Incoterms decide two things: where the cost transfers and where the risk transfers. They are not the same point on the journey, and the gap between them is where new importers lose money.
For natural stone the choice matters more than for most cargo, because stone is heavy, low value per tonne and prone to demurrage — the three conditions that turn a small logistics error into a large one. This guide covers the Incoterms stone importers actually meet, and how to choose between them.
FOB — Free On Board
You buy the goods loaded on board the vessel at Mundra, Kandla, Chennai, Krishnapatnam or Visakhapatnam. The seller pays for the stone, the packing, inland haulage to the port, export clearance and loading. From the moment the goods are on board, cost and risk are yours.
Buy FOB when you have your own freight forwarder, you ship regularly, and you have negotiated rates. This is what experienced importers do, because ocean freight bought directly by a volume shipper is usually cheaper than freight resold by an exporter.
There is a second advantage that rarely gets mentioned: FOB gives you control of the carrier. You choose the line, the routing and the transhipment. On an Indian lane where transhipment through Colombo, Jebel Ali or Singapore is common, that control has real value — both for transit time and for keeping your origin documentation clean under a trade agreement.
CFR — Cost and Freight
The seller pays the freight to your destination port. Risk still transfers when the goods are loaded in India.
That sentence is the whole point of CFR, and it catches people. If the container is damaged at sea, the seller has paid the freight but the loss is yours, and there is no insurance in the contract unless you bought it separately.
Never buy CFR without arranging your own marine insurance. It is the one term that quietly leaves you exposed.
CIF — Cost, Insurance and Freight
CFR plus insurance. The seller arranges and pays for marine cover to the destination port. Risk still transfers on loading in India — the insurance is bought for your benefit, which is a different thing from the risk being the seller’s.
Buy CIF when you are new to importing, you ship infrequently, or your bank requires it under a letter of credit.
Read the insurance clause carefully. CIF under Incoterms 2020 requires only Institute Cargo Clauses (C), a restricted named-perils cover, unless you agree otherwise. Stone is prone to handling breakage rather than to fire and sinking, so Clauses (C) may not cover what actually goes wrong. Ask for Clauses (A) — all risks — and expect to pay for it. Get the policy or certificate in your hands, and check the insured value covers cost plus freight plus a margin, not just the invoice value.
The other three you will meet
- EXW — Ex Works. You collect from the factory gate and handle everything from there, including Indian export clearance. Avoid EXW for Indian stone.
- FCA — Free Carrier. The seller delivers to a named place, cleared for export. For containerised cargo FCA is technically more appropriate than FOB. In practice the Indian stone trade quotes FOB and everyone understands it.
- DAP — Delivered At Place. The seller delivers to your yard, unloading and import duty excluded. Convenient, and you pay for the convenience. Import clearance and duty remain yours, which surprises people who assume “delivered” means delivered.
DDP is rarely appropriate on stone, because the seller cannot reliably predict your duty position and will price that uncertainty into the quote.
Which to choose
- First container ever — CIF, with all-risks cover specified
- Occasional importer with no forwarder relationship — CIF or CFR with your own insurance
- Regular importer with a forwarder — FOB
- Volume importer with negotiated ocean rates — FOB
- Anyone, ever — not EXW
The demurrage trap
This is where stone importers actually lose money, and no Incoterm protects you from it.
When your container arrives you get a limited number of free days at the terminal before demurrage starts, and a limited number of free days to return the empty container before detention starts. Both accrue daily, and both are charged regardless of whose fault the delay was.
Stone is unusually exposed because it is heavy and needs a specific truck, sometimes a permit; it often goes to a yard with limited unloading equipment; customs may select it for examination, and a stone container is slow to examine; and the importer frequently has nowhere to put 25 tonnes at short notice.
A week of demurrage on one container can exceed the entire duty saving from a trade agreement. Plan the unloading before the vessel sails: confirm your haulier, confirm your unloading equipment, confirm your customs entry is prepared, and know your free-time allowance. The weight arithmetic that drives all of this is in our guide to container weight versus volume.
