FOB vs CIF: How to Quote African Buyers from China

In FOB vs CIF, the difference is who pays for the sea freight and insurance. With FOB (Free On Board), you deliver the goods onto the ship at the Chinese port, and the buyer pays for the ocean trip. With CIF (Cost, Insurance and Freight), you pay for freight and insurance to the destination port, and the price you quote includes them. Many African importers have their own forwarders, so FOB is often welcome, but ask each buyer.

This is general information. Check the current Incoterms rules and ask your forwarder or bank if you are not sure.

Incoterms for African buyers: the basics

Incoterms are standard trade terms published by the International Chamber of Commerce. They say who does what, who pays what and where the risk passes from seller to buyer. Incoterms for African buyers are the same as for any buyer. What changes is the practical side: which forwarder, which port, and what the buyer can pay for in dollars.

The three you will use most for sea cargo are FOB, CFR and CIF. Always name the port after the term, for example "FOB Ningbo". A term without a port is not a clear quote.

FOB Shanghai Ningbo Shenzhen: what you do

With FOB Shanghai Ningbo Shenzhen (or any Chinese port), your job is to:

Pack the goods well for ocean transport.
Clear the goods for export in China.
Deliver the goods to the named port and load them on the ship the buyer arranged.

The buyer books the freight, pays for the ocean trip and insurance, and handles import clearance in Africa. Your price covers your goods, your local costs in China and export clearance. Risk passes to the buyer once the goods are on board.

FOB works well when the buyer has a trusted forwarder and wants control. Your risk is lower, because you are not exposed to freight changes. One caution: ask the buyer to name the forwarder early, and check that the forwarder is real. See how to verify an African buyer.

CIF Lagos price: what you add

A CIF Lagos price (or CIF Mombasa, CIF Tema and so on) includes your goods, export costs, ocean freight to the named port and insurance. You book the freight and arrange the insurance. The buyer pays import duties, taxes and costs after the ship arrives. Risk of loss still passes to the buyer once goods are on board, even though you paid for freight, so insurance matters.

CIF is helpful for buyers who do not know the shipping side. It lets them compare your price directly with other suppliers' CIF prices. But it exposes you to freight changes. If freight rises between your quote and the booking, you lose money unless the quote has a short validity.

How to quote shipping to Africa

Here is a simple way for how to quote shipping to Africa without guessing:

Start with your FOB price. This is your cost plus profit.
Ask your forwarder for a written freight quote to the named port, for your exact cargo size and weight, and the date it is valid until.
Ask for an insurance quote, or the rate your forwarder uses.
Add them to get CIF. Or, if you do not buy insurance, quote CFR (Cost and Freight).
Write the validity date on the quote. Freight rates move, so a long validity is a risk.

Illustrative example with round numbers: your FOB price is US$10,000. Your forwarder quotes freight and insurance of US$1,000 together. Your CIF price is then US$11,000. These numbers are only for illustration. Real freight depends on the port, the cargo, the season and the date.

Never copy a freight number from the internet or from last year's quote. Always get a fresh written quote. Our guide to shipping from China to Africa explains the main ports and the difference between LCL and FCL.

Landed cost for buyers

Your buyer thinks in landed cost: the total they pay to get goods to their warehouse. That includes your price, freight, insurance, import duty, VAT or similar taxes, port charges, clearing fees and inland transport. Your quote covers only part of this. Be honest about what is included and what is not, so there are no surprises. Learn more in what your buyer pays in duty and VAT. Do not quote duty rates yourself unless you have checked them. Duty depends on the product code and the country.

Which term should you offer?

Buyer has a forwarder: offer FOB.
Buyer is new to imports: offer CIF or CFR with a short validity, and a clear line saying duties and port charges are not included.
Large or risky order: choose terms together with payment terms. See payment terms with African buyers.

Some quotes can also show FOB, CFR and CIF together. This helps buyers compare, and it shows that you understand shipping.

Frequently asked questions

Do African buyers prefer FOB or CIF? It varies. Many have their own forwarders and choose FOB, but others want CIF. Ask.

What is CFR? CFR is like CIF but without insurance. The buyer arranges their own insurance.

Who pays if goods are lost at sea under CIF? Risk passes to the buyer at loading, but the insurance you bought covers the cargo. Make sure the policy names the buyer as beneficiary and ask your forwarder about it.

How long is a CIF quote valid? Keep it short and match the date on your freight quote.

Getting started

Create a quote template with FOB, CFR and CIF lines, a validity date and a list of what is not included. See also the export documents checklist. Ready to reach buyers? Apply as a supplier on Comilmart — there are no listing fees to get started.