FOB Mersin vs CIF Jebel Ali vs DDP Riyadh: the Incoterms math

CIF (Cost, Insurance, Freight) to the destination port. The seller (Aegellia) books the ocean freight, arranges Institute Cargo Clauses (A) marine insurance, and hands the buyer a B/L plus insurance certificate at the destination port. The buyer clears local customs and pays import duty. CIF is the standard for first-time GCC and EU buyers because it removes ocean-freight booking uncertainty.

Free On Board Mersin means Aegellia delivers the cargo on board the vessel at Mersin port. Risk and cost pass to the buyer as soon as the cargo crosses the ship's rail. The buyer arranges and pays for ocean freight, marine cargo insurance, destination port handling, customs clearance and import duty. FOB suits buyers with their own freight forwarder and an existing ocean-freight contract.

Delivered Duty Paid means Aegellia delivers the cargo to the buyer's nominated address with all duties, taxes and clearance paid. Risk transfers at the buyer's door. DDP requires Aegellia to register for VAT/import in the destination country, which is operationally feasible in the UAE, KSA and EU but adds 6–10% to the price. DDP suits buyers who want a single landed price and zero customs exposure.

Indicative 2026 ocean freight from Mersin per 20-foot container: Jebel Ali USD 850–1,400, Jeddah USD 650–1,100, Hamad USD 900–1,500, Ningbo USD 2,100–3,400. For a 22,000 kg flexitank cargo, this translates to roughly USD 0.04–0.16/kg added on top of FOB to reach CFR (Cost & Freight). Marine insurance adds another USD 0.03–0.06/kg under ICC-A.

Institute Cargo Clauses (A) — also known as 'all-risks' coverage. ICC-A covers physical loss or damage from any cause except specific exclusions (wear and tear, inherent vice, war, strikes, delay). For olive oil, ICC-A protects against container damage, port-handling incidents and thermal damage when paired with a data-logger condition. Premium typically 0.18–0.35% of CIF value.

Under EXW, FOB, CFR, CIF, CPT, CIP — the buyer pays import duty at destination. Under DPU, DAP — the buyer also pays import duty. Under DDP — Aegellia pays import duty as part of the price. For olive oil under HS 1509 in the GCC, the MFN duty is 5% across all six countries. The EU duty is 0% under the Türkiye Customs Union (A.TR document required).

Under CIF, claim against the insurance policy (ICC-A) Aegellia provides at handover. The buyer files the claim using the insurance certificate, the B/L, the commercial invoice and the survey report. Under FOB, the claim goes to the buyer's own insurer. Under DDP, Aegellia handles the claim as a back-office matter; the buyer is unaffected. Aegellia keeps the lot witness sample for 24 months for quality-claim verification.

Not on the same commercial invoice. Incoterms apply to the contract of sale, which means the entire shipment moves under one rule. A buyer running multiple shipments can use different Incoterms per shipment — e.g. FOB on bulk flexitanks and DDP on retail-pack samples — but each invoice must specify a single Incoterm with the named place.