Ocean freight rates are not one number. What a forwarder calls “the rate” is usually the sea leg alone, and the invoice that lands later carries eight or ten more lines that were always going to be charged. This guide walks through every line you should expect on a sea freight quote, explains who levies it and why, and sets out what makes the underlying rate move from one month to the next. No figures are quoted here, because they change weekly; what does not change is the structure.
The anatomy of a sea freight quote
A complete quote for an FCL export from Mundra, Pipavav or Nhava Sheva should show these components separately. If yours does not, ask for it broken out before you compare it with anyone else’s.
| Line | Levied by | What it covers |
|---|---|---|
| Ocean freight (basic) | Carrier | Port-to-port carriage of the container |
| BAF / FAF / bunker surcharge | Carrier | Fuel cost, adjusted periodically |
| CAF | Carrier | Currency movement against the tariff currency |
| THC origin | Terminal, billed via carrier | Lifting and moving the box inside the load port |
| THC destination | Terminal at discharge port | The same work at the far end |
| Documentation / BL fee | Carrier or forwarder | Issuing the bill of lading and filings |
| Seal | Carrier | The bolt seal on the container door |
| CFS / handling | CFS operator | Stuffing, destuffing, storage, examination handling |
| Inland haulage | Trucker or railway | Factory or ICD to port and back |
| Detention and demurrage | Carrier and terminal | Time beyond free days, charged if incurred |
Ocean freight, the basic line
This is the carrier’s charge for moving a container from load port to discharge port. It is quoted per container for FCL and per revenue tonne for LCL, where the carrier bills on whichever is greater: one cubic metre or one tonne. That “whichever is greater” rule is why light, bulky cargo like ceramic sanitaryware or packaged textiles is often cheaper in a full container than as LCL. If you are unsure which side of that line your cargo falls, work the volume out first with a CBM calculator.
BAF, CAF and the surcharge family
Bunker adjustment factor, sometimes shown as FAF or BUC, passes fuel price movement through to the shipper. It is recalculated on a set cycle rather than continuously, which is why a fuel spike shows up in your invoice a quarter later. Currency adjustment factor covers movement between the currency the carrier’s costs are in and the currency the rate is quoted in.
Around those two sit a long tail of situational surcharges: peak season surcharge when demand outruns space, congestion surcharge when a port is backed up, war risk or security surcharges on affected routings, low sulphur fuel surcharges tied to emissions rules, and equipment imbalance surcharges when empty containers have to be repositioned. Ask which of these are fixed for the validity of your quote and which the carrier may introduce mid-booking.
Terminal handling charges at both ends
THC is the terminal’s charge for moving your container within the port: off the truck or rail wagon, through the yard, onto the vessel. It is charged at origin and again at destination, and the split depends entirely on your Incoterm. Under FOB the seller pays origin THC and the buyer pays destination THC; under CIF and CFR the seller pays the sea freight but destination THC usually still lands on the buyer. A quote that shows a low freight figure and stays silent on destination THC is not a cheaper quote, it is an incomplete one.
Documentation, seal and the small administrative lines
The bill of lading fee covers issuing the transport document and the associated filings. Depending on destination there may also be an advance manifest or security filing fee, which is a regulatory requirement of the importing country rather than a carrier invention. The seal charge covers the numbered bolt seal fixed to the container door after stuffing; the seal number appears on the BL and is the basic evidence that the box was not opened in transit.
CFS and handling charges
If the cargo goes through a container freight station, the CFS charges for receiving it, storing it, stuffing or destuffing it, and presenting it for customs examination. For LCL this is unavoidable. For FCL stuffed at the factory it may not apply at all, which is one reason factory stuffing is often cheaper overall even though it adds coordination work. Where consolidation is involved, the split between CFS handling and warehouse handling should be clear on the quote.
Detention and demurrage
These are the two charges that turn a good rate into a bad one. Demurrage is the terminal’s charge for a container sitting inside the port beyond its free days. Detention is the carrier’s charge for keeping their container outside the port beyond its free days, typically while you unstuff at your premises. They accrue daily, often on a rising scale, and they are the most common cause of a final invoice exceeding the quote.
The quote should state how many free days you get at each end. Negotiate free time at booking, not after the container is stuck. Most detention bills trace back to something predictable: a document that arrived late, a clearance query, or a warehouse that could not receive the container the day it landed.
What makes ocean freight rates move
Ocean freight rates are a spot market with contract overlays. Four forces do most of the work.
- Capacity. Supply is the number of ships and slots deployed on a trade. New vessel deliveries push rates down over time; scrapping, dry-docking and vessels being diverted onto longer routings pull capacity out and push rates up.
- Demand and season. Rates on India-outbound trades typically firm ahead of major buying seasons and around Chinese New Year, when factories across Asia rush shipments before shutting. Expect pressure on both space and price in those windows.
- Blank sailings. When demand softens, carriers cancel scheduled departures to hold rates up. For a shipper this is a schedule risk as much as a price one: a blanked sailing can push your cargo a week or more, so build buffer into promised delivery dates.
- Fuel and regulation. Bunker prices feed through BAF on a lag. Emissions rules and routing changes that lengthen a voyage raise fuel burn per box and eventually show up in the rate.
Port-level factors add on top: congestion at a transhipment hub, equipment shortages at a particular inland container depot, or a labour issue at the discharge port. None of these are visible in a single quoted number, which is why a rate valid for two weeks and a rate valid for a quarter are not the same product.
Reading a quote properly
- Check the validity date and whether surcharges are frozen for that period.
- Check the Incoterm and confirm which THC sits with which party.
- Check free days for detention and demurrage at both ends, in writing.
- Check whether inland haulage, CFS handling and customs work are included or quoted separately.
- Check the routing: direct or transhipment, and through which hub. A cheaper transhipment routing can cost more in delay.
- Check what is excluded. Marine insurance, fumigation, certificates of origin and examination charges are commonly outside the freight quote.
Once a quote is itemised this way you can compare it honestly against another, and you can predict the invoice. Our ocean freight service page sets out how we structure quotes, and the glossary covers the abbreviations above if a carrier uses a different label for the same charge. For a worked example on a live lane, see sea freight from China to India.
Talk to Scapex
Send us a quote you have received and we will read it line by line with you, or tell us your lane and cargo and we will price it in the itemised format above. Contact Scapex Global Forwarding and we will take it from there.