BAF and CAF: how bunker and currency surcharges inflate your ocean freight bill (2026)

The invisible surcharge that inflates your bill

You receive a quote for an ocean container Shanghai-Los Angeles at $1,650 for a 40' HC. You sign. Three weeks later the final invoice lands at $2,310. What happened? The basic rate was correct, but two lines blew up the total: BAF (Bunker Adjustment Factor) and CAF (Currency Adjustment Factor). On certain routes these two surcharges represent 20 to 35% of the total cost — sometimes more than the basic ocean freight itself.

Worse, those lines are rarely detailed in the quote. They show up under a confusing zoo of acronyms: BAF, BUC, FAF, EBS, MFR, bunker recovery, fuel surcharge, LSS… The goal of this guide is simple: give you the reading grid to know exactly what you pay, compare against public 2026 market indices, and negotiate the three levers that actually move the needle.

Technical definitions: BAF, CAF, and their cousins

BAF (Bunker Adjustment Factor) is a surcharge applied by carriers to offset the volatility of marine fuel (bunker) prices. Since the entry into force of IMO 2020 (1 January 2020), vessels must burn VLSFO (Very Low Sulphur Fuel Oil) capped at 0.5% sulphur, roughly $200/MT pricier than the legacy IFO 380. BAF is therefore indexed to the VLSFO price quoted at Rotterdam, Singapore or Houston, and republished monthly.

CAF (Currency Adjustment Factor) compensates the carrier when the quoting currency (USD) depreciates against the cost currency (euro for European carriers, yen for Japanese, won for Korean). In practice CAF is barely visible on stable EUR-USD corridors today, but remains active on emerging-market trades: North Africa (DZD, MAD), West Africa (XOF), Egypt (EGP), India (INR).

Other surcharges orbit BAF: LSS (Low Sulphur Surcharge, formerly billed separately, today usually folded into BAF), ECA (Emission Control Area, applicable in English Channel, North Sea, Baltic, US Pacific coast), EU ETS (Emissions Trading System, in force since 2024 on European calls), PSS (Peak Season Surcharge, May to October on Asia-Europe), CIC (Container Imbalance Charge), SCS/PCS (Suez/Panama Canal Surcharges).

How BAF is computed in 2026

The generic formula used by most carriers (Maersk, MSC, CMA CGM, Hapag-Lloyd, ONE) follows this logic:

BAF (USD/TEU) = route_consumption (MT/TEU) × (VLSFO_price - reference_price) × route_coefficient

Three variables drive the number:

• Per-TEU consumption on the route: Asia-Europe typically burns 0.70 to 0.90 MT of VLSFO per TEU on a Shanghai-Rotterdam voyage (35-40 days). Trans-Atlantic: 0.30 to 0.40 MT. Mediterranean feeder: 0.20 to 0.25 MT.
• VLSFO reference price: monthly average across the three benchmark ports (Rotterdam, Singapore, Houston) as published by Platts Bunkerwire or specialized indices.
• Route coefficient: ranges from 0.8 to 1.2 depending on whether the route includes a detour (Cape of Good Hope rerouting since 2024 on certain Asia-Europe lanes due to Red Sea risk), a paid canal transit, or feeder calls.

On the Asia - North Europe lane in May 2026, with VLSFO Rotterdam around $580/MT, BAF averages between $320 and $480 per TEU, i.e., $640 to $960 for a standard 40'. On long-haul routes (Asia - West Africa via Cape) BAF can hit $600-800 per TEU.

Where CAF actually applies

CAF has nearly disappeared from major trades (transpacific, Asia-Western Europe, North Atlantic), but stays alive on:

• North Africa (Algeria, Morocco, Tunisia): DZD and MAD are not freely convertible. Carriers bill a 6 to 10% CAF on Mediterranean lanes.
• West Africa (Cote d'Ivoire, Senegal, Cameroon, Nigeria): XOF (CFA zone), XAF, NGN. Typical CAF 8 to 15%, often labeled "WAF surcharge" or "WCA fee".
• Egypt: EGP devalued three times between 2022 and 2025. CAF on East-Med lanes = 8 to 12%.
• India: volatile INR. CAF typically 3 to 6% on basic rate.

On EUR-USD or GBP-USD corridors, CAF today is wrapped into the base rate and no longer appears as a separate line on most spot or annual contracts.

BAF/CAF range table by route (May 2026)

Indicative ranges compiled from monthly carrier publications and Drewry/Xeneta — typically valid +/- 15% depending on the carrier:

Key takeaway: on Asia-West Africa lanes, BAF + CAF combined can exceed the basic freight rate. Mathematically that is the zone where negotiation has the largest impact on the importer's margin.

Three real worked examples (May 2026)

Example 1: 40' HC Shanghai → Los Angeles, spot booking

Example 2: 40' HC Mumbai → New York

Example 3: 40' HC Felixstowe → New York (UK exporter)

Three levers to lower BAF + CAF

1. Demand the full breakdown before signing. A forwarder who refuses to itemize BAF, LSS, THC and CAF is hiding margin in the surcharge column. Insist on an itemized all-in breakdown comparable to what Maersk Spot or MSC eBooking exposes natively.

2. Index BAF on a public formula contractually. Negotiate a clause such as "monthly BAF = max(0, (VLSFO Rotterdam - 350) × 0.8) USD/TEU". This protects you from arbitrary carrier inflation during geopolitical tension.

3. Cap CAF on African and emerging routes. In annual contracts to North Africa or West Africa, push for a CAF cap at 10% maximum. Beyond that, you renegotiate. Carrier competition (CMA CGM, MSC, Maersk, Hapag-Lloyd, ONE, Evergreen, COSCO) on these trades remains live in 2026 — you have leverage.

Bottom line: transparency is worth a margin point

BAF and CAF are not scams — they reflect real underlying costs (fuel, FX). But their opacity is the main weapon of forwarders who help themselves to a markup along the way. The 2026 importer's golden rule: demand itemization, benchmark against public indices, index BAF contractually when volume allows. Those three reflexes typically recover 8 to 15% on annual freight cost — equivalent to one full point of net margin for most importing SMEs.

To go further, see our landed cost guide, our LCL vs FCL comparison, and our China-Senegal freight analysis which dissects exactly how BAF and CAF stack on an Africa corridor.