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Glossary Shipping Terms

Currency Adjustment Factor (CAF)

Shipping and freight is a global industry and as such, it involves trading in many currencies. US Dollar, Euro and Pound are the most common of the currencies involved in trading.

Since each country has its individual rate of exchange and these three main currencies fluctuate the shipping industry had to find a way to offset monetary losses due to this fluctuation.

Currency Adjustment Factor (CAF) is a charge levied by some of the shipping lines on some of the trade lanes to cover such financial losses. The quantum of CAF could be on percentage basis or per container basis.

Related reading: 

Terminal Handling Charges (THC) Explained

The Anatomy Of A Sea Freight Invoice

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