One of the most crucial choices businesses must make when transporting goods between countries is the selection of the appropriate mode of transport. Sea freight export can be one of the most viable and affordable means of transport for larger volumes, heavier cargo, commercial goods, non-time-sensitive machinery, raw materials and products.
A sea freight is an important part of global trade since many centuries and in the present day most of the international trade goods move in seas. Sea freight links manufactures, suppliers, distributors and customers in international markets such as from an Australian agricultural goods container to Asia, and from Australia to the Middle East for exporting machinery.
So, what exactly does sea freight export entail? How do you do it? What paperwork needs to be submitted? What is the price? So what are businesses to think about before shipping goods overseas by sea?
Think Global Logistics (TGL) discusses all about sea freight export and how businesses can make it more efficient, transparent and reliable.
What Is Sea Freight Export?
Sea freight export involves sending products from one country to another via sea. Goods are arranged, bundled or placed in shipping containers at the point of origin and shipped by sea to the end or destination port.
Once the vessel arrives at the destination, the cargo goes through the relevant import customs and clearance procedures before being delivered to its final destination.
For companies that require to move:Sea freight is especially well suited to:
- Significant amounts of products
- When cargo is too heavy or too big.When cargo is too heavy or too large.
- Machinery and equipment
- Raw materials
- Commercial inventory
- Vehicles
- Furniture
- Construction materials
- Agricultural products
- Industrial equipment
- Items that are not very time-sensitive
Sea freight is typically slower than air freight, but often is a more economical choice for heavy loads.
If you export or import products regularly, it is crucial for your business to know the basics of sea freight to save money, avoid unnecessary delays and plan your supply chain.
How Does Sea Freight Export Work?
There are various stages to the sea freight export process. While the exact process can vary depending on the cargo, destination, origin country and shipping requirements, a typical export shipment follows a process similar to this:
Request a Freight Quote
The first step is to give details regarding the shipment to your freight forwarder.
This normally includes:
- Origin location
- Destination port
- Type of goods
- Number of cartons or pallets
- Dimensions
- Total weight
- Cargo value
- Required shipping date
- Special handling requirements
- In case of FCL or LCL shipment.
The closer the information given at this stage is to the truth, the closer the freight quotation will be to the truth.
A professional freight forwarder will then be able to evaluate the options of shipping and advise on the best.
Choose Between FCL and LCL
Whan exporting by sea, one of the primary choices you must make is the type of shipment, either FCL or LLS.
What Is FCL?
Full Container Load (FCL) is a term used for shipments that require a full container.
FCL is a shipping service that allocates an entire shipping container to your business. It can be full or half full but it’s for your shipment only.
These are typical sizes of containers:
- 20-foot containers
- 40-foot containers
- 40-foot high-cube containers
FCL may be a desirable choice if you have a sufficient volume of cargo that warrants the utilization of an entire container, or you prefer to exercise more control over your shipment.
What Is LCL?
LCL also is referred to as Less than Container Load.
If it does not need a complete container, your cargo can be combined with the goods of other businesses.
Rather than the price of a whole container, you often pay for the space that your cargo takes up.
If the exporter is less than a full container load, LCL can be extremely helpful.
A freight forwarder can be able to decide which is the best option: FCL or LCL, depending on the volume of cargo, destination, and budget.
Prepare the Cargo for Export
The preparation of the cargo is crucial.
Goods must be protected during the transportation process by being packaged appropriately. Keep in mind that a ocean freight shipment may be put through vibrations, handling, movement, temperature change, humidity and the environment.
Exporters can utilize:
- Cartons
- Pallets
- Crates
- Wooden cases
- Protective wrapping
- Strapping
- Dunnage
- Special industrial packaging
Large machinery and larger loads can be a problem: special loading and securing may be necessary.
Wrongly packaged products can lead to product damage and cost and sometimes lead to delays.
Accordingly, exporters should think about the goods’ appearance after they have left the warehouse, but also the whole journey that they will undergo.
Complete Export Documentation
One of the key aspects of international shipping is documentation.
