Freight Quotes: Why Two Forwarders Give Different Prices

Two freight quotes for the same 40-foot container on the Shanghai-Santos route can differ by several hundred dollars, and neither one is wrong. The gap has nothing to do with the ocean rate itself. It comes from what each forwarder chose to include. One bundles freight, surcharges, and destination costs into a single line. The other lists base freight, BAF, THC, terminal handling, ISPS, and B/L fee separately, then pushes port storage and Brazil’s AFRMM levy to a second page. Same voyage, same container, different scopes.

Same container, two quotes, two totals

Base freight (ocean freight, or O/F) is the carrier’s price for space on the vessel. It is the most visible line on the quote and, oddly, the smallest share of total cost between origin port and the importer’s warehouse. Carrier surcharges pile on around it: BAF for fuel, PSS for peak season, GRI for general rate increases. Then come terminal charges at origin and destination (THC, ISPS for port security), documentation costs (B/L fee, bill of lading release), and local levies like Brazil’s AFRMM, calculated on the freight value in foreign currency and collected when the importer registers the CE Mercante, the country’s electronic cargo manifest.

Where the two quotes start to diverge is presentation. One forwarder sends an all-in rate: total dollars per container, surcharges folded in. Another itemizes every component in a table, listing the currency and unit for each charge. Both formats are normal. The problem shows up when the importer puts them side by side and compares the first number in sight. One total may include destination THC and terminal handling. The other covers only the cost to port; local charges will show up later in a follow-up document or directly on the invoice after shipment.

Three variables that change the total without changing the freight

Two forwarders can itemize the same lines and still land on different totals. Three choices made while building the proposal explain most of the gap.

Exchange rate. Freight is quoted in US dollars, but many forwarders convert to the importer’s local currency in the proposal. One uses the day’s official rate. Another applies a commercial rate with a spread. A third keeps the value in dollars and converts only at invoicing. On a freight charge of USD 4,500, the gap between the official rate and a rate with a 2% to 3% spread works out to USD 90 to USD 135 more per container, depending on the day. An importer who sees only the local-currency total cannot tell which exchange rate is built into the number.

Scope. A port-to-port quote covers from the origin terminal to the destination terminal. A door-to-door quote also includes inland trucking to the importer’s warehouse, and sometimes cargo insurance. When one proposal is port-to-port and the other is door-to-door, the price difference is just the extra service, included in one and contracted separately in the other.

Destination local charges. Terminal handling, initial storage days, deconsolidation for LCL shipments, terminal release fees, and weighing charges show up in every import, but not every quote lists them. When the forwarder leaves these lines out, they appear later on the service invoice or directly from the terminal, with timelines and currencies the importer did not plan for.

How to put two quotes on the same basis

Before comparing the bottom line, the importer needs to get both proposals into the same format. Four questions clear up most of the differences.

Is the total all-in or freight-and-surcharges only? If it is all-in, ask the forwarder to split it into separate lines with the currency for each component. A well-structured quote shows every charge itemized, the currency alongside it, and the calculation basis (per container, per weight, per bill of lading). Without that breakdown, comparison is guesswork.

Which exchange rate was used to convert dollars? If the quote arrived in local currency, ask for the rate and reference date. If the two proposals use different rates, convert both to dollars and compare in one currency. Apply the actual rate only on the payment date.

Is the scope the same? Port-to-port and door-to-door are two different deliveries. If one proposal includes trucking and the other does not, add the transport cost to the shorter proposal before comparing.

Are destination local charges included? Terminal handling at Santos, for instance, is billed by the terminal operator and varies by facility. If one quote includes it and the other does not, that difference is a cost the importer will pay either way, just at a different moment.

Doing this normalization takes a few minutes. Skipping it leads to the most common mistake: picking the cheapest quote, shipping, and finding on the invoice that the charges left off the proposal were exactly the ones that tipped the total.

How Tier2 Cargo itemizes every charge in the quote

Tier2 Cargo builds the quote with each charge on its own line, showing the currency, the billing unit (per container, per weight, per bill of lading), and the calculation rule. A forwarder using the system sends a proposal where every surcharge, terminal cost, and levy appears in its original currency, nothing bundled by default. When the exchange rate moves between quoting and invoicing, the system captures the new rate and recalculates the local-currency value. The difference between what was quoted and what was invoiced stays recorded in the shipment’s margin.

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Next time a freight quote lands in your inbox, ask for the line-by-line breakdown and compare in the same currency, the same scope, and with the same local charges. The quote worth trusting is the one that shows every line, because it tells the importer exactly what is being purchased.