barges on Dnipro river Ukraine

Estimation of delivery cost of goods by the inland waterways. Optimization of the river logistics routes

A simple question "How much does it cost?" in case of delivery by water transport has a complex answer. To obtain the delivery cost by the waterway, many other factors should be taken into account additionally to the amount of cargo and destinations. For example, cargo properties, loading and discharging rates, seasonality, the need for ballast voyages, etc. Concerning the cost of delivery, you need to understand the difference between delivery by own vessel or by vessel in the bareboat, time, or voyage charter. You can read more about in our blog "the self-expenses and price of freight by water transport."

Receiving a freight rate, you shall pay attention to the "but" attached! Almost every charter party has clauses for adjusting its rate, even if it is a "lumpsum" price. They are the demurrage rate (payment for an extra time of using the vessel). Correction for fluctuations of the fuel price. The low water clause that is often applicable on rivers with large and unregulated water level fluctuations, such as the Danube. There are also other remarks that should not be neglected. Otherwise, the freight's final cost turns out to be higher than expected, and instead of profit charterer gets a loss. You shouldn't expect everything to go perfectly. Something is bound to go wrong. At the same time, it is impossible to include all the risks in the cost at once since the price of the product will immediately rise to uncompetitive.

To obtain a freight rate, when it is clear: what, how much, when, and where to ship, it is better to contact the freight brokers or directly shipowners. But if you do a feasibility study, developing a new delivery chain and you need not only today's freight rate but a deep understanding of principles of the rate formation and dependencies, then you are welcome. We will help you to calculate the cost of delivery by inland waterways, including the risk, fluctuation, and breakeven analysis.