FOB, CIF, or EXW? Understanding Incoterms Shipping Terms in Bulk Spice Procurement

FOB, CIF, or EXW? Understanding Incoterms in Bulk Spice Procurement

Whether you're importing oregano, chili flakes, or cumin in bulk, one of the first decisions you'll face is how the goods will be delivered — and who bears which responsibilities. That’s where Incoterms come in.

In this article, we’ll cover the three most commonly used shipping terms in the bulk spice trade: EXW, FOB, and CIF.

1. XW (Ex Works)

What it means: The seller makes the goods available at their premises (e.g., spice factory or warehouse). The buyer handles all logistics and documentation from that point onward.

Used when:

• The buyer has strong freight/logistics infrastructure

• Maximum control is desired on the buyer side

Risks:The buyer assumes full responsibility and cost from pickup onward — including customs clearance and international freight.

2. FOB (Free on Board)

What it means: The seller handles all local logistics and delivers the goods to the vessel at the loading port. Risk transfers to the buyer once the cargo is on board the ship.

Used when:

• The buyer wants control over the sea freight

• The seller is located near the port of loading

Benefits:Efficient for buyers who manage their own shipping lines or use freight forwarders.

3. CIF (Cost, Insurance, and Freight)

What it means: The seller is responsible for delivering the goods to the buyer’s destination port, including freight and minimum marine insurance.

Used when:

• The buyer prefers a simplified process

• The buyer lacks a freight partner or local team

Important note:Responsibility transfers once the goods pass the ship’s rail at origin — not upon delivery to the final port. Insurance is typically minimal unless otherwise agreed.

Tuna Spice: Flexible on All Shipping Terms

At Tuna Spice, we offer all three delivery models — tailored to your logistics capabilities and risk appetite. Whether you're a seasoned importer or just entering the spice trade, our export team ensures:

• Timely document preparation

• Clear Incoterm-based contracts

• Transparent cost breakdowns

• Global shipping support

Which Term Is Right for You?

Buyer Profile	Recommended Term
First-time importer	CIF
Experienced operator	FOB
Fully integrated firm	EXW

Choosing the correct Incoterm doesn't just impact logistics — it affects pricing, responsibility, and risk exposure throughout the supply chain.

Understanding Incoterms is key to managing cost and minimizing misunderstandings in international spice trade. Tuna Spice provides support across all terms — from field to port, and beyond.