由 caicai8478 Have you ever been confused when you received an international freight quote? You agreed on a good “ocean freight” or “air freight” rate, but the final bill was much higher. These extra costs are what we commonly call surcharges.
They aren’t intentionally “hidden” by shipping companies or freight forwarders; rather, they are simply additional costs incurred during transportation beyond the basic freight rate. Understanding these surcharges is the first step to becoming a savvy importer and exporter.
I. Why Are Surcharges Existing?
Surcharges can be understood as a form of “cost-sharing” in the transportation process. When the entire industry faces certain specific, temporary, or highly volatile costs, carriers (shipping companies/airlines) will establish corresponding surcharges to fairly distribute these costs among all shippers.
Main reasons include:
Fuel price fluctuations: This is the largest variable cost.
Currency exchange rate changes: Especially local charges incurred at the destination port.
Seasonal demand: Such as tight space during peak seasons.
Specific route risks: Such as passing through war zones or pirate areas.
Port/airport congestion: Causes delays in shipping/flight schedules and increases costs.
Government regulatory changes: Such as new environmental regulations.
II. Common Surcharges “Dictionary” (Ocean Freight)
- Fuel Surcharge
What is it: A fee levied due to fluctuations in fuel prices, and it accounts for the largest proportion of surcharges.
Common English terms: Bunker Adjustment Factor (BAF) or Fuel Adjustment Factor (FAF).
Note: Different carriers use different calculation methods; it is usually linked to the fuel price index and is adjusted periodically.
- Currency Depreciation Surcharge
What is it: A fee levied to cope with exchange rate fluctuations, especially changes in the exchange rate between the settlement currency (usually US dollar) and the carrier’s local currency.
Common English terms: Currency Adjustment Factor (CAF).
- Peak Season Surcharge
What is it: A surcharge levied during peak shipping seasons (such as August-October before holidays) due to tight space and demand exceeding supply.
Common English terms: Peak Season Surcharge (PSS). Note: This is temporary, but it occurs almost every year during peak season.
- Port Congestion Surcharge
What is it: A fee charged when severe congestion occurs at the port of origin or destination due to various reasons (such as worker strikes, weather, equipment shortages), resulting in excessively long waiting times for vessels.
Common English: Congestion Surcharge (CGS).
Note: This fee may be announced suddenly and take effect quickly; close monitoring of the destination port’s situation is necessary.
- Emergency Cost Recovery Surcharge
What is it: A “one-size-fits-all” surcharge name used when carriers need to quickly recover from an unexpected surge in costs (such as a sudden increase in canal tolls).
Common English: Emergency Cost Recovery Surcharge (ECRS).
- Terminal Handling Charges
What is it: Charges levied by terminal operators at the port of origin (ORC) or port of destination (THC) for handling, storing, and processing containers.
Common English Terms:
Port of Loading: Origin Receiving Charge (ORC), common in Southeast Asia.
Port of Destination: Terminal Handling Charge (THC), universally charged worldwide.
Note: THC is usually a large component of local charges at the destination port; the specific amount needs to be confirmed with the destination port agent.
III. Common Surcharges “Dictionary” (Air Freight Rates)
- Fuel Surcharge
What is it: Similar to ocean freight, it is levied to cope with fluctuations in aviation fuel prices.
Common English: Fuel Surcharge (FSC).
Note: Usually calculated per kilogram, it is the core of air freight surcharges.
- Security Surcharge
What is it: A fee levied to cover air freight security costs (such as security equipment and personnel).
Common English: Security Surcharge (SSC).
- War Risk Surcharge
What is it: When an aircraft flies over war-torn or high-risk areas, insurance companies will increase premiums; this cost is passed on as a surcharge.
Common English term: War Risk Surcharge (WRS).
IV. How to Effectively Manage and Avoid Surcharges?
While surcharges cannot be completely avoided, the following strategies can help you better predict and control costs:
Ask Clearly and Write Clearly!
When requesting a quote, don’t just ask “How much is the ocean freight?”, but rather ask, “Please provide an all-inclusive price that includes all estimated surcharges or a detailed breakdown of costs.”
Request the freight forwarder to clearly list: Base Freight Rate + BAF + CAF + PSS + ORC/THC, etc.
Choose the Correct Terms of Trade
International trade terms (such as FOB, CIF, EXW, etc.) determine who (buyer or seller) pays which fees.
For example, as the buyer (importer), if you choose FOB terms, you will be responsible for all local charges at the destination port (such as THC, customs clearance fees, delivery fees, etc.), which can be a surprising bill. Be sure to clarify these costs with the freight forwarder in advance.
Plan Ahead, Avoid Peak Seasons
Plan your shipments well in advance to avoid the traditional peak shipping season (August to January of the following year), which can effectively prevent PSS (Pay-Sale Surcharge).
Partner with a Reliable Freight Forwarder
A professional and transparent freight forwarder is your best partner. They can provide accurate cost forecasts, timely risk warnings (such as impending port congestion), and help you choose the optimal route and solution.
Include It in the Contract
When signing a contract with your freight forwarder or carrier, try to include the calculation method or upper limit of certain volatile surcharges (such as BAF) in the contract terms.
Conclusion International freight surcharges are not a “monster,” but a true reflection of the dynamic nature of this complex industry. Viewing them as “hidden” costs often stems from a lack of understanding. This guide aims to help you “decode” your bills, shifting from passive acceptance to proactive management, enabling you to make more informed decisions and make your global supply chain journey smoother and more economical.