FOB price is how to generate?

A, FOB exports increased on the impact of China's related industries

In China's traditional international trade, the export terms of trade is usually used CIF, C&F; imports use FOB. 1970s-80s, the former Ministry of Foreign Trade in each session of the Canton Fair before the usually have to send out a notice emphasizing the use of the terms of trade and the use of the above strong currency settlement. Before the 1990s, the above trade terms accounted for more than 80%. At that time, the two main companies engaged in China's foreign trade transportation were COSCO and Sinotrans. COSCO was the main carrier, Sinotrans was mainly engaged in freight forwarding and chartering, and China's shipping enterprises accounted for 70%-80% of the market share. However, after the 1990s, trade price terms gradually changed, FOB export terms increased rapidly, and now, accounts for more than 80% of export trade terms.

Second, the increase in export FOB contract terms are mainly due to two aspects

First, in our grasp of the transportation initiative, capacity constraints, freight rates rise frequently, surcharges come and go, I export companies can not accurately grasp the contract price. In order to facilitate foreign trade costing, export enterprises will gradually export CIF, C&F terms into FOB terms; import FOB terms into CIF terms.

Secondly, foreign liner companies, freight forwarding enterprises and buyers have a good history of cooperation between the origins of the 90's, with the deepening of the reform of China's shipping market and the gradual opening of the shipping market, foreign liner companies quickly into China's shipping market. 1993, foreign liner companies have set up wholly-owned companies in our country, foreign forwarding enterprises have followed suit, set up a joint venture freight forwarding company or set up a representative in our country. Foreign liner companies have set up wholly-owned companies in China since 1993, and foreign freight forwarding enterprises have also followed suit by setting up joint venture forwarding companies or representative offices in China to carry out freight forwarding business. As foreign liner companies, freight forwarding enterprises, good service, preferential prices, door-to-door service, buyers are willing to designate foreign liner companies and freight forwarding arrangements for transportation, and therefore also require the signing of FOB contract terms.

The increase of export FOB goods, China's liner, freight forwarders, cargo owners, maritime foreign exchange earnings and expenditures, insurance and taxes have caused immeasurable impact.

1. The impact on the ship of the country: export FOB, import CIF terms of the increase in the buyer to designate the foreign liner company transportation phenomenon further increased, the share of the national ship transport is less and less.

2. The impact on the freight forwarder: in order to further squeeze China's freight forwarding enterprises, market share, foreign liner companies and freight forwarding enterprises from 1994 have reduced booking commissions have been reduced to 2.5%, 1%, and finally canceled completely. This makes China's freight forwarding enterprises increasingly narrow space for survival. At present, China's international freight forwarding industry is a marginal industry.

3. The increase in export FOB goods also caused by maritime freight revenue and expenditure imbalance. At present, more than 80% of China's export trade terms are FOB terms, more than 80% of the import trade CIF terms, so that the transportation is basically two out. Foreign parties generally designate foreign liner companies and freight forwarders to arrange transportation. This means that 80% of the benefits are taken by foreign liner companies, and there is a serious imbalance in the balance of payments of maritime transportation.

4. Impact on China's insurance and taxation: As the FOB designated goods will be further increased, the settlement of insurance and freight are carried out in foreign countries, so China's insurance industry and taxation will be seriously affected.

5. Impact on foreign trade cargo owners: After occupying the shipping market share in China, foreign liner companies, in order to further consolidate and expand their market share, have been concessions to foreign FOB buyers and CIF sellers, and began to use their monopoly advantageous position to squeeze the profit margins of China's cargo owners, and in addition to the freight charges to the Chinese owners of all kinds of unreasonable surcharges, such as Terminal Handling Charge (THC), Signing fee, exchange fee, sealing fee, equipment operation and management fee, peak season surcharge, currency adjustment surcharge, etc., which seriously undermines international trade practices and shipping order.

From 2002 to the present, only the THC (terminal handling charge) is a fee, the additional expenditure of Chinese shippers in the past three years amounted to about 53 billion yuan in total.