A lack of accurate or complete records may result in customs problems, delays, and extra costs.
Depending on the shipment and destination, the following may be required:
- Commercial invoice
- Packing list
- Bill of lading
- Certificate of origin
- Export permits
- Customs declarations
- Insurance documentation
- Documentation of dangerous goods, if applicable.
- Other certificates or permits issued for a destination or purposes (see “Conditions” below)
The detail of the necessary documentation will vary depending on the nature of the goods, and the countries involved.
That’s one of the advantages of employing a skilled freight forwarder to help with the export process.
Customs Clearance
Sometimes, goods must be cleared by the relevant customs authority prior to export.
Customs authorities require information regarding the goods, such as their description, value and place of origin and destination.
Businesses must make sure that the descriptions and commodity classifications are correct.
Customs delays are not desirable when there is a mistake in customs documentation.
Customs compliance must not be an add-on for exporters. It should be included from the start in the shipment planning process.
Cargo Is Delivered to the Port
When the goods are in order and all the necessary export formalities are fulfilled, they are sent to the relevant port.
Arranging transport to the port is up to the exporter, either himself or his freight forwarder, depending on the arrangement.
This is where using a single logistics partner can make the shipment easier.
For instance, Think Global Logistics (TGL) can organize various aspects of the supply chain, which means that businesses do not have to deal with each logistics provider individually.
The Cargo Is Loaded Onto the Vessel
Upon arrival at the port and completion of all the requirements, the container is put on the specified vessel.
Then, the vessel starts towards the destination country.
The transit time will vary significantly according to the origin and destination, shipping route, vessel’s schedule, and other operational conditions.
Therefore, companies need not to build their supply chain on the assumption of a transit time only. The delivery time can be influenced by port congestion, weather conditions, vessel schedules, customs procedures and more.
Arrival at the Destination Port
Once the ship arrives at the port of destination, the container will be unloaded and the import procedure will be initiated.
The importer may have to:
- Lodge import documentation
- Complete customs clearance
- Make payment of applicable duties and taxes.
- Coordinate biosecurity/inspection needs
- Organise port or terminal charges
- Organize transport to destination
After being cleared, cargo may be picked up or dropped off.
This does not mean that the sea freight journey ends once the ship arrives to the destination port. The last part of the chain is significant as well.
What Are the Advantages of Sea Freight Export?
Sea transport is still vital around the globe for a good reason.
Cost-Effective for Large Shipments
The biggest advantage of the sea freight is its cost efficiency.
Sea freight may often be far more cost effective than air freight when businesses are moving large volumes of goods.
Transportation expenses are a more significant part of the profitability of a business as the size of the shipment increases
Suitable for Heavy Cargo
Sea freight is especially suited for bulky commodities.
Sea transport is often more economical for industrial machinery, construction equipment, vehicles and other large gear.
This means the shipping via sea would be a vital choice for companies in manufacturing, construction, mining, auto industries, and industrial fields.
Large Cargo Capacity
Large ships can carry lots of cargo.
There is a large capacity in each container and thousands of containers can be loaded onto large vessels.
This is a significant benefit for companies that need to transport large quantities of goods overseas.
Suitable for Many Types of Goods
A variety of cargo can be transported via sea.
Standard containers, refrigerated containers, open-top containers, flat racks and other special equipment can be used for the export of goods, depending on the type of goods.
This means that ocean freight is an option for all sorts of goods, ranging from consumer goods to large machinery.
Better for Non-Urgent Shipments
Not all shipments have to reach in a few days.
Sea freight may be a cost-effective and efficient mode of transport if your business has sufficient planning of inventory and your products are not time-sensitive.
What Are the Disadvantages of Sea Freight?
Sea freight is a great mode of transport, but it isn’t suitable for all packages.
Longer Transit Times
Sea freight generally takes longer than air freight.
For urgent products, critical spare parts or critical goods, air freight might be more suitable.
Potential Port Delays
There may be congestion, disruption of operation, and changes in schedules at ports.
Documentation Requirements
There is a considerable amount of paperwork and regulatory requirements with international shipping.
