FOB Karachi
— definition for Pakistani agri exporters.

Definition

FOB Karachi — Free On Board, Karachi — is the Incoterms® rule under which the seller (Pakistani exporter) bears all costs and risks of placing the goods on board the named vessel at the named loading port (Karachi). Once the goods are on board, the buyer assumes risk and cost. FOB applies only to sea and inland waterway transport.

Under Incoterms® 2020, the seller's obligations under FOB Karachi include: (1) supplying conforming goods and the commercial invoice; (2) handling export clearance — Goods Declaration via WeBOC, customs duties (if any), all export licences and permits; (3) loading and stowing the goods on board the vessel at Karachi Port (typically KICT, QICT or PICT terminal); (4) bearing all risk until the goods are placed on board; (5) supplying proof of delivery — typically the carrier's Bill of Lading.

Why it matters for Pakistani exporters

FOB Karachi is the most-quoted price basis for Pakistani agricultural exports — spices, seeds, salts, dried botanicals — because it cleanly separates Pakistan-side responsibility (which the exporter controls) from the international ocean leg and destination clearance (which the buyer or buyer's freight forwarder controls). Karachi Port Trust handles the bulk of Pakistan's container traffic, with Port Qasim taking the rest.

Buyers prefer FOB when they have their own freight contracts (typically large traders, multinational food companies, GCC consolidators) because they can negotiate ocean freight directly. CFR and CIF (where the seller arranges the freight) are more common for smaller buyers without freight desks.

Practical guidance

What FOB Karachi includes (seller pays):

• Goods cost, packaging (PP woven bags, jute bags, cartons), palletising if requested.
• Inland transport — warehouse in Hyderabad/Faisalabad/Multan to KICT/QICT/PICT terminal.
• Pakistan customs export clearance, WeBOC GD, port charges (THC at origin), VGM.
• Stuffing (CY), terminal handling, stevedoring up to ship's rail.
• All Pakistan-side documents: phytosanitary certificate, fumigation certificate, Halal certificate, COO, COA, commercial invoice, packing list.

What FOB Karachi excludes (buyer pays):

• Ocean freight from Karachi to destination port.
• Marine insurance.
• Destination terminal handling, demurrage, customs clearance, duties, VAT/GST.
• Inland delivery at destination.

An FOB Karachi quote should always specify the loading terminal (KICT vs QICT vs PICT) — port charges differ slightly and stuffing capacity varies.

Source & standards reference

Reference: Incoterms® 2020, International Chamber of Commerce (ICC), Paris — Publication 723. The rule FOB is for sea and inland waterway transport only; for container shipments handed over at a CY (container yard), FCA may technically be more accurate but FOB is industry-standard for Pakistani agri exports.

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