A more thorough explanation:

Definition: Cost and Freight (CF) is a term used in business contracts that outlines the responsibilities of the buyer and seller regarding the delivery, payment, and risk of loss of goods. The seller is responsible for clearing the goods for export, arranging transportation by water, and paying the shipping costs to the port of destination. Once the goods are safely loaded onto the receiving ship, the seller's delivery is complete, and the risk of loss passes to the buyer. This term is only used when goods are transported by sea or inland waterway.

Example: A company in China sells 1000 units of a product to a company in the United States. The contract states that the terms are Cost and Freight. The Chinese company is responsible for clearing the goods for export, arranging for transportation by sea, and paying the shipping costs to the port of destination in the United States. Once the goods are loaded onto the ship, the Chinese company's delivery is complete, and the risk of loss passes to the US company.

Explanation: In this example, the Chinese company is responsible for all costs associated with shipping the goods to the United States, including the cost of loading the goods onto the ship. The US company is only responsible for paying for the goods once they arrive at the port of destination. If anything happens to the goods during transit, the Chinese company is responsible for any losses or damages.