Additional Charges
It’s important to note for businesses that the ocean freight rate is not necessarily the total logistics cost.
There can be additional expenses associated with:
- Terminal handling
- Customs clearance
- Documentation
- Port charges
- Storage
- Demurrage
- Detention
- Delivery
- Inspection
- Duties and taxes
A competent freight forwarder will be able to provide explanations of costs involved prior to the shipment.
How Much Does Sea Freight Export Cost?
Sea freight does not have a fixed cost.
There are several factors that influence the cost, such as:
All of the above plus additional factors such as Origin, Destination, Cargo Volume, Weight, Shipping Line, Season, Port Charges, Customs, Delivery Requirements, etc.
Prices are usually based on the type of container and route for FCL shipments.
For LCL shipments, costs can depend on factors such as the cargo volume and weight.
In addition, it is important to differentiate the ocean freight rate from the overall landed logistics cost for the business.
A low headline freight rate doesn’t always translate to a low overall rate if the additional charges are high.
We don’t believe in hidden costs and believe transparency in pricing is important to good logistics management. Before businesses make shipping decisions, they should be aware of what they are buying and any freight charges that may apply.
What Is a Bill of Lading?
One of the most important documents in sea freight is the Bill of Lading or B/L.
It includes information about the shipment, and serves as proof of the contract of carriage between the parties concerned.
The Bill of Lading may include information such as:
- Shipper
- Consignee
- Notify party
- Description of goods
- Quantity
- Container number
- Port of loading
- Port of discharge
- Vessel details
- Shipping terms
The Bill of Lading is one of the key shipping documents, so exporters should ensure that the information in the document is correct prior to finalisation.
Even slight documentation mistakes can cause problems later in the shipment.
Incoterms and Sea Freight Export
Another significant factor to take into account is Incoterms.
Incoterms establish obligations of buyers and sellers in international trade, such as transportation costs, risk and delivery obligations.
Common Incoterms include:
- EXW – Ex Works
- FCA – Free Carrier
- FOB – Free on Board
- CFR – Cost and Freight
- CIF – Cost, Insurance and Freight
- DAP – Delivered at Place
- DDP – Delivered Duty Paid
Under FOB, the seller usually is responsible for loading the goods onto the vessel at the agreed port and the main ocean transportation is the responsibility of the buyer as is further transportation.
The use of the right Incoterm will make it easier to decide who handles which aspect of the international logistics process.
Businesses should ensure the sales contracts are consistent with the selected Incoterm and the freight arrangements.
What Goods Can Be Exported by Sea?
Almost anything that is legal for commercial use can be shipped by sea, if it meets the regulations and requirements of shipping.
Examples include:
- Clothing
- Electronics
- Furniture
- Machinery
- Building materials
- Automotive parts
- Agricultural products
- Food products
- Industrial equipment
- Raw materials
- Consumer goods
- Vehicles
Some products do, however, need extra controls.
For instance, certain packing, declaration, documentation or inspection requirements might apply to dangerous goods, chemicals, batteries, food products, pharmaceuticals, timber and other regulated commodities.
All exporters should always know the requirements that apply to them and their product that they are exporting.
Shipping Dangerous Goods by Sea
Special attention is needed for dangerous goods.
They include products like some chemicals, flammable products, batteries and other regulated products.
Dangerous Goods businesses may require particular declarations, packing and labelling as required by the maritime regulations.
Misdeclared dangerous goods may be hazardous to health and have serious consequences for regulations.
If you are exporting potentially hazardous goods, collaborate with the logistics company to learn about the requirements before booking the export.
How Can Businesses Reduce Sea Freight Costs?
Businesses can streamline sea freight in a number of ways.
Consolidate Shipments
If feasible, shipping multiple smaller lots may help minimize transportation expenses.
Improve Packaging
You can save on packaging space with efficient packaging.
Plan Ahead
You might have to settle for the last-minute option and may end up paying more.
Compare FCL and LCL
Don’t assume that one is cheaper, just because. Calculate the overall cost according to your quantity of shippings.
Optimise Container Space
Businesses can maximize the value of each shipment with effective container loading.
