GLOSSARY OF FREIGHT TERMS

New to shipping? See our full list of freight terms and explanations in our freight glossary.

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Freight TermExplanation
Air WaybillA contract between the shipper and the carrier, which also functions as a receipt of goods of carriage, a dispatch note, an invoice of the transportation charges, an insurance certificate - if such is effected through the airline - a document used by customs authorities as evidence of shipment and transit, and a delivery receipt.
All RisksThe widest form of transportation insurance coverage available. However, contrary to the term itself, it does not cover every risk. The loss or damage must be accidental in nature.
AMSAutomated Manifest System of US customs introduced in 2004. This system requires airlines and shipping lines to submit within prescribed time limits, precise details of cargo arriving at USA ports and airports.
ATFAirline Terminal Fee. A charge for the physical processing of cargo at the bond store.
AverageIn sea freight insurance, it means damage.
BAFBunker Adjustment Factor. A change to a carrier’s rates to accommodate the price of oil.
BerthThe specific location in a port at which a ship is moored.
Bill of LadingA document that usually evidences the contract of carriage between shipper and charter. It serves not only as the primary transport document and as a required document for customs clearance, but also as a ‘title’ or ‘deed’ to the cargo. Only relevant to sea freight.
Bonded GoodsProducts on which customs have not yet been paid. Kept in a specific warehouse.
Breaking BulkTo unload or unpack a container or ship.
CAFCurrency Adjustment Factor. An adjustment to a carrier’s rates to account for fluctuating value of currency.
CarnetAn international customs document used for the temporary duty/tax free entry of goods under international conventions. It is effectively a passport for eligible goods in the countries that subscribe to the relevant conventions.
CarriersCompanies that physically transport the freight - airliners, cargo liners, trucks, etc. In most cases they are not also freight forwarders, but some NVOCCs are kind of a combination.
Carrier’s LienA carrier's right to hold on to cargo until they have received payment for transporting the goods.
CASSCargo Agents Settlement System. Responsible for settling the accounting between cargo agents and IATA, or Non-IATA, airlines that use the CASS services.
Cellular VesselA ship designed to stack containers.
Certificate of OriginTrade document confirming that exported goods have been manufactured/ produced in a particular country. Each is marked a unique number, and states the full legal name and tax info of the exporter, the address of the consignee, relevant markings or numbers on the packages, the number and kind of packages, and a description of each good.
ConferenceA group of carriers that pool their regular service under common rules and tariffs.
Contract of carriageThe international carriage of goods is conducted under conventions established for the purposes of ensuring uniformity in the application of rules and laws, the setting of minimum standards for the liabilities and responsibilities of carriers who contract to transport cargo, and the rights and responsibilities of merchants, (shippers) their agents and contractors.
Deadweight TonnageThe total capacity of a ship - crew and all.
DrawbackCustoms paid on exports previously imported.
FCLFull Container Load.
Freight ForwardersCompanies that arrange the logistics of shipping. Unlike the shippers and carriers, the forwarders are asset-light. Shippers have goods, and carriers have transportation. Forwarders have contracts with shippers and arrange for your stuff to be shipped from one place to another, start to finish. They are service companies.
FTLFull Truck Load.
IncotermsCommercial standards for purchasing and shipping. Incoterms show which charges the seller and buyer are responsible for. They eliminate any confusion should have about when you should pay for what. Want to know who has to pay for customs levied on air freight? Check the Incoterms.
House Bill of LadingThe forwarder’s bill of lading.
ICCInternational Chambers of Commerce.
ICSInternational Chamber of Shipping.
IglooA container shaped to fit in an aircraft’s cargo hold.
JettisonThrowing cargo overboard to save the ship.
IMOInternational Maritime Organization. UN body responsible for anti-pollution conventions and shipping.
Inbound logisticsThe process of transporting materials or goods to a manufacturer, supplier, warehouse, or retail store. On the supply side.
Inherent ViceQuality of goods or packaging that risks damage, without any outside forces. E.g. - steel can rust.
IntermodalShipping freight by more than one mode of transportation. The reason that the shipping container is called an intermodal shipping container.
LCLLess than container load.
Lift on/Lift offCharge from a carrier for moving an FCL from the truck to somewhere else.
LinerA freight ship with a regular schedule and regular ports of loading and unloading.
LTLLess than truck load. This is LCL in trucking. LTL is suitable for small shipments. There is often a 100 pound weight limit. Because LTL shipments contain multiple items going to multiple destinations, they take longer.
ManifestList of cargo carried on the ship.
Minimum ChargeThe lowest a carrier will charge for transport between two ports.
ModesThe different types of transportation for freight. The main ones are air, sea, truck, and rail.
Net WeightThe weight of a shipment excluding the weight of packaging.
Outbound LogisticsThe process of transporting goods to the customer or final user.
Out of GageCargo that doesn’t fit in even open top containers, flat racks, or on platforms.
Outsider LineA shipping line that isn’t part of a conference.
Peak Season SurchargeAn additional charge from carriers during popular shipping seasons.
Proof of DeliverySigned receipt of delivery.
Proximate CauseImmediate cause of damage.
Reefer ContainerA refrigerated container.
Revenue TonThe unit of weight that the freight payment is calculated against. Usually one cubic meter or 1000 kg.
SCACStandard Carrier Alpha Code. A two to four letter code to identify the carrier.
Scale WeightThe actual weight of a shipment, including packaging.
SealA coded/numbered metal rod used to seal shipping containers. Their levels of security vary with the type of seal.
Security SurchargeA charge from air and sea carriers. For air it’s usually based on kilos of cargo. Ocean carriers charge on container, revenue ton, or bill of lading.
Shipped On Board Bill of LadingReceipt after the cargo has been loaded on to the ship.
ShipperA person who wants to send freight to a buyer.
Short LandedWhen part or all of a shipment that has been shipped hasn’t arrived.
Shut OutFreight shipped on the wrong vessel.
Single Administrative DocumentA document for some areas of the world (includes EU, China) for all customs charges.
SubrogationLegal right of insurance companies to make counter claims on carriers for loss or damage.
Tailgate InspectionInspection of a container loaded on a truck, from the back with doors open.
Tank ContainerA container made for the bulk shipment of liquids, gases, and powders.
Through Bill of LadingA bill of lading for multiple modes of transportation. The carrier that issues it is responsible for forwarding.
Unit Load DeviceThe special containers and pallets used for air cargo.
Valuable CargoFreight with a value of $1,000+ per gross kg. Or contains precious metals, banknotes, pearls, or precious stones.
Warehouse to warehouseConfirms where freight insurance ends. There may be a period of time after the goods arrive at their destination for which the insurance continues.
WharfageCharge for transporting a container around the port. Charged by metric tonne or cubic meter.
Zone ChargesOcean liner charges for carting of LCL or FCL cargo.

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