📘 Incoterms Explained for Agro Trade Sales Teams

Understanding Incoterms is essential for professionals involved in international agro trade. This guide breaks down what they are, why they matter, and how sales teams should use them to avoid confusion and build client trust.

🧭 What Are Incoterms?

Incoterms (short for International Commercial Terms) are standardized rules developed by the International Chamber of Commerce (ICC).

They define:

• Who pays for shipping and insurance
• Who is responsible for customs clearance
• When the ownership and risk shift from seller to buyer

These terms ensure smooth communication and reduce legal risks in global trade.

📦 Why Sales Teams Must Understand Incoterms

Knowing Incoterms helps you:

✅ Quote prices accurately
✅ Set clear delivery expectations
✅ Build trust with buyers and suppliers
✅ Avoid confusion, hidden charges, and delivery disputes

🚢 Common Incoterms in Agro Trade

Here are the most frequently used Incoterms for agro exports, with simplified definitions:

✅ EXW – Ex Works

• Responsibility: Buyer handles everything (pickup, shipping, customs).
• Risk Transfers: At the seller’s premises.

✅ FOB – Free On Board

• Responsibility: Seller delivers to port and loads onto ship.
• Buyer pays for freight and insurance.
• Risk Transfers: When goods are on board the vessel.

✅ CFR – Cost and Freight

• Responsibility: Seller pays freight to destination port.
• Buyer pays for insurance and import charges.
• Risk Transfers: Once goods are loaded on the ship.

✅ CIF – Cost, Insurance & Freight

• Same as CFR, but the seller also pays insurance.
• Risk Transfers: At port of destination.

✅ DAP – Delivered At Place

• Responsibility: Seller delivers to buyer’s location.
• Buyer pays: Import duties only.
• Risk Transfers: Upon delivery.

✅ DDP – Delivered Duty Paid

• Responsibility: Seller handles everything — shipping, customs, duties.
• Buyer: Just receives the goods.
• Risk Transfers: Final delivery point.

✅ FCA – Free Carrier

• Responsibility: Seller delivers goods to a nominated carrier (e.g. shipping agent).
• Risk Transfers: Once the carrier takes possession.

🌍 Which Incoterm Should You Use?

For agro product exports:

📌 For domestic trade, Incoterms are not commonly used. Instead, focus on payment terms and delivery methods (like LR-based dispatch).

🔐 Final Sales Tips

✅ Confirm Incoterm before quoting
✅ Make sure the quotation clearly matches the Incoterm
✅ Always consider customs duties, port fees, and insurance
✅ If unsure, start with FOB or CIF — they are most widely used and accepted

🎯 The better you understand Incoterms, the smoother your deals will be.
Use this knowledge to guide clients, quote confidently, and operate like a true global agro professional — the OBAOL Supreme way.

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