Ocean freight pricing often appears confusing to shippers, with numerous surcharges added to base rates. This article examines five common surcharges - ORC, LLA, HLA, GRI and EBS - clarifying their definitions, applications and calculation methods to help businesses better manage shipping costs.