Bunker Adjustment Factor (BAF)
BAF is a surcharge on ocean freight that adjusts for changes in ship fuel (bunker) prices. Lines review it periodically, for example monthly or quarterly, and charge it per container or per W/M for LCL. Since the IMO 0.50% sulphur cap took effect on 1 January 2020, many lines have restructured their BAF formula or added similar surcharges under other names. When comparing quotes, check whether BAF and other surcharges are included or listed separately.
Related terms
- Terminal Handling Charge (THC)
The THC is the charge for handling a container at the terminal, such as lifting it on or off the vessel and moving it within the yard, usually billed by the shipping line to the s…
- FCL (Full Container Load)
FCL means one shipper books a whole container, however much cargo is inside.
- LCL (Less than Container Load)
LCL is a shipment too small to fill a container, so a forwarder or NVOCC consolidates it with other shippers' cargo at a container freight station (CFS).
- Freight Forwarder
A freight forwarder organises shipments on behalf of cargo owners: booking ship or aircraft space, arranging trucking, documents, insurance and LCL consolidation.