Understand Additional Charges
Do not assume what destination and origin charges are when you begin shipping – ask your freight forwarder to clarify.
Work With an Experienced Freight Forwarder
A reliable freight forwarder will help to coordinate shipping lines, customs, documentation, transport and other requirements for logistics.
Why Choose Think Global Logistics for Sea Freight Export?
International shipping may get complicated when a business must arrange various providers, documents, ports, customs and transportation services.
At this point, the Think Global Logistics (TGL) team can offer assistance.
TGL is an Australian owned international freight forwarder specializing in helping businesses with practical and efficient logistics solutions.
At TGL, freight is not just about transporting a box from a port to another port; it’s about the whole process of the supply chain.
Our approach is built around:
- One Point of Contact
- Innovation & Technology
- Fixed Quoting
- Transparent Pricing
- An Inclusive Team
Whether it’s trade via water, air, local or road transport, warehousing and customs clearance, the aim is to simplify international logistics for companies.
Having one logistics partner to oversee the various phases of shipment can simplify the process and contribute to visibility for the exporter.
From LCL shipments to regular FCL shipments, having the right logistics partner can make a huge difference.
Sea Freight Export From Australia
International trade is an important driver of Australia’s economy and is crucial for Australian businesses, especially in the context of the need for a reliable freight system.
Australian exporters can export to anywhere in:
- Asia
- North America
- Europe
- The Middle East
- New Zealand
- Africa
- The Pacific
The significance of major Australian ports in the trade of goods and services with foreign countries is crucial.
But getting a container booked does not necessarily mean it will be a success.
The management of a business should take into account the whole logistics chain, from the place where the goods are picked up, to the end point where the customer gets the goods.
That’s where an integrated freight forwarding solution could come in handy.
Sea Freight vs Air Freight: Which Is Better?
The answer depends on your shipment.
| Factor | Sea Freight | Air Freight |
| Cost | Generally lower for large shipments | Generally higher |
| Transit time | Longer | Much faster |
| Cargo volume | Excellent for large volumes | Better for smaller/high-value shipments |
| Heavy cargo | Very suitable | Can be expensive |
| Urgent goods | Less suitable | Highly suitable |
| Large machinery | Excellent option | Often impractical or expensive |
| Inventory planning | Requires more lead time | Shorter lead times |
As for low cost and bulk loads, sea freight may be the better choice.
However, if speed is of the highest importance, it may be better to use air freight.
Depending on the product, customer needs and business strategy, many successful businesses make use of both to achieve their objectives.
Common Mistakes to Avoid When Exporting by Sea
Providing Incorrect Cargo Information
Weighing, dimensions, and cargo descriptions may cause a problem if they are incorrect.
Leaving Shipping Until the Last Minute
Planning is necessary for international freight. It might put undue pressure if you wait until the last minute.
Ignoring Destination Charges
Ocean freight rate is just a single element of the overall logistics cost.
Poor Packaging
An international travel can entail a lot of movement and handling for cargo.
Incorrect Documentation
Documentation errors can lead to delays and additional costs.
Choosing the Wrong Incoterm
Every business should be aware of its boundaries.
Failing to Plan for Customs
The customs requirements should be taken into account before the shipment is shipped from the country of origin.
Final Thoughts
Sea freight export is one of the most crucial ways to transport products worldwide.
Ocean freight can be an economical and scalable option for businesses that ship large volumes, heavy machinery, commercial goods or non-urgent items.
But getting products into a container is not all that is required for sea freight to be successful.
Packaging, documentation, customs, Incoterms, type of containers, freight rates, port operations, delivery requirements and any other potential fees should be taken into account by businesses.
The right freight forwarder can help to ease these moving parts.
Think Global Logistics (TGL) is dedicated to enabling companies to transport freight more intelligently through a combination of logistics knowledge, technology, communication and solutions-based supply chain.
No matter if you are exporting your first shipment or having an established international supply chain, you can be ahead of the curve with the right process and right logistics partner.
Think Global Logistics — Our People, Our Technology, Your Advantage.