As we all know, in the traditional terms of international trade and liner shipping, except for unforeseen factors, such as fuel rise, port congestion, war and other reasons for which surcharges can be levied, the rest of the predictable and relatively fixed costs are included in the freight rate. Terminal Handling Charge (THC), Signing Charge, Exchange Charge, Seal Charge, etc. are the components of freight rate. Accordingly, in international container liner transportation, the liner company has the responsibility and obligation to bear the above obligations and costs. These are the traditional international trade transportation rules. However, in recent years, the international liner conferences and line organizations have been greatly undermining these rules. In terms of indiscriminate charges, the world's shipping giant Maersk has been the most prominent. And these liner companies charges are characterized by: no consultation, no negotiation, arbitrariness, want to collect money on a notice, want to collect how much on how much, do not pay to get the bill of lading or can not pick up the goods.

Three, combined efforts to reverse the situation of increased FOB goods

Can we reverse the situation of increased FOB goods, the relationship between China's shipping companies, freight forwarders, logistics enterprises, the survival of the situation. To reverse the situation, the need for China's shipping companies, freight forwarders, cargo owners must *** with the efforts of the three parties should cooperate with each other to establish a close cooperative relationship. In the face of fierce competition in international trade, foreign traders in order to reduce trade costs and transportation costs, the requirements of the transport enterprises to do "rapid, punctual, saving, safe and efficient", usually require the transportation of goods to do door-to-door service. China's shipping companies, freight forwarders, logistics companies can not fully meet the needs of foreign customers, so the first step is to improve the level of service, stabilize the price of transportation, and set up service outlets in foreign countries. If you do not have the ability to set up a network, with foreign freight forwarding enterprises, logistics companies to establish a mutual agency of the cooperative relationship for the owner to provide door-to-door one-stop service. As long as China's shipping enterprises, freight forwarding enterprises, logistics enterprises on the transportation link of the cost can remain stable, competitive, services to meet the needs of foreign customers, China's shippers and foreigners in the negotiation of trade contracts, there are reasons to request the signing of the CIF contract terms.

To fundamentally solve the problem of international shipping monopoly giants charging fees indiscriminately and the problem of chaotic order in the shipping market, not only need to industry associations to fight, but also need to promote the government to improve the laws and regulations relating to international shipping and regulate the operation of shipping companies and freight enterprises and charging behavior.

First of all, the relevant laws and regulations should emphasize the fair negotiation mechanism between the shipping and cargo parties, and give equal status to the consignee and consignor. At the same time, it is suggested that our government and legislature should formulate their own really feasible and fair shipping laws and regulations according to the actual situation of China's shipping market, withdraw from the Convention on the Code of Conduct for the United Nations Liner Conferences or increase the conditions of reservation, or refer to the legislation of the United States, Canada and the European Union, and formulate a more targeted law restricting the enjoyment of antitrust exemption by the liner shipping organizations, so as to further improve China's maritime transport legal system, to ensure the healthy development of China's shipping and trade, and to protect the legitimate rights and interests of China's cargo owners.

Secondly, the THC issue has triggered shipping companies to recklessly announce a series of other arbitrary charges other than freight rates in the shipping market. Therefore, the government should further regulate the charging behavior in the shipping market, strictly implement the tariff reporting system, and stipulate that carriers can only charge shippers a one-price freight rate, and are not allowed to charge other fees in addition to the freight rate.

Thirdly, the disorderly competition in the shipping market should be further rectified, and the shipping industry association should play a coordinating role to prohibit unfair tariff wars, prevent tariffs from fluctuating and rising indiscriminately, and resolutely investigate and deal with irregularities, so as to keep tariffs in the shipping market at a stable and reasonable level, and to prevent shipping enterprises from soliciting cargoes by means of unfair competition and transferring the losses or other The fourth is to prevent shipping companies from soliciting cargoes through unfair competition and transferring the losses or other unreasonable costs caused by disorderly competition to innocent Chinese cargo owners.

Fourth, we should further regulate the business behavior of ocean shipping intermediaries and establish an effective risk prevention mechanism to effectively protect the legitimate rights and interests of Chinese cargo owners.

Author: Cai Jiaxiang, Vice President of China Association of Enterprises in Foreign Trade and Economic Cooperation (CAEFTC)

Ministry of Commerce, China Economic and Trade, Issue No. 6, 2005