The cheapest origin is not the one with the lowest FOB, but the one with the lowest landed cost in your warehouse once freight, tariff, time, risk and requirements are added. It is decided with the same calculation for each country.
Goal: Compare two origins with the same landed-cost calculation, including the preferential tariff and the financial cost, and decide which suits you.
The lowest FOB is not always the cheapest origin. Comparing countries means repeating the calculation from topic 4-2 for each option, with the same currency, the same Incoterm and the same quantity. Only then are the quotes comparable. Then you add what the invoice does not show: time, risk, quality and requirements.
There are five numeric variables. The FOB price and the minimum order (MOQ, the minimum quantity the supplier agrees to sell). The freight and insurance, which change with the route, the port and the shipping line. The tariff: the general Ad Valorem of 0%, 6% or 11%, or a lower one if there is a trade agreement. The trade measures, such as anti-dumping or countervailing duties, which only affect certain products from certain countries. And the payment currency, which brings exchange rate risk.
Peru has trade agreements with several countries and blocs. If your supplier is in one of them, your product may pay a lower Ad Valorem or 0%, but only if it meets the agreement's rule of origin and you present the proof of origin (a certificate or a declaration, depending on the agreement). The International Preferential Treatment (TPI) code is recorded on the DAM. The country of origin is where the goods were produced, not where they were shipped from. This topic is covered in depth in the course “Customs Taxes, Trade Agreements and Origin”.
Time also costs money. Each day of transit is tied-up capital and one day less to react to demand. Look at transit days, the frequency of departures and the supplier's production time. A shorter route can help, but compare the real freight and the available departures. And do not concentrate everything in a single origin: a route or production crisis leaves you without goods.
Also check the technical requirements. Your product must meet Peruvian regulations and labeling no matter where it comes from (course “Quality, Technical Requirements and Agro-exports”). A cheap supplier that does not meet the standard costs you rework, returns or fines. To decide, use a weighted matrix: weighted criteria, a score from 1 to 5 per country, and a total. Give the greatest weight to the landed cost, and never decide on the FOB alone.
| Criterion | What to compare | How it affects your cost |
|---|---|---|
| Price and minimum order | Unit FOB and MOQ | It defines the outlay and the tied-up capital |
| Freight and route | Port, shipping line, transit days, frequency | It changes the freight, the insurance and the financial cost |
| Tariff | General Ad Valorem versus the agreement's preferential rate | It can reduce or eliminate the Ad Valorem with proof of origin |
| Trade measures | Anti-dumping or countervailing duties | They are added to the cost of the affected product |
| Technical requirements | Regulations, labeling, testing | Costs of adapting the product or risk of rejection |
| Payment and currency | Payment terms, currency | Financial cost and exchange rate risk |
| Quality and compliance | Samples, inspection, record of lead times | Returns, delays and lost sales |
Result: Supplier B, with an FOB 7.7% higher, turns out 5.5% cheaper thanks to the preference, the lower freight and fewer days of capital. But that advantage depends on the proof of origin: without it, A wins. That is why you ask for a sample and the certificate before paying.
14/11/2024
COSCO SHIPPING Ports reported that the port of Chancay was inaugurated on 14/11/2024, with Xi Jinping and Dina Boluarte taking part by video link. The press release states that, with two direct container routes between Shanghai and Chancay, cargo from Peru to China would arrive in 23 days. The press release does not compare that time with the previous route, nor does it report freight rates.
A new port or route can shorten transit, but compare the freight, frequency and local costs with real quotes before changing origin or port.
Source: COSCO SHIPPING Ports – Ceremonia de inauguración del puerto de Chancay (15/11/2024)
2026
SUNAT explains that, to enjoy a tariff preference, the International Preferential Treatment (TPI) code of the agreement is recorded on the DAM. The proof of origin varies: in the FTA with the US it is issued by the producer, the exporter or the importer, and in the agreements with Singapore, China, Thailand and Mexico it must be issued by an entity authorized by the respective government. In the Pacific Alliance it is issued by the competent authority of the exporting country.
Before counting on 0%, find out what proof the agreement for your origin requires and ask the supplier for it before shipment.
2026
MINCETUR explains in its frequently asked questions on the agreement with China that the tariff phase-out is linear: it eliminates tariffs in equal parts over a defined period. To access the preference you must obtain a Certificate of Origin before shipment, issued by an authorized certifying entity, valid for one year from its issue. For shipments of up to US$ 600 a Declaration of Origin is enough.
Do not take a product's tariff for granted: check what stage of its schedule it is in and get the certificate before the shipment leaves.
Source: MINCETUR – Acuerdos Comerciales del Perú: Preguntas frecuentes del TLC con China
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