You get a freight quote that looks reasonable. Then the invoice arrives with six additional line items you did not budget for, and the total is 40% higher than the base rate. Welcome to the world of freight surcharges.
Surcharges are not hidden fees in the shady sense — they are real costs that carriers pass through to shippers. But the names are opaque, the amounts vary by carrier and lane, and some are more negotiable than others. This breakdown explains the ones you will most commonly see on China-origin freight.
BAF — Bunker Adjustment Factor
BAF is the fuel surcharge. Ocean carriers burn enormous amounts of bunker fuel, and fuel prices fluctuate. Rather than repricing their base rates every week, they float a separate fuel component that adjusts monthly or quarterly.
BAF is typically quoted per TEU (twenty-foot equivalent unit) and varies by trade lane. Transpacific BAF tends to be different from Asia-Europe BAF because the voyages are different lengths.
Is BAF negotiable? Not much at the standard level, but larger shippers with volume contracts sometimes negotiate a BAF cap or a fixed rate for a defined period. If you are spot-buying, you largely pay the going rate.
CAF — Currency Adjustment Factor
CAF exists because carriers price in US dollars but operate in multiple currencies. When the dollar weakens significantly against the currencies they spend in (local port costs, crew wages, maintenance), CAF compensates.
CAF is usually expressed as a percentage of the ocean freight base rate. It often runs between 0% and 15% depending on the lane and the period.
Is CAF negotiable? Sometimes. On long-term contract rates, some shippers negotiate a corridor — for example, CAF only applies if USD/EUR moves more than 5% from a reference rate.
EBS — Emergency Bunker Surcharge
EBS is a supplemental fuel charge, separate from BAF, that carriers add when oil prices spike sharply and their BAF mechanism does not adjust fast enough to cover costs. You are most likely to see EBS on Asia-Europe lanes.
Like BAF, EBS is largely non-negotiable on spot shipments.
LSS — Low Sulphur Surcharge (or LSFO Surcharge)
Since IMO 2020 regulations came into force, vessels must use low-sulphur fuel (or fit scrubbers), which is more expensive than standard bunker fuel. LSS was introduced by many carriers to cover this additional cost. Some carriers have since folded LSS into their BAF calculation; others still list it separately.
PSS — Peak Season Surcharge
PSS is added during high-demand periods — typically the run-up to Golden Week in China (October), and the pre-Christmas peak in Q3. Carriers apply PSS when capacity is tight and demand exceeds supply. It usually runs $200–$600 per TEU depending on the lane.
PSS is not permanent; it disappears when peak season ends. Shipping slightly outside the peak window can mean the difference between paying PSS and not.
GRI — General Rate Increase
GRI is an announced base rate increase, not strictly a surcharge, but it shows up as a separate line in some rate structures. Carriers typically announce GRI with a few weeks' notice. If you have a contract rate that predates the GRI, your contract terms govern whether it applies.
THC — Terminal Handling Charge
THC covers the cost of moving your container within the terminal — from the vessel to the stack, and from the stack to the gate. THC is charged at both origin and destination. It is not part of the ocean freight itself but is listed separately on nearly every invoice.
THC is set by the terminal, not the carrier, which means it is less flexible. On the China side, major port THC is relatively standardized. At destination, it varies significantly.
For more on THC and the other costs that show up after you arrive, see our hidden import costs checklist.
ENS / AMS / AFR — Security Filing Fees
These cover advance manifest filing requirements. AMS (Automated Manifest System) is the US requirement. ENS (Entry Summary Notification) covers EU. AFR (Advance Filing Rules) is Japan. These are administrative fees, usually $25–$75, and are typically non-negotiable since they recover a direct government compliance cost.
B/L Fee — Bill of Lading Issuance
Carriers charge for issuing the bill of lading, typically $50–$150. Some forwarders include this in their fee; others pass it through. Worth checking so you are not paying it twice.
Which Surcharges Are Negotiable?
Generally speaking:
- Low negotiation leverage: BAF, EBS, LSS, THC, filing fees — these track real costs the carrier does not control.
- Some negotiation leverage: PSS (timing your shipment to avoid peak windows), GRI (if you have a contract), CAF (with corridors on long-term deals).
- Most negotiable: Base ocean freight. This is where competitive quotes actually matter.
The best way to know if you are paying fair rates — surcharges and all — is to get multiple quotes on the same lane and compare the all-in number, not just the base rate. Our freight rate tool gives you a transparent breakdown so you can see exactly where the cost sits.
If you are trying to reduce overall freight spend, how to cut freight costs from China covers the practical levers.