The Bunker Adjustment Factor (BAF), also known as the Fuel Adjustment Factor, is an additional charge levied to account for fuel price fluctuations in shipping. It is based on the cost of Brent crude oil, an international benchmark, and is calculated by multiplying the fuel price by a trade factor. The trade factor takes into account factors such as cargo weight, container size, vessel type, fuel efficiency, route, vessel direction, distance and transit time. Previously set by the Transpacific Stabilisation Agreement (TSA), BAF rates are now set independently by shipping lines to prevent collusion, with the European Commission monitoring fair practices. The BAF helps to reflect fuel costs, adapt to changing prices and maintain transparency in the shipping industry.

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