Updated: Jul 5, 2021
Hi everyone, Okta from Business team is here 🙋♀️
In the beginning, my expectations to work in su-re.co were to meet farmers and emerge new potential products for the domestic market. I never imagine I will start to learn about the export process. I still remember my facial expression when I heard FCL and LCL for the first time. It confounded yet exciting for me. Again, I’m so grateful that Pak Kusuma taught me patiently about the export process step by step.
So, what’s FCL and LCL shipment?
Both are container options for the ocean shipment method. FCL stands for Full Container Load, which means you exclusively use one whole container only for your cargo. You can choose any type of container that’s suitable for your cargo, such as Dry/Reefer/Open Top/Flat Rack/ISO Tank and 20', 40' and 40'HC.
LCL stands for Less than Container Load, which means you use some space in the container and will share one container together with different shipments from different customers. The shipping agent or freight forwarder will look for people to share one container with you or a container that’s available to load your cargo. The container is actually 20’ feet container type that can be loaded with 31 CBM cargo in volume weight.
Shipment cost of FCL vs LCL
In case of shipping 1 CBM of coffee green beans, of course, we will choose the LCL shipment. Then, how do we decide which one that we have to choose if we want to export a bigger quantity? Which one is the most cost-effective, FCL or LCL?
FCL has a fixed cost for one container but LCL will charge for the chargeable weight of cargo, either actual weight or volume weight (whichever is greater). Read about chargeable weight here.
There are several points you have to consider while calculating the ocean shipment cost, those are :
THC : Terminal Handling Charge, a fee for using the port
CFS : Container Freight Station, a fee to load cargo into a container. This fee only occurs on LCL shipments
All of those costs depend on the size of cargo and the freight forwarder’s quotation. When using LCL, it is important to pay attention to THC and CFS fees on the import side because if we compare, FCL may be cheaper than LCL in a certain quantity. LCL requires the freight forwarder additional steps like consolidating different shipments and processing multiple documents per container, etc.
I hope this can give you a brief explanation about FCL and LCL shipment. In my next blog, I will give you an example of FCL and LCL cost calculation. Stay tuned!
Meanwhile, you can learn more about export and import here. See you next week 😊👋🏽