Bunker Adjustment Factor (BAF)

What is Bunker Adjustment Factor?

Bunker Adjustment Factor is a surcharge levied on the shipping companies to compensate for the fluctuation in the price of ship’s fuel. The charges are set quarterly by the Transpacific Stabilisation Agreement (TSA), and priced using the Brent crude oil benchmark.

The charges are levied to regain the potential loss due to an increase in the price of diesel/fuel during the shipment of goods.