Key points
- BAF and LSS pass fuel costs on to you; CAF covers exchange-rate swings.
- THC is charged at both ends: origin THC in China and destination THC in the Gulf.
- PSS and GRI are demand-driven increases, strongest before Chinese New Year and in Q3–Q4.
- War risk and emergency surcharges have been applied to Gulf cargo since the 2026 Hormuz closure.
- Compare quotes all-in: a low base rate with many surcharges can cost more than a higher all-in rate.
Why your sea freight quote has so many lines
Shipping lines price a container in two parts: a base ocean rate, and surcharges for costs they pass through separately, such as fuel, currency, security, seasonal demand and route risk. Local charges at each port come on top, mostly terminal handling and documentation. A forwarder may itemise every line or quote one all-in figure; either is fine if you know what is included and what will be billed later. This guide explains what each surcharge pays for, not amounts, which change weekly. Our team quotes your shipment within one working day with every charge named.
The main surcharges at a glance
| Code | Name | What it covers | How it is usually charged |
|---|---|---|---|
| BAF / FAF | Bunker (fuel) Adjustment Factor | Changes in fuel prices | Per container or W/M, reviewed monthly or quarterly |
| LSS / LSF | Low Sulphur Surcharge | Extra cost of low-sulphur fuel under the IMO 2020 cap | Per container or W/M |
| EBS / EBAF | Emergency Bunker Surcharge | Sudden fuel cost jumps | Per container, added at short notice |
| CAF | Currency Adjustment Factor | Exchange-rate movements | Usually a percentage of freight |
| PSS | Peak Season Surcharge | Peak demand, e.g. before Chinese New Year and in Q3–Q4 | Per container, for a set period |
| GRI | General Rate Increase | Across-the-board increase on a given date | Per container |
| War risk / emergency | War Risk, Emergency Freight, Contingency Surcharge | Extra insurance and costs on high-risk routes such as the Gulf and Red Sea | Per container; higher for reefer, special and DG boxes |
| OTHC / DTHC | Terminal Handling Charge at origin / destination | Lifting and handling at the terminal | Per container, or per W/M in LCL |
| ISPS | Ship and Port Facility Security charge | Port security costs under the ISPS Code | Per container |
| DOC | Documentation fee | B/L issuance and amendments | Per B/L |
| Seal fee | Seal fee | The carrier's bolt seal | Per container |
| AMS / ENS type fees | Advance manifest filing | Cargo data filing required by some destinations | Per B/L |
| Telex release fee | Telex release fee | Releasing the B/L electronically | Per B/L |
| D/O fee | Delivery Order fee | Issuing the release at destination | Per B/L |
| DG / OOG / imbalance | Special cargo and equipment surcharges | Dangerous goods, out-of-gauge cargo, equipment shortages | Per container |
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Fuel and currency: BAF, LSS, EBS and CAF
Fuel is the largest variable cost of a voyage, so lines separate it from the base rate. The Bunker Adjustment Factor (BAF, sometimes FAF) follows fuel prices and is usually reviewed monthly or quarterly. The Low Sulphur Surcharge (LSS) recovers the extra cost of compliant fuel: since 1 January 2020 the IMO has limited sulphur in ship fuel to 0.50% outside emission control areas, down from 3.5%, and to 0.10% inside them. When fuel prices jump suddenly, or when a route becomes much longer, lines may add an Emergency Bunker Surcharge (EBS); in 2026 such surcharges were used heavily on Gulf services. The Currency Adjustment Factor (CAF) protects the line against exchange-rate swings and is often a percentage of the freight.
Port and terminal charges: THC and ISPS
Terminal Handling Charges pay for lifting the container on and off the ship and moving it in the terminal. You will see two: origin THC in China and destination THC in the Gulf. Which side pays depends on the Incoterm. Under FOB the Chinese seller pays origin THC and you pay destination THC; under EXW you pay both; under CIF the seller pays origin THC and the sea freight, but destination THC stays with you unless the seller's freight contract includes it. The ISPS charge recovers port security costs. The International Ship and Port Facility Security Code, in force since 1 July 2004 under SOLAS chapter XI-2, requires ships and port facilities to have security officers and security plans, and many lines and terminals pass part of that cost to cargo.
