Incoterms for raw‑material imports, explained simply

PERAMERA · 3 November 2026

An Incoterm is the short code in a quotation that says who pays for transport, who arranges insurance and where the risk passes from seller to buyer. The current rules are Incoterms 2020, published by the International Chamber of Commerce. These are the ones you will see most when importing raw materials.

EXW (Ex Works)

The seller makes the goods available at its premises. The buyer arranges and pays for everything else, including export clearance. Lowest price on paper, most work for the buyer.

FCA (Free Carrier)

The seller hands the goods, cleared for export, to the carrier the buyer nominates. Often a better choice than EXW because export formalities stay with the seller.

FOB (Free On Board)

Sea freight only. The seller clears the goods for export and loads them on the vessel the buyer has booked. Risk passes once the goods are on board.

CFR and CIF (Cost and Freight; Cost, Insurance and Freight)

Sea freight only. The seller pays the freight to the destination port; with CIF the seller also buys minimum insurance. Note that risk still passes to the buyer when the goods are loaded at origin.

DAP (Delivered At Place)

The seller delivers to a named place, such as your warehouse, ready for unloading. The buyer handles import clearance and duties. Simple for buyers who want one price to the door.

Which to choose

If you have a trusted freight forwarder, FCA or FOB gives you control of cost. If you want simplicity, ask for CIF to the port or DAP to your site. Whatever you choose, agree it in writing before the order.

PERAMERA can quote on the term that suits you and coordinate freight and paperwork. Ask for a quotation.