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Freight Rates and Surcharges Flashcards

6 cards from real Ocean Sea Freight practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

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  1. What does 'All-In Rate' mean in ocean freight pricing?

    Answer: A single bundled freight rate that includes base ocean freight plus all applicable surcharges

    An All-In Rate combines the base ocean freight rate with all surcharges (BAF, CAF, PSS, etc.) into a single quoted price, simplifying budgeting and comparison between carriers.

  2. What is BAF (Bunker Adjustment Factor) in ocean freight?

    Answer: A fuel surcharge added to the base rate to account for fluctuations in vessel fuel (bunker) costs

    BAF (also called Fuel Surcharge or EBS) is a variable surcharge carriers add to the base rate to recover the cost of fuel — it fluctuates based on global oil prices and route.

  3. What is a 'Peak Season Surcharge' (PSS) in ocean freight?

    Answer: A temporary surcharge added during high-demand shipping periods to offset increased costs

    PSS is a temporary surcharge carriers impose during periods of high demand (e.g., pre-Christmas rush or post-Chinese New Year) when vessel space is tight and costs are elevated.

  4. What is 'GRI' (General Rate Increase) in ocean freight?

    Answer: A periodic, across-the-board increase in base freight rates announced by carriers

    A GRI is a carrier-announced increase in the base ocean freight rate, typically applied at a fixed date and expressed as a dollar amount per TEU or FEU.

  5. What is the 'CBM' (Cubic Meter) measurement used for in LCL freight pricing?

    Answer: LCL rates are typically quoted per CBM or per 1,000 kg (W/M basis) — whichever is higher

    LCL freight is rated on a Weight/Measure (W/M) basis — the rate applies per CBM of volume or per 1,000 kg of weight, with the higher figure used, reflecting whichever takes more physical space on the vessel.

  6. What is a 'THC' (Terminal Handling Charge) in ocean freight?

    Answer: A fee charged by the terminal for handling containers during loading and discharge at the port

    THC covers the terminal operator's costs for moving containers within the port — including crane operations, container yard handling, and equipment use — and is separate from the ocean freight rate.