BAF – Bunker Adjustment Factor
BAF stands for Bunker Adjustment Factor and is a surcharge used in shipping to compensate for fluctuations in fuel prices. Also known as Fuel Adjustment Factor.
Why BAF Used?
In maritime transportation, ship fuel is an important cost item. Fuel prices may change due to fluctuations in crude oil prices and other factors. BAF helps carriers offset cost increases resulting from these fluctuations.
How to Calculate BAF?
BAF is calculated based on two key factors:
Fuel Price: The average fuel price in major bunker ports in the world is used.
Trade Factor: A coefficient that includes factors such as distance, weight of the load, fuel efficiency, transportation time and route.