The efficiency and cost control of maritime shipping—the lifeblood of global trade—largely depend on meticulous management of container delivery terms. Among the various options, CYCY (Container Yard to Container Yard) and CY/LO (Container Yard/Lift On) represent two fundamental approaches that significantly impact operational outcomes.
The Leverage Point: How Delivery Terms Shape Global Trade Costs
Picture a massive cargo vessel entering port—the ultimate cost and delivery efficiency of its goods often hinges on seemingly simple shipping terms. Choosing between CYCY and CY/LO isn't merely selecting terminology; it's adopting distinct cost structures, risk allocation frameworks, and collaboration models with global trade partners.
CYCY: The Standardized Solution for Risk Management
The CYCY term, or "yard to yard," offers a straightforward delivery process:
- Export Customs & Container Delivery: After completing export procedures, shippers deliver loaded containers to the carrier's designated yard.
- Loading Operations: The carrier handles vessel loading.
- Destination Unloading: Upon arrival, the carrier unloads and stores containers at the destination yard.
- Customs Clearance: Consignees must complete clearance and retrieve goods within the free storage period.
Cost Structure
CYCY freight rates typically include origin loading, ocean freight, and destination unloading/storage fees. With carriers assuming greater responsibility, CYCY rates generally exceed CY/LO by 15-20% on average.
Time Efficiency
CYCY offers stable transit times—Shanghai to Los Angeles averages 18-22 sailing days plus 5-8 days for port operations, totaling 25-30 days. However, during the 2022 Long Beach port congestion, delays extended to 45 days, generating average demurrage fees of $800/container.
Risk Allocation
Carriers bear most transportation risks under CYCY, though cargo insurance remains advisable. Special attention should be given to free storage periods—Rotterdam charges €120/day for refrigerated containers exceeding its 4-day allowance.
CY/LO: The Cost-Optimized Alternative
CY/LO ("yard to shipside lift-off") shifts destination unloading responsibility to consignees:
- Export procedures mirror CYCY
- Carriers deliver goods shipside only
- Consignees arrange and pay for unloading (Lift Out Charge)
Financial Considerations
While CY/LO ocean rates run 12% lower than CYCY (Shenzhen-Singapore 20GP example), consignees incur destination fees like the S$450 unloading charge and S$80 lifting fee. Hidden costs may include 15% security fees at Jakarta or original B/L requirements at Bangkok.
Operational Risks
A 2022 Mumbai case saw $2,100/container demurrage fees when consignees delayed unloading payments. Contracts should specify: "Destination lift-out fees payable within 48 hours of arrival."
Strategic Selection Framework
Analysis of 200+ trade cases reveals a three-dimensional decision model:
- High-value goods: CYCY preferred for shipments exceeding $50,000/container
- Southeast Asia routes: CY/LO reduces costs 9-14% for low-value commodities
- Emerging markets: CYCY improves trust—2023 data shows 23% higher renewal rates
- Seasonal goods: CYCY ensures holiday merchandise arrives 5-7 days earlier
Documentation & Digital Management
Precise bill of lading terms are critical—CYCY requires "yard to yard" notation while CY/LO must specify "Lift Out Charge Collect." Digital tracking systems can reduce CY/LO communication costs by 40%, with blockchain B/L systems accelerating payment processes by 3-5 days.
Dual-Term Strategy for Market Volatility
Leading exporters now maintain both options, with CY/LO quotes including destination fee estimates. One hardware manufacturer achieved 19% higher client satisfaction alongside 13.5% logistics savings through this approach.
Final decisions should weigh three factors: client history (3+ years favors CY/LO), agent qualifications (ISO9001 certified), and route stability (CY/LO risk decreases 40% on regional routes).