- Origin THC
- Export documentation and B/L fee
- Seal fee and VGM handling
- Advance manifest fees where required
- Paid by the seller under FOB and CIF, by you under EXW
- Base ocean freight
- BAF, LSS and any emergency bunker surcharge
- CAF, PSS and GRI when applied
- War risk or emergency freight on high-risk routes
- Paid by you under FOB and EXW, by the seller under CIF
- Destination THC
- D/O fee and local documentation
- ISPS charge where applied
- Demurrage, detention and storage if free time is exceeded
- Normally paid by you, even under CIF
Peak season, GRI and war risk in 2026
Peak Season Surcharges appear when demand outruns space, typically before Chinese New Year and in Q3–Q4; General Rate Increases lift all rates on an announced date. Both are announced in advance, so booking early helps. War risk and emergency surcharges reflect insurance and operating costs on dangerous routes. As of November 2026, the Strait of Hormuz has been effectively closed to normal container traffic since 28 February 2026, and the Red Sea remains high-risk. Carriers discharge UAE cargo at Khor Fakkan, Fujairah, Sohar, Salalah or Jeddah and truck or feeder it onward. They charge Emergency Freight per container, higher for reefer, special and DG boxes, plus an extra charge when a vessel actually transits Hormuz and emergency bunker surcharges. One major line added emergency surcharges on contract bookings for the UAE, Bahrain, Qatar, Kuwait and Iraq in September 2026, and reefer, DG and out-of-gauge bookings to many Gulf ports have been suspended.
Documentation and small fees
- DOC fee: issuing the B/L. Amendments after issue usually cost extra, so check the B/L draft carefully.
- Telex release fee: charged when the B/L is released electronically instead of by courier of originals.
- Seal fee: the carrier's high-security bolt seal; record the number on the B/L.
- Advance manifest fees (AMS, ENS and similar): required by some destinations before loading.
- D/O fee: charged at destination for the Delivery Order that releases your container.
- LCL extras: origin and destination CFS fees, often per W/M, for consolidation and unpacking.
Surcharges, CIF value and your duty bill
In the GCC, customs duty is generally 5% of the CIF value: invoice value plus freight and insurance to the first GCC port. Ocean freight and its surcharges are part of that freight, so a large emergency surcharge also raises the base for duty and for import VAT, which is charged on CIF plus duty. If freight and insurance are not shown, customs may add standard amounts. Our broker confirms the customs value for each shipment; try the calculator with your goods value and full freight figure.
Most goods from China pay 5% GCC duty on CIF, once, at the first GCC entry. VAT is on CIF + duty. Estimate only.
How to compare two freight quotes
Before you accept a quote
0/9Quick check: which surcharge is it?
Frequently asked questions
What are ocean freight surcharges?
Extra charges added to the base ocean rate to cover costs that move separately, such as fuel (BAF, LSS), currency (CAF), peak demand (PSS), security (ISPS) and risk on dangerous routes (war risk). Local charges like THC and documentation fees are added at each port.
What is BAF in shipping?
The Bunker Adjustment Factor, a surcharge that follows fuel prices. Lines usually review it monthly or quarterly.
What is the difference between OTHC and DTHC?
OTHC is terminal handling at the origin port, DTHC at the destination port. Under FOB the seller usually pays OTHC and the buyer DTHC.
Why is there a war risk surcharge to Dubai in 2026?
Because the Strait of Hormuz has been effectively closed to container ships since 28 February 2026. As of November 2026 cargo is discharged at ports outside the strait and trucked in, and carriers charge emergency or war risk surcharges for the extra cost and insurance.
Is THC included in CIF?
CIF includes origin charges and sea freight to the destination port. Destination THC is normally for the buyer unless the seller's freight contract includes it.
Are surcharges negotiable?
Some local fees can be negotiated within a contract, but fuel, emergency and security surcharges are usually set by the line for everyone. What you can control is comparing quotes all-in and booking early before PSS or GRI dates.
Sources
- IMO – IMO 2020: cutting sulphur oxide emissions
- IMO – SOLAS XI-2 and the ISPS Code
- Container News – Maersk Middle East operational update amid Hormuz disruptions
- Tradlinx – Maersk's Gulf rerouting changes port of discharge, D&D and empty returns (14 Sep 2026)
- Lloyd's List Intelligence – Strait of Hormuz Brief, 22 October 2026
- UAE ICP – The Concept of the Customs Union (5% duty on CIF)
General information checked on the date shown. Rules and rates change: our team confirms the details for your shipment.