Trade glossary · measurement

FOB

Also known as: Free On Board

Free On Board — a valuation rule for exports. Includes the cost of goods up to the point of loading at the exporter's port; excludes international freight and insurance.

FOB is the standard for export valuation in most national statistics. It values goods as they cross the exporting country's border — production cost plus inland transport plus loading. CEPII BACI normalizes flows to FOB on the export side. Importing countries instead report CIF, which adds international shipping and insurance, so importer-reported values are systematically higher.

Examples

  • A Toyota leaving Yokohama port valued at $30,000 FOB.
  • When importer USA reports CIF, the same car might be valued at $31,200 (CIF includes ~4% freight + insurance).

Related terms

CIF
Cost, Insurance and Freight — a valuation rule for imports that includes the cost of goods plus international shipping and insurance.
Mirror trade statistics
Comparing one country's reported exports to a partner against the partner's reported imports from the same country. CEPII BACI reconciles the two using a weighted estimator.