Definition
A surcharge that adjusts freight for exchange-rate fluctuations between the billing and base currencies.
The Currency Adjustment Factor protects carriers against losses when freight is collected in a currency that moves against the carrier’s base currency, usually the US dollar. It is expressed as a percentage applied to the freight and revised as exchange rates shift.
CAF is the currency counterpart to the fuel-driven BAF. On stable lanes it may be small or folded into the base rate, but on volatile currency pairs it can be a meaningful line item that forwarders flag to customers.
Related terms
Bunker Adjustment Factor (BAF)
A surcharge that adjusts ocean freight for fluctuations in the price of marine fuel (bunker).
Terminal Handling Charge (THC)
A fee charged by the port terminal for handling a container between the vessel and the yard.
General Rate Increase (GRI)
A carrier-announced increase to base ocean freight rates on a trade lane, effective from a set date.
Ocean Freight
The transport of goods by sea, the dominant mode for high-volume international trade.
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