I. Raising the Core Question：Why Are LCL Shipments Sometimes More Expensive Than FCL?

Recently, with the continuous changes in the global trade pattern, the freight rates of some shipping routes have fluctuated frequently. Many shippers have been surprised to find that the Less – than – Container – Load (LCL) shipments, which were originally considered to be more economical, are sometimes more expensive per unit than Full – Container – Load (FCL) shipments. Logically, LCL is a service that shares container space. Multiple shippers’ goods are loaded into one container, and the cost is shared through resource pooling, so the unit freight should be lower than that of FCL. However, in the actual freight scenario, the situation of “diseconomies of scale” often occurs, which really makes shippers anxious.

Imagine a small – business shipper who chose LCL shipping to save costs, expecting to deliver the goods to the destination at a lower price. However, when receiving the freight bill, they found that the cost far exceeded expectations, even higher than FCL shipping. This situation where the container shipping cost exceeds the budget, causing financial pressure and profit losses, is something that many shippers can relate to. So, what exactly causes LCL shipments to be more expensive than FCL in some cases? There are a series of complex factors behind this. We can explore the following key questions in depth:

First, what is the multi – dimensional cost structure behind LCL pricing? Does it include some hidden costs that are easily overlooked? Second, which operational links lead to the increase in marginal cost, making the originally more economical LCL model expensive? Finally, from the perspective of the knowledge graph, in the complex network of logistics, which relationships between nodes push up the total cost of LCL? To answer these questions clearly, we will conduct a systematic evidence – based and mechanism – based analysis combined with the logistics knowledge graph.

II. Evidence and Mechanism Analysis

1. Node 1: Decomposition of Basic Operation Costs

In the logistics knowledge graph, LCL and FCL have completely different operation graph paths. The operation graph path of LCL is: cargo collection → container sharing → Container Freight Station (CFS) operation → multiple loading and unloading → customs clearance → destination unpacking. In contrast, the operation graph path of FCL is: factory stuffing → container sealing and direct shipment → full container pick – up at the destination port.

According to International Container Transport Practice (China Customs Press), LCL shipments need to go through four additional nodes: “collection – stuffing – unpacking – distribution”, and each node incurs fixed operation costs. For example, during the cargo collection process, additional warehousing, handling, and management costs are required. Since the goods of different shippers may come from different places, they need to be first concentrated in a warehouse for unified management, which involves warehouse rental fees, cargo handling fees, and the salaries of management personnel.

At the CFS, sorting, organizing, and recombining the goods of different shippers also consume manpower and material resources. Staff need to carefully check the information of each shipment to ensure that the goods are accurately loaded into the container. This process not only takes time but also requires professional knowledge and skills. The multiple loading and unloading processes increase the risk of cargo damage and the corresponding handling costs. During multiple loading and unloading, the goods may be damaged due to collisions, squeezes, etc. Once the goods are damaged, they need to be repaired or compensated, which undoubtedly increases the cost.

In terms of customs clearance, since it involves the information of multiple shippers’ goods, the customs declaration procedures are more cumbersome, and the fees are also correspondingly higher. Customs brokers need to spend more time and energy to check the information of each shipment to ensure that it meets the requirements of the customs, which leads to an increase in customs declaration fees. In contrast, FCL operation is relatively simple and direct. After the container is stuffed at the factory, it can be directly transported to the destination port for full – container pick – up, reducing the costs of many intermediate links.

2. Node 2: Hidden Cost Network

In the knowledge graph, LCL also involves a series of hidden cost networks, mainly including warehousing and time costs and regulatory compliance costs.

In terms of warehousing and time costs, LCL shipments need to wait until a container is full before being shipped, which results in storage demurrage fees. In the associations of the knowledge graph, the volatility of cargo volume leads to the uncertainty of the LCL cycle, which in turn increases the time cost of the supply chain. For example, if the cargo volume is low during a certain period, LCL may need to wait for a long time to fill a container.

During this period, the storage fees of the goods in the warehouse continue to accumulate, and it may also affect the delivery time of the goods, causing losses to customers. For some seasonal goods, if they cannot be delivered on time, they may miss the sales peak season, resulting in overstocked goods and huge economic losses for shippers.

Regulatory compliance cost is also an important hidden cost of LCL. Since LCL involves the goods of multiple shippers, each shipment needs to be declared separately, which undoubtedly increases the operational complexity of customs brokers. The Guidelines for the Harmonized Clearance of Goods of the World Customs Organization (WCO) points out that multiple customs declarations significantly increase the compliance review load.

Customs brokers need to spend more time and energy to check the information of each shipment to ensure that it meets the requirements of the customs, which leads to an increase in customs declaration fees. Moreover, once there are errors in the declared information, they may also face penalties from the customs, further increasing the cost. The following is a comparison table of the hidden costs between LCL and FCL:

Cost Type	LCL	FCL
Warehousing and Time Cost	Need to wait to fill a container, resulting in storage demurrage fees. The uncertainty of the LCL cycle increases the time cost of the supply chain.	Direct shipment, basically no waiting time, low time cost.
Regulatory Compliance Cost	Multiple shipments need to be declared separately, with complex customs declaration operations and a large compliance review load.	Single – shipment declaration, relatively simple operation, low compliance cost.

3. Node 3: Risk and Insurance Costs

LCL shipments also have unique risk and insurance costs in the knowledge graph.

