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Freight transport refers to moving goods from the point of origin to their final destination. It is a complex logistical operation that relies on strategic planning and execution to ensure cargo arrives safely and on time. Freight transport must also be highly efficient to make it affordable for businesses.

Many businesses use professional freight forwarders to manage importing, exporting, and product distribution. These freight services specialize in transportation and help reduce freight shipping costs for companies.

Forwarders oversee distribution for multiple clients at a time, ensuring they can take advantage of significant quantity discounts. They also rely on their international network to facilitate fast and efficient transportation.

Choosing suitable transportation is one of the most critical steps, regardless of the type of products you ship. Freight rates are one of the most influential factors in your decision. Understanding your transport options and pricing is a crucial phase of the process.

Different Types of Freight

There are several different modes of transport in freight shipping. Each option has a different method for determining shipping rates. The most popular freight transport modes are ocean, air, road, and rail.

For international distribution, intermodal transport is common. This involves combining multiple transport options. For example, if a shipping container travels from China to the west coast of the U.S. via ocean liner, the inventory may need to be transported to the east coast. Since the merchandise no longer needs to cross international waters, a trucking company may be the most cost-effective way to handle this leg of the trip.

Ocean Freight

Ocean freight is the most popular shipping method for international transport. Large ocean carriers can transport enormous volumes and quantities of inventory around the globe. Today, the largest vessels can hold up to 24,000 TEUs (20 equipment units; you would require a 40-mile-long freight train to transport an equivalent cross-country load.

Ocean liners transport around 90% of international goods due to their high efficiency and low price. Ocean shipments are far cheaper than air transport, particularly when carrying high volumes or bulky inventory, like raw materials or machinery.

There are fewer restrictions when transporting certain goods by sea freight. Hazardous materials, including flammables and chemical products, can be shipped via ocean vessel without issue as long as they’re packaged and labeled correctly. The main drawback with ocean freight is speed. It can take 30 to 40 days for a shipment to travel from China to the U.S.

The global pandemic has caused even more issues for ocean transportation companies. Port congestion was rampant worldwide, causing significant delays. Supply chain disruptions also meant a shortage of shipping containers, creating massive spikes in freight prices.

Although the current freight market has stabilized, this is an excellent example of how the cost of freight can change. It’s essential to work with a reliable freight forwarding company for fast and efficient international transport.

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Air Freight

Air freight is the fastest mode of international transport. While ocean vessels take around a month to travel from China to the U.S., air freight carriers take a matter of hours. Air freight is a fast and reliable solution if you need to move goods in a hurry.

However, air freight is the most expensive method for shipping goods. Rates are determined by actual or volumetric weight. You can expect extremely high freight quotes if you’re shipping heavy items or high-volume goods. Air freight is intended for high-value and time-sensitive shipments, such as apparel, electronics, pharmaceuticals, and documents.

Aside from pricing, there are some notable complications with air transport. If your business is environmentally conscious, air cargo produces significant CO2 freight emissions. Freight class restrictions also make distributing certain items on carrier planes challenging.

For example, the International Air Transport Association (IATA) considers lithium batteries dangerous goods. Strict criteria must be met to send lithium batteries or goods containing lithium batteries via air transport. In many cases, ocean freight is a cheaper and less stressful option for these materials.

Road Freight

Road freight is a shipping service that moves goods over land. It is a standard mode of transport in North and Central America. Trucks and vans transport goods domestically at affordable rates, covering short and long-distance routes. Unlike air and ocean transport, road freight can deliver inventory directly to the destination.

Trucks are permitted to carry virtually every type of freight classification, including hazardous materials. They can handle significant cargo volumes and are an excellent option for midsize importers.

Rail Freight

Rail freight uses extensive railroads and trains to transport goods internationally and domestically. The U.S., Northern Europe, and Asia have excellent rail networks, so it is a popular and widely used transport method worldwide. It is a popular option for bulk cargo handling operations, like raw materials such as coal, oil, and ore.

Rail modes of transport offer capacity and value for money. Trains are versatile, adaptable, and can carry a wide range of container types. Some train carriages are specially designed for particular kinds of products, helping improve efficiency.

Determining Ocean Freight Rates

Ocean freight is transported in 20 or 40-foot shipping containers. Freight costs depend on whether you choose a full container load (FCL) or a less than container load (LCL). With an FCL shipment, you pay a flat rate for a container. The unit is used exclusively to carry your merchandise.

LCL shipments are available to importers and exporters who don’t have enough goods to justify paying for an entire container. Freight carriers consolidate container shipments with a combination of small loads from multiple clients. This ensures you only pay for the amount of space your cargo occupies.

LCL ocean freight rates are usually calculated by volume. However, most shipping lines have stipulations for heavy goods. If your FCL or LCL shipment reaches a certain weight, you may have to pay a higher shipping price or an extra fee.

Additional Ocean Freight Fees

Several surcharges and additional fees are added to all freight shipping costs. In addition to the base ocean freight rate, you may have to pay the following:

  • Customs surcharges
  • Terminal handling fees (charged by port authorities)
  • Customs broker fees
  • Pickup and delivery fees
  • Insurance
  • Fuel surcharges
  • Routing charges

Determining Air Freight Rates

Air cargo pricing is charged by volumetric weight or actual weight. Volumetric weight is measured in cubic meters and considers the amount of space your inventory occupies.
You are charged by volume if the volumetric weight is higher than the actual weight. You are charged by weight if the actual weight exceeds the volumetric weight.

Additional Air Freight Fees

In addition to the base contract rate, you may also have to pay:

  • Fuel surcharges
  • Security fees
  • Terminal handling charges
  • Airport transfer fees
  • Customs broker fees
  • Accessorial fees

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Determining Road Freight Rates

Trucking rates are notoriously unstable and experience year-round fluctuations. Current fuel costs are one of the main drivers of road rate spikes, so monitoring the average diesel fuel price when preparing shipments is essential. Base trucking rates are calculated using:

  • Overall inventory weight
  • Shipment density
  • Freight classification
  • Distance between pickup and delivery points

Individual shipping companies may also face extra tariffs. When dealing with truck carriers for freight shipping, request the entire cost on your freight quotation to avoid surprises on your final invoice.

Determining Rail Freight Rates

Rail freight rates are also vulnerable to fluctuations due to supply and demand. They are determined using:

  • Size or volume of shipments
  • Distance between pickup and delivery points
  • Fuel costs
  • Operational costs such as the type of carrier, number of wagons, and the type of tracks used

When shipping goods internationally, it’s also important to consider government regulations. The maximum operational time permitted for workers may differ between North Europe and Central America. Delays to shipments may require you to pay for temporary storage while your goods are in transit.

Secure Competitive Freight Rates with Asiana USA

Transporting goods domestically and internationally brings many logistical challenges that cost businesses valuable time and money. Freight rates, surcharges, and differing government regulations can make customs clearance a major issue.

To avoid potential transportation pitfalls, it’s often best to work with a reputable freight forwarding business, like Asiana USA. We provide world-class services to importers and exporters, helping them streamline distribution and avail of competitive pricing. For more information on freight rates or to request a quote, call us at (855) 500-1808.

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