Bunker Adjustment Factor (BAF)

The Bunker Adjustment Factor (BAF) is a surcharge added to shipping costs to cover fluctuations in fuel prices used by ships. Since fuel prices can change frequently, shipping companies adjust their rates periodically to account for these costs, ensuring they can operate efficiently without suffering financial losses. Essentially, BAF helps allocate the variable costs of fuel to customers, keeping shipping prices more stable over time and reflecting the actual expenses of running the vessels.