Freight Rate (Ocean Freight)
The cost charged by the shipping line to transport a container between two ports, quoted per TEU (20-foot) or FEU (40-foot), excluding terminal handling and surcharges.
In detail
Ocean freight rate is the base cost component of sea transport, charged by the carrier for moving a container from origin port to destination port. Rates are quoted as: $/TEU (Twenty-foot Equivalent Unit, 20-foot container) or $/FEU (Forty-foot Equivalent Unit, 40-foot container). FEU rates are typically 1.5–1.8× the TEU rate, not 2× — making 40-foot containers more cost-efficient per CBM when full. Rate components beyond base freight: BAF/EBS (Bunker Adjustment Factor — fuel costs, 10–30% of base), CAF (Currency Adjustment Factor), PSS (Peak Season Surcharge, active in pre-Chinese New Year and Q4 e-commerce peak). Historical context: Shanghai–Europe base rates in 2021 reached $14,000/FEU at COVID peak; normalized to $1,500–3,500/FEU by 2024–2026. Rate volatility: freight rates can move 20–50% within a quarter based on capacity and demand. Locking rates at booking provides price certainty; spot rates may be cheaper or more expensive than contract rates.
Examples
- →$2,200/FEU Shanghai → St Petersburg = $1,800 base + $300 BAF + $100 PSS; THC charged separately at $180 origin + $200 destination
Related terms
FCL (Full Container Load)
A shipment occupying an entire ocean container — 20DC, 40DC, or 40HC — booked and sealed by one shipper.
LCL (Less than Container Load)
Consolidated ocean shipping where multiple shippers share one container, each paying per CBM or freight ton of space used.
ETD and ETA
ETD (Estimated Time of Departure) — planned vessel departure date; ETA (Estimated Time of Arrival) — planned arrival date at destination port.
THC (Terminal Handling Charge)
A fee charged by the terminal operator for handling a container at the port — loading/unloading from vessels and moving within the terminal.