Ocean freight surcharges explained: what goes in your FCL and LCL quotes

4 November 2026 · By the Laneworks team · All articles

In short: BAF, LSS, CAF, PSS, GRI, THC, ISPS and Australian terminal charges, and how to show them so customers aren't surprised.

A sea freight rate is rarely one number. Carriers add surcharges for fuel, currency, peak season and security, and terminals add their own charges at each end. Customers who see an ocean rate and then an invoice full of extra lines feel misled, even when every line was legitimate. The fix is to know what each surcharge is and to show the ones that apply in the quote. Here's a plain-English guide.

Fuel and environmental surcharges

• BAF (Bunker Adjustment Factor): covers changes in the cost of ship fuel ("bunker"). Carriers revise it periodically, so it may differ between the quote date and the sailing.
• LSS (Low Sulphur Surcharge): introduced by many carriers to cover the cost of lower-sulphur fuel required under the IMO 2020 rules. Some carriers fold it into BAF.
• EBS (Emergency Bunker Surcharge): a temporary charge some carriers add when fuel prices spike.

Market and currency surcharges

• CAF (Currency Adjustment Factor): covers exchange-rate movements between the currency the carrier charges in and its costs.
• PSS (Peak Season Surcharge): added when demand is high, typically in the months before major holiday seasons.
• GRI (General Rate Increase): a carrier-announced increase to base rates on a trade lane from a set date. Not a separate line once applied, but a reason quotes expire.

Terminal and security charges

• THC (Terminal Handling Charge): the terminal's charge for moving the container on and off the ship. Origin THC (OTHC) and destination THC (DTHC) are separate; your Incoterm decides which your customer pays.
• ISPS: a security charge linked to the International Ship and Port Facility Security Code, charged by some carriers and terminals.
• Australian terminal charges: Australian container terminals charge transport operators fees such as infrastructure surcharges for each container collected or delivered, which carriers and transport companies usually pass on. Include them in door delivery pricing or list them separately.

LCL-specific charges

LCL adds the consolidator's own lines, usually charged per revenue tonne with minimums: origin and destination CFS charges, and sometimes fuel or documentation fees from the consolidator. Our guide to calculating an LCL quote covers W/M and minimums, and the free freight calculator works out revenue tonnes.

How to show surcharges in a quote

• List them separately from the base ocean rate. If BAF changes, the customer sees a surcharge move, not your price.
• Say which are "as applicable at time of shipment", and make the quote's validity match your buy rates. See freight quote validity.
• Group by where they're incurred: origin, ocean, destination. It makes the Incoterm split obvious. The Incoterms guide shows which side pays what.
• Or quote all-in, if your customer prefers one number, but keep the breakdown in your own working so you can explain it.

Every surcharge, from your own rate sheet

Laneworks drafts quote replies with every line, surcharges included, priced from your own rate sheet and labelled with the row it came from. See a sample draft, or forward a real quote request to try@getlaneworks.com and the draft comes back in about two minutes.

Forward a quote request