由 caicai8478 Dear foreign trade professionals, when you excitedly receive payment from your clients, only to be overwhelmed by a long and complicated shipping bill, you know—it’s those familiar “friends” again: surcharges, arriving uninvited.
These surcharges aren’t unreasonable, but if you don’t understand them, your profits may be quietly eroded. Today, we’ll review five of the most common “frequently occupies” of international freight charges, helping you understand your bills and control costs wisely!
First “Frequently Occurring” Surcharge: Fuel Surcharge – The “King of Floating Costs”
What is it? This is a fee levied to cope with fluctuations in international fuel prices. It’s the largest and most unavoidable surcharge. When fuel prices rise, it rises too, having a decisive impact on freight rates.
Common Charges (English Names):
Sea Freight: BAF (Bunker Adjustment Factor)
Air Freight: FSC (Fuel Surcharge)
Important Note for Foreign Trade Professionals:
This is a global charge, collected by all carriers.
Its rate is adjusted regularly (usually monthly). When quoting a price, be sure to confirm the validity period of the BAF/FEC.
Coping Strategy: When quoting prices to clients, do not rely solely on fixed fuel prices to calculate costs. Always allow for some flexibility or confirm the recent fuel surcharge standards with the freight forwarder.
Second Frequent Charge: Terminal Handling Charges – The “Local Giant”
What is it? This is a charge levied by terminal operators for the loading, unloading, storage, and handling of containers at the ports of origin and destination. While it doesn’t fluctuate as frequently as fuel surcharges, it’s a significant, fixed charge on the bill.
Common Charges (English Names):
Port of Origin: ORC (Origin Receiving Charge), especially common in South China.
Destination Port: THC (Terminal Handling Charge), universally applicable.
Important for Foreign Trade Professionals:
THC is a “truth serum” for trade terms! If you are using FOB terms, the ORC/THC at the port of shipment is borne by you (the seller), while the THC at the port of destination is borne by the overseas buyer. Be sure to specify this in the contract to avoid disputes.
Coping Strategy: When inquiring about prices, proactively ask: “What is your company’s THC/ORC?” Include it in your fixed cost calculations.
The Third Frequent Visitor: Currency Depreciation Surcharge – The “Exchange Rate Assassin”
What is it? It’s a fee charged to compensate for exchange losses when the exchange rate between the settlement currency (mainly the US dollar) and the carrier’s country currency fluctuates significantly. It particularly “favors” certain routes.
Common Substitute (English Name): CAF (Currency Adjustment Factor)
Important for Foreign Trade Professionals:
This surcharge is more common on routes to Europe and South America.
It usually appears as a percentage (e.g., CAF: 12%).
Coping Strategy: If your main markets are these regions, you must consider CAF as a regular cost when quoting prices. Inquire directly with the freight forwarder about the CAF standard for that route.
The Fourth “Regular Visitor”: Peak Season Surcharge – A “Seasonally Limited Guest”
Who is it? This “guest” usually appears on time in the second half of the year (especially from August to January of the following year). Due to a surge in freight demand and tight space, shipping companies or airlines levy fees to regulate the market.
Common Name: PSS (Peak Season Surcharge)
What Foreign Trade Professionals Should Know:
It is temporary but highly regular, appearing almost every year during the peak season.
Besides the traditional peak season, special events (such as canal blockages or pandemic outbreaks) may also suddenly trigger PSS.
Coping Strategy: Plan ahead! Try to advance your shipping plans to avoid peak periods. If avoidance is unavoidable, be sure to proactively inquire during peak season price inquiries: “Is there a PSS currently? What is the amount?” and include it in your costs. The fifth “frequent visitor”: Container-related surcharges – “Time Management Masters”
What are they? This isn’t a single fee, but a “family” of costs, all related to container usage time and turnover efficiency.
Common family members:
Demurrage: At the port of origin, if your container, after loading, is stored at the terminal beyond the free storage period stipulated by the shipping company. (Overtime at the port of origin)
Storage/Demurrage: Incurred concurrently with Demurrage, this is a storage fee charged by the terminal for storage beyond the free storage period.
Detention: If your container, after being unloaded at the port of destination, is not returned to the designated location within the stipulated free storage period. (Overtime at the port of destination)
Important information for foreign trade professionals:
These three are the most likely “unexpected” costs to arise due to factory production delays, customs clearance delays, and customers’ delayed pickup.
Response Strategies:
Clarify Free Time: When booking, clarify with the freight forwarder the number of free container days provided by the shipping company.
Internal Coordination: Maintain close communication with the production and customs teams to ensure timely arrival of goods at the port.
Follow Up with Clients: If it’s FOB terms, urge overseas clients to complete customs clearance and pick up the container promptly.
Cost Control Mindset for Foreign Trade Professionals:
Proactive Inquiry: When inquiring about prices, upgrade from “How much is the ocean freight?” to “Please provide a detailed breakdown of costs, including all estimated surcharges such as BAF, CAF, PSS, and THC.”
Master Trade Terms: A deep understanding of the responsibilities and cost divisions under FOB, CIF, EXW, etc., is the cornerstone of avoiding disputes with clients.
Choose a Reliable Partner: A professional and transparent freight forwarder will proactively warn you about these costs and explain them, making them your best ally in controlling logistics costs.