Bunker Adjustment Factor - Explained
What is a BAF?
Written by J. Mance Gordon
Updated at April 21st, 2024
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What is a Bunker Adjustment Factor (BAF)?
The Bunker Adjustment Factor (BAF) refers to a high-cost expense, payment, or surcharge to individuals shipping on ocean vessels. This is an additional charge to the base rate of ocean freight that reflects the costs of fuel - otherwise known as bunker oil.
Bunker oil is the most critical cost of shipping on ocean vessels. In some cases, carriers incur more bunker cost than that base freight rate. The increased costs resulting from fluctuation of the price of bunker fuel for vessels gave rise to the development of Bunker Adjustment Factor.