Cost and freight (CFR) is a trade term that requires the seller to transport goods by sea to a required port. Cost, insurance, and freight (CIF) is what a seller pays to cover the cost of shipping, as well as the insurance to protect against the potential damage of loss to a buyer’s order.
Who pays freight in CFR?
The seller pays freight charges in CFR. He stays liable for inland transit from the warehouse to the first port, i.e., the exporting country’s port, and later for the carriage proceeding from the first port to the second port, i.e., the importing country’s port.
What does CFR shipping mean?
Cost and freight (CFR) is a legal term used in foreign trade contracts. In a contract specifying that a sale is cost and freight, the seller is required to arrange for the carriage of goods by sea to a port of destination and provide the buyer with the documents necessary to obtain them from the carrier.
What is CIF shipping term means?
Cost, insurance, and freight (CIF) is an international shipping agreement used when freight is shipped via sea or waterway. Under CIF, the seller is responsible for covering the costs, insurance, and freight of the buyer’s shipment while in transit.
What is FOB CIF and CFR?
A Guide to Shipping Terms and Incoterms. It is important to have an understanding of cost and freight (CFR), cost, insurance and freight (CIF) and Free on board (FOB) . ... The main variance is that under CIF; the exporter or seller is required to provide a minimum value of marine insurance for the products that are shipped ...
What is CFR stand for?
The Code of Federal Regulations (CFR) is the codification of the general and permanent rules published in the Federal Register by the executive departments and agencies of the Federal Government.
Which is better CIF or CFR?
In short, it is the seller who must ensure the goods under CIF , while that responsibility lies with the buyer under CFR. Thus, in broad terms, CIF is generally the safer and more time-effective option for buyers, as it reduces insurance arrangement obligations.
What is difference between CFR and C&F?
All terms are one and no difference while operating . C&F and CFR are widely used terms of delivery in a domestic or international trade. ... Some of the traders use CNF instead of CFR. C&F is used instead of CFR regularly and widely used among business men.
Is CIF and FOB the same?
The abbreviation CIF stands for “cost, insurance and freight,” and FOB means “free on board .” These are terms are used in international trade in relation to shipping, where goods have to be delivered from one destination to another through maritime shipping.
How is CIF calculated?
In order to find CIF value, the freight and insurance cost are to be added. ... Insurance is calculated as 1.125% – USD 13.00 (rounded off) . The total amount of CIF value works out to USD 1313.00. If any local agency commission involved, the same also is added on CIF value of goods – say 2% on FOB – USD 20.00.
What is CIF full form?
A customer information file (CIF) is a system that consolidates customer account information and combines it with basic demographic information to create a current snapshot of a customer relationship.
What is FOB and CIF in shipping?
Meaning: FOB means free on board . The price includes all the expenses incurred until goods are actually loaded on board the ship at port of shipment. CIF stands for cost, insurance and freight. ... CIF price includes free on board and charges of Freight and marine insurance.
What is FOB and CFR price?
FOB (free on board ) and CFR (cost and freight) are Incoterms especific only for maritime transportation and inland waterways. In both cases the transfer of risks from seller to buyer occurs when the goods are loaded on board of the chosen vessel.
Is FCA and CIF same?
An international sale made with FCA INCOTERM favors the seller because the seller has to only deliver the goods to a designated location, determined by the buyer. Whereas in CIF INCOTERM, the seller is obligated to arrange for the contract of carriage up to the buyer’s designated port.
What is CFR full form?
Cost and freight (CFR) and cost, insurance, and freight (CIF) are terms used in international trade for the shipping of goods by sea. CFR requires the seller to arrange for the transport of goods by sea to the buyer’s (required) destination.
