Taking the term apart
CIF is an Incoterms 2020 rule for sea freight: cost, insurance and freight. The seller pays the freight to the named destination port and buys minimum insurance for the buyer, which is cover on the Institute Cargo Clauses (C). Tianjin is the named port, a large port in northern China.
Risk still passes to the buyer once the cargo is on board at the port of shipment. A CIF contract does not make the seller responsible for the cargo at sea: the freight and insurance are part of the price, and the insurance protects the buyer.
Why benchmarks use CIF China
China is the main importer of ores such as manganese, so index publishers quote a delivered price at a Chinese port. Fastmarkets' high-grade manganese ore index is CIF Tianjin in dollars per dmtu, and USGS quotes manganese and iron ore benchmarks delivered to China. A single delivered basis lets producers in different countries be compared on the same footing.
Converting CIF Tianjin to FOB at the mine port
FOB equals CIF minus the sea freight and insurance premium. With a CIF price of $205 per tonne, freight of $35 and insurance at 0.15% of 110% of the CIF value, the FOB equivalent is about $169.66 per tonne. The freight changes with the route, the ship size and the market, so use a current quote for the route from your loading port to Tianjin.
This is the reason two prices for the same ore can look very different. A FOB offer from an African port and a CIF Tianjin benchmark are not comparable until freight is removed.
What CIF Tianjin does not include
Port charges, import duties and inland transport after discharge are not part of a CIF price unless the contract says so, and the price is on the specified grade and quantity. Check the assay basis, the penalty terms and the payment method as well as the Incoterm.
Related calculators
Frequently asked questions
What does CIF Tianjin mean?
Cost, insurance and freight to the port of Tianjin in China: a delivered price at the discharge port that includes sea freight and minimum insurance.
Who bears the risk under CIF?
The buyer, from the moment the cargo is on board at the port of shipment. The seller pays for the freight and the insurance, but the insurance is for the buyer's benefit.
How do I convert CIF Tianjin to FOB?
Subtract the sea freight and the insurance premium from the CIF price. The CIF and FOB calculator on this site does it.
Why do index publishers quote ore CIF China?
China is the largest importer of many ores, and a delivered price at a Chinese port gives producers from different countries a common basis.
Sources
- ICC: Incoterms 2020 introduction
- Fastmarkets: manganese ore high grade index, CIF Tianjin, $ per dmtu
- Project Materials: Incoterms 2020 types and risks
- USGS Mineral Commodity Summaries 2026: Manganese
Specifications published by index providers are revised over time. Where a figure comes from a pricing notice, confirm the version currently in force with the publisher before you use it in a contract. Corrections are welcome.