What Are Incoterms?
Incoterms (International Commercial Terms) are a set of standardised trade terms published by the International Chamber of Commerce. They define who is responsible for each stage of a shipment: packing, loading, transport, insurance, customs clearance, and delivery.
ScrapTrade supports three incoterms that cover the vast majority of scrap trades. Choosing the right one at listing time is important because it determines the final price a buyer will pay — and your obligations as a seller.
EXW — Ex Works
In plain language
The buyer collects the scrap from your location. Your job ends at your gate. The buyer handles everything from that point — loading, domestic transport, export customs, ocean freight, import customs, and final delivery.
| Task | Seller | Buyer |
|---|---|---|
| Packaging & labelling | — | |
| Loading onto vehicle | — | |
| Domestic transport to port | — | |
| Export customs clearance | — | |
| Ocean freight | — | |
| Marine insurance | — | |
| Import customs clearance | — |
Best for sellers who: do not have an export licence, are new to international trade, or want the simplest possible transaction. EXW listings typically have the lowest listed price because the buyer bears all shipping costs.
FOB — Free on Board
In plain language
You deliver the scrap to the port and load it onto the vessel. Once it is on board the ship, the buyer's responsibility begins. You handle domestic transport and export customs; the buyer handles ocean freight, insurance, import customs, and onward delivery.
| Task | Seller | Buyer |
|---|---|---|
| Packaging & labelling | — | |
| Domestic transport to port | — | |
| Export customs clearance | — | |
| Loading onto vessel | — | |
| Ocean freight | — | |
| Marine insurance | — | |
| Import customs clearance | — |
Best for sellers who: have export capability, are near a major sea port, and want to offer a cleaner price that includes port delivery — attracting buyers who prefer not to manage origin-side logistics.
CIF — Cost, Insurance & Freight
In plain language
You arrange and pay for everything up to the buyer's port — including ocean freight and marine insurance. The buyer only handles import customs, inland transport from their port, and final delivery. CIF price is the most all-inclusive listing price.
| Task | Seller | Buyer |
|---|---|---|
| Packaging & labelling | — | |
| Domestic transport to port | — | |
| Export customs clearance | — | |
| Ocean freight | — | |
| Marine insurance | — | |
| Import customs clearance | — | |
| Inland delivery from buyer's port | — |
Best for sellers who: have freight contacts and can negotiate competitive shipping rates, want to reach the widest buyer pool (many buyers, especially in Asia, prefer CIF because it simplifies their procurement cost calculation), and can command a premium price that includes logistics.
Choosing the Right Incoterm
Use this decision table to pick the right incoterm for your situation:
| Your situation | Recommended |
|---|---|
| No export licence, want simplest transaction | EXW |
| Near a major port, have export licence | FOB |
| Have freight contacts, want highest price | CIF |
| First time exporting | EXW |
| Selling large volumes to Asian buyers | CIF or FOB |
| Unsure — just want to list quickly | EXW |
As a Buyer, What to Look For
EXW listings
Lowest listed price, but you pay all shipping. Always add estimated freight to the listing price before comparing. You need to arrange collection from the seller's location — factor in access, loading equipment, and inland haulage.
FOB listings
Seller delivers to port and loads. You pay ocean freight, insurance, and import customs. Good balance: you control the freight cost but seller handles origin-side logistics.
CIF listings
All-inclusive to your port. Higher listed price but your total landed cost is easy to calculate — just add your import duties and inland delivery. Best for buyers who want simplicity.
FAQs
Can I negotiate incoterms with a seller?
Yes, via in-app messaging after placing a bid or submitting an offer. However, the final incoterm on the confirmed order will be what was listed. Any agreed changes should be discussed with support to update the order record.
Who pays import customs and duties?
Under all three ScrapTrade incoterms (EXW, FOB, CIF), the buyer is responsible for import customs clearance and any import duties or taxes at the destination country. This cost is never included in the listed price.
What if the seller claims CIF but cannot arrange shipping?
This is a seller obligation. If a seller cannot fulfil their stated incoterm, you may raise a dispute. Our team will investigate and can issue a refund or facilitate renegotiation.
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