if i remember correctly we did have a discussion on this in one of the threads a while ago
havent gone through my posts but i believe i expressed concern re our implied exposure to the freight market
it works like this- the sales term may read FOB but the price we receive for our Mn is derived from a CIF price index i.e it includes a freight component. The higher the freight the less we receive
personally i would have never agreed to a contract term like this. We simply dont know anything about freight and cant controll it.
Ann: Revised Shipping Strategy Yields Substantial Cost Reduction, page-19
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