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Glossary Shipping Terms

Bunker Adjustment Factor Surcharge (BAF)

The term "Bunker" refers to the fuel that is used to operate ships. Bunkering is the action of supplying a ship with bunkers. The ship operator is responsible for the payment of these bunkers to the bunker supplier.

As fuel prices are quite volatile, the shipping lines charge a fee called "Bunker Adjustment Factor (BAF)" to cover the fluctuations in global bunker costs.

This BAF is charged either as a separate charge or included in the freight charge depending on the trade route.

Related articles:

Terminal Handling Charges (THC) Explained

The Anatomy Of The Sea Freight Invoice

Oil Prices And The Effect On Shipping Rates

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