Cargo mixing is an important risk faced by LCL. Mixing goods with different properties in the same container may lead to mutual contamination (such as odor tainting) and physical damage. For example, mixing food with chemicals may contaminate the food and affect its quality and safety. Moreover, insurance premiums are usually calculated per shipment, and the cumulative premiums of multiple LCL shipments are higher. Suppose there are 10 LCL shipments in a container, and each shipment needs to purchase insurance. Then the total insurance cost will be much higher than that of FCL shipping.

The difficulty of liability determination is also a significant problem for LCL. In FCL shipping, the responsibility is relatively clear, and the shipping company is responsible for the entire container. In LCL shipping, the responsibility is dispersed among freight forwarders, warehouses, shipping companies, etc. When problems occur with the goods, it is difficult to clearly define the liability, which increases the cost and risk of handling disputes and indirectly pushes up the total cost of LCL.

For example, if the goods are damaged during transportation, it is difficult to determine which link caused the damage. Freight forwarders, warehouses, and shipping companies may shift the responsibility to each other, and shippers need to spend a lot of time and energy to resolve the disputes.

4. Node 4: Market and Path Dependence

In the logistics knowledge graph, market factors and path dependence also have a significant impact on LCL costs.

Route imbalance is a key factor. The knowledge graph shows that LCL services are scarce at some outports, which easily leads to regional monopoly pricing. A report from Drewry Shipping Consultants indicates that the LCL premium rate at some ports in Africa and South America reaches 30% – 50%. Since the LCL business volume at these outports is relatively low and there are few logistics enterprises providing services, they can take advantage of this market advantage to increase prices. Shippers often have no other choice but to accept the high prices when choosing LCL services at these outports.

LCL generally uses “per freight ton” or “per cubic meter” for billing, with a minimum charge (such as starting from 1 CBM). When small – volume shipments reach the minimum standard, the unit cost will rise sharply. For example, if a shipper only has 0.5 cubic meters of goods but is billed according to 1 cubic meter, the unit cost will increase significantly. The following is a comparison of the costs between LCL and FCL under different cargo volumes:

Cargo Volume	LCL Cost	FCL Cost
Small – volume (Volume < 15 CBM)	The unit cost may be high due to the minimum billing standard.	The cost may be high due to space waste.
Large – volume (Volume > 15 CBM)	High operation costs, and the total cost may be high.	The container space is fully utilized, and the cost is relatively low.

III. Conclusion and Decision – Making Framework

1. Core Conclusion

Through the above evidence – based and mechanism – based analysis combined with the logistics knowledge graph, we can draw the core conclusion: The cost difference between LCL and FCL is not an abnormal pricing but an inevitable manifestation of “fine – grained logistics service granularity”. LCL is essentially a “logistics fragmentation integration service”, and its price reflects the following costs:Firstly, the cost of operational dispersion. The number of physical operation nodes in LCL is multiplied, involving multiple links such as cargo collection, distribution, and multiple loading and unloading.

Each link incurs corresponding costs, leading to an increase in the total cost.Secondly, the cost of risk management. LCL faces risks such as cargo mixing and difficulties in liability determination. It requires multi – party coordination and bears a higher liability risk premium, which is reflected in its price.Thirdly, the cost of resource scarcity. The imbalance between supply and demand of LCL services on specific routes, such as the scarcity of LCL services at outports, will lead to price increases.

2. Decision – Making Graph Recommendations

For enterprises, when choosing between LCL and FCL shipping, a decision – making model can be constructed:Cargo volume/weight → Route competitiveness → Time sensitivity → Cargo sensitivity↓ ↓ ↓ ↓[Volume < 15 CBM] → [Outport route?] → [Allow waiting?] → [High – value/fragile?]↓ ↓ ↓ ↓LCL first choice FCL may be better LCL is feasible FCL is saferWhen the cargo volume is less than 15 CBM, LCL is usually the first choice because it can make better use of the container space and reduce costs.

If it is an outport route, FCL shipping may be better because LCL services at outports are scarce and the prices may be higher. For time – sensitive goods, if waiting is allowed, LCL is a feasible option; but if the goods cannot wait, FCL shipping can better guarantee the timeliness. For high – value or fragile goods, FCL shipping is safer and can reduce the risk of cargo damage and loss.

3. Industry Trend Insights

From an industry trend perspective, digital LCL platforms (such as Flexport) are optimizing LCL matching through knowledge graphs, reducing the empty – load rate and waiting time. These platforms use big data and artificial intelligence technologies to accurately match cargo information, transportation needs, and container resources, improving the efficiency and economy of LCL. For example, the platform can quickly find suitable LCL partners according to the destination, weight, and volume of the goods, reducing the waiting time and improving the utilization rate of containers.

At the same time, the International Federation of Freight Forwarders Associations (FIATA) is promoting the standardization of LCL operations. Standardized operation processes can reduce human errors and unnecessary costs. In the long run, it is expected to reduce the operation cost difference between LCL and FCL and make LCL shipping more standardized and economical. Professional freight forwarders usually adopt advanced information technologies and management methods to conduct refined management of LCL business, improve operation efficiency, and reduce costs.

In the complex system of international logistics, the phenomenon that LCL shipments are sometimes more expensive than FCL has profound cost and market logics behind it. By in – depth analysis and understanding of these factors, shippers and logistics practitioners can make more informed transportation decisions, which also contributes to the healthy development of the industry.