what is shipping rate and how to calculate it?

09 Aug what is shipping rate and how to calculate it?

Shipping rates calculator

while Shipping from china to other places, Cargo ship rates are normally provided in the form of a freight quotation, and the format of these quotations can vary from freight forwarder to freight forwarder and shipping company to shipping company.

Whilst new surcharges seem to be introduced daily, as a top China freight agent in china, your freight price will most likely be made up of the below tariff rates & surcharge items. Here’s a rundown below.

Ocean tariff rates and surcharges

1. BAS – Basis ocean freight

The term is pretty self explanatory. It’s the base rate for ocean freight.

2. BAF – Bunker Adjustment Factor

2.1 Associated with vessel fuel cost.
2.2 Charged per size unit. I.e. 20′ cntr = $350 40′ cntr = $700
2.3 Different carrier and different route with different standards.

3. CAF – Currency Adjustment Factor

Associated with fluctuations in exchange rates.

4. HWG – Heavy Weight Surcharge

For exceeding certain weight. 20ft containers exceeding the weight of 14,000 kg (or 18,000 kg, or 22,000 kg). This concerns 20ft only.

5. EBS – Emergency Bunker Surcharge or EBA – Emergency Bunker Adjustment

Associated with extraordinary vessel fuel cost.

6. FAF – Fuel Adjustment Factor

Almost same as BAF, applied to Japan, the Persian Gulf, the Red Sea, and South America.

7. GRI – General Rate Increase

8. PCS – Port Congestion Charge

Associated with losses caused by congestion and idle time for vessels serving that port.

9. PSS – Peak Season Surcharge

Associated with incremental operational costs incurred during the peak season.

10. WRS – War Risk Surcharge

11. YAS – Yen Applica Surcharge

Only associated to Japan Line.

12.SCS/SCF/PTF/PCC

There may be additional charges depending on where you are shipping to, but the above are the core freight cost components when shipping from China.

Different route means different calculation method. Please find the tables below, also please note it’s for reference only (subject to change).

Additional terms and fees

THC – Terminal Handling Charge

OTHC, Origin Terminal Handling Charge
DTHC, Destination Terminal Handling Charge

Charged by the carrier for the handling of containers at the container terminal before being loaded onboard a vessel, including the unloading of the container from a truck, stacking and transport from the stacking location to just below the crane near the shore.

Docs Fee – B/L Fee

Admin charge for required shipping documentation. May apply for a bill of lading or container.

Demurrage and Detention

Period of container can be divided into Demurrage and Detention. Normally 7 days free for both of them.

Then Demurrage penalties imposed for excess use of container from its unloading at the terminal until the time of export from the terminal. Detention penalties imposed for excess usage container since its removal from the terminal until the return of empty containers at the port.

Storage

It is calculated from the moment of unloading at the terminal until the time of export from the terminal and is increasing the scale. Commonly 5-7 days for free of charge, longer the carrier is in port, the more expensive each day of storage.

Inspection

This rate for work on putting the container on the ground clearance (Customs, health, etc.).

Destination charges

The above guide has been written from the point of view of exporting from China and under the CFR incoterm.

This means that consignments are usually shipped from Port to Port and charges not included in the prepaid freight amounts will be for the account of the buyer/consignee i.e. destination THC, destination documentation, destination customs clearance and any delivery to the consignees door.

A quick taking away

Shipping rates calculation is complicated, especially there are special rules applied to different routes. That’s why China shipping agent provide all in rates, meaning that the cost of transportation includes all the additional fees and surcharges provided for under the conditions of carriage.

You may find tools online for calculating such cost. But as far as we know, the results are not so accurate. So if you are looking for a freight quote for your cargo from China, don’t hesitate to visit our quote formand submit your request. It’s free, quick, and accurate.