Incoterms and your duty position
Incoterms affect the customs value on which duty is calculated, and the rules differ between jurisdictions. Many customs authorities assess on a CIF basis; some assess on FOB and add freight separately. Your broker will tell you which applies. If you buy FOB, be ready to evidence the freight and insurance costs so the customs value can be built correctly — keep the freight invoice.
Separately, Incoterms have nothing to do with origin. Buying CIF does not make the goods more Indian, and buying FOB does not make them less. Preferential duty depends on the rules of origin in the relevant agreement and on the proof of origin document. Where that currently stands for the main markets:
- United Kingdom — India–UK CETA has been in force since 15 July 2026, giving 0% on worked stone with a valid proof of origin.
- UAE — India–UAE CEPA, in force since 2022, gives 0% or a reduced rate against a 5% MFN rate, with an electronic certificate of origin.
- Germany and the EU — worked stone is already 0% under the Common Customs Tariff across all 27 member states.
- United States — roughly 18% under the US–India bilateral deal as at early 2026, down from a 50% peak. Verify the live HTS rate before you quote.
The mechanics are covered in our guide to the certificate of origin for stone imports and in import duty on Indian stone.
Writing the term correctly
An Incoterm without a named place is meaningless. Write it in full:
- FOB Mundra, India (Incoterms 2020)
- CIF Rotterdam, Netherlands (Incoterms 2020)
- CFR Jebel Ali, UAE (Incoterms 2020)
Always name the version. Incoterms 2010 and 2020 differ in ways that matter, notably the insurance level under CIP.
And check which Indian port your stone actually ships from. Rajasthan and Gujarat material moves through Mundra and Kandla. South Indian granite — Absolute Black from the Chamarajanagar and Dharmapuri belts, Black Galaxy from Chimakurthy, Steel Grey from Prakasam — moves through Chennai or Krishnapatnam. Quoting FOB Mundra for a Chimakurthy granite is a quote that has not been thought about.
Questions to put on your first order
- Which Indian port, and does it match where the stone is quarried and finished?
- Under CIF, what insurance clauses — and can I have Clauses (A)?
- What is the insured value: invoice, or invoice plus freight plus margin?
- Who pays terminal handling at origin and destination, explicitly?
- What free time do I have at the destination terminal, and on the container?
- When will documents be released, and by what route — bank, courier, or telex release?
That last question is a real cost. A container sitting at the terminal because the original bill of lading is in a courier bag somewhere is a container accruing demurrage.
How Gemarix quotes
We quote from the port the stone actually ships from, and we say which one on the quotation. We also release the full loading photograph set before documents, so if there is a claim you have evidence rather than an argument — the packing standard behind that is set out in our guide to sea packing for natural stone. If you are new to importing from India altogether, start with how to import natural stone from India.
Frequently Asked Questions
What does FOB mean when buying stone from India?
FOB means the goods are delivered on board the vessel at the Indian port. The seller pays for the stone, packing, inland haulage and export clearance. From the moment the goods are on board, ocean freight, insurance and all destination costs are yours. FOB suits importers who ship regularly and already have negotiated freight rates.
Is CIF or FOB better for importing granite?
CIF is simpler for a first or occasional shipment because the supplier arranges freight and insurance. FOB is usually cheaper for regular importers, because a volume shipper buys ocean freight more cheaply than an exporter reselling it. FOB also lets you control the carrier and routing, which matters on Indian lanes where transhipment is common.
What is the difference between CFR and CIF?
CFR means the seller pays freight to your port but does not insure the cargo. CIF is the same plus insurance. Under both, risk transfers to you when the goods are loaded in India, not on arrival. If you buy CFR you must arrange your own marine insurance, or you are carrying the loss uninsured.
Should I buy stone on EXW terms?
Generally no. EXW makes you responsible for Indian export clearance, which as a foreign buyer you are poorly placed to handle. It looks cheap on the quotation and rarely is. FCA is the cleaner alternative if you want to take control early.
Which Indian port will my stone ship from?
It depends on where the stone is quarried. Rajasthan and Gujarat material — marble, sandstone, Kota limestone and North Indian granite — ships from Mundra or Kandla. South Indian granite such as Absolute Black, Black Galaxy and Steel Grey ships from Chennai or Krishnapatnam. Vizag-belt granite ships from Visakhapatnam.