BAF (Bunker Adjustment Factor)
A fuel surcharge added to ocean freight rates so carriers can pass changes in ship fuel costs on to shippers.
TL;DR: BAF is a fuel surcharge on sea freight. It rises and falls with the price of bunker fuel and is charged on top of the base ocean rate.
Bunker is the fuel that powers ships. Since fuel is a large part of a carrier’s costs, carriers adjust the BAF on a regular schedule, often monthly or quarterly, based on fuel price indexes. Rules for low-sulfur fuel have also influenced these charges. BAF is usually quoted per container for FCL or per CBM or ton for LCL.
BAF is one of several surcharges you may see. CAF, the currency adjustment factor, covers exchange rate changes. PSS, the peak season surcharge, applies when demand is high, such as the months before year-end holidays. GRI, the general rate increase, is an announced rise in base rates across a trade lane. Other surcharges may apply for congestion, specific ports or security.
Because surcharges change often and can be listed separately, two quotes with similar base rates may end up quite different. Always ask your forwarder for an all-in quote that lists the base freight and every surcharge, plus how long the rate is valid. Check whether origin and destination local charges such as THC are included.
For buyers on CIF or CFR terms, the seller pays these surcharges within the freight. Under FOB, they fall on the buyer. See THC and Freight Forwarder.