956 that the shipping industry started using containers to improve loading and unloading times and lower operational costs. Modern containers are the result of several compromises made by the US and the EU to create an international shipping standard, and the dimensions you’re familiar with entered the market in 1968.
Thanks to their standardized size, modern containers can be easily loaded and unloaded from a ship. Their size and build also make it possible for them to be loaded on trucks or trains and be transported overland without having to open them. Thanks to modern containers, the shipping process is also safer. The containers are sealed by the shipper and their seal is not broken until they reach their destination.
Different Types Of Containers
Even though you might be familiar with the 20-foot and 40-foot containers, they aren’t the only types of containers that can be shipped internationally. Here are the most common types of containers used in international trade and their dimensions :
3. 40 Feet High Cube (HC) Dry Container
4. 20 Feet Refrigerated Container (RF)
5. 40 Feet Refrigerated Container (RF)
6. 20 Feet Open Top Container (OT)
7. 40 Feet Open Top Container (OT)
8. 20 Feet Flat Rack Container (FR)
9. 40 Feet Flat rack Container (FR)
10. 40 Feet High Cube Flat Rack Container (FR)
What Could Fit In A Shipping Container?
Knowing a shipping container’s dimensions is important, but it doesn’t really help you imagine how spacious a container really is. So let’s take a look at what you could fit in common shipping containers.
20 Feet Container
It’s estimated that a 20-foot container could hold all the contents of a three-bedroom house, including all the furniture, electronics, storage boxes, and personal belongings. With a total capacity of 33 cubic meters, a 20 ft closed container is large enough to hold each of the following group of items:
- Up to 60 refrigerators (depending on the model)
- About 200 full-sized mattresses
- Up to 100 washing machines (depending on the model)
- 10 standard pallets or 12 Euro pallets filled with boxes but without stacking them
- About 48,000 bananas
- About 12,000 teddy bears
40 Feet Container
A 40-foot container offers double the space of a 20-foot one, so it's estimated that it would fit all the items in a four-bedroom house, including furniture, electronics, clothes, personal belongings, bicycles, scooters, etc. With a total capacity of 67.7 cubic meters, a 40 feet container could hold each of the following group of objects:
- An excavator
- Between 2 - 4 cars, depending on the model
- About 100,000 bananas
- 20 standard pallets or 24 Euro pallets without stacking them
Most Commonly Used INCOTERMS (International Commercial Terms)
Given the different dimensions and weights of the various shipping containers, their handling and shipping costs will also be different. But the container’s origin and its destination will also affect the shipping price.
As you can imagine, shipping a container over 1,000 miles will cost less than shipping it over 3,000 miles. Shipping a container to a location near a port will cost less than shipping it to a location that’s far from a port, which would mean that the container would also have to travel by rail or by truck to reach its destination.
But the final cost of shipping can also be influenced by the shipment’s INCOTERMS. International Commercial Terms, or INCOTERMS for short, express the relationship between the buyer and the seller, and they also mention who is responsible for the shipment transport during its transit. INCOTERMS also establish who assumes the risk of the cargo in case the shipment is partially or completely damaged.
Here are some of the most commonly used INCOTERMS used in the international shipping industry:
Free Carrier (FCA)
Free Carrier means that the shipper is responsible for the delivery of the goods into the custody of a party named by the buyer. The shipper is no longer responsible for anything that might happen to the goods from that point forward, so the buyer is responsible for the cost of transportation and covers the risk for the goods for the remainder of the transport.
Free On Board (FOB)
Free On Board indicates that the shipper is responsible for the transportation cost as well as the risk as long as the cargo is on board of a vessel or an airline. Once the cargo is unloaded, it becomes the responsibility of the buyer.
Free Alongside Ship (FAS)
Free Alongside Ship indicates that the seller is responsible for the delivery and the shipping risks until the cargo is unloaded alongside the ship. Once the cargo is unloaded, the seller’s responsibility ends and the buyer bears all the responsibility and carries the costs from that point forward.
EXW is a shipping term that indicates that the buyer is responsible for collecting the cargo from the shipper’s location once the cargo has been loaded on board of a truck. Both the transportation costs and the risk are supported by the buyer once the cargo has been collected.
Delivery Duty Paid (DDP)
DDP indicates that the seller is responsible for delivering the goods to the seller, including clearing the products for export and import, as well as paying any customs duties and carrying out the customs formalities.
Delivered At Terminal (DAT)
Delivered at Terminal is a commercial shipping term indicates that the seller is responsible for delivering the cargo at a mutually-agreed terminal in the designated port of destination. The seller bears all the risks involved in delivering and unloading the cargo at the specified terminal.
Delivered At Place (DAP)
DAP indicates that the seller is responsible for delivering the goods to a previously-agreed destination. This term also indicates that the seller assumes all the risk involved in delivering the goods, and is responsible for unloading the goods at their destination.
Cost & Freight (CFR)
Cost & Freight term indicates that the seller has to deliver the cargo to the destination agreed with the buyer, whether this destination is a port or an airport. The seller is responsible for all the freight charges as well as the risk until the cargo reaches its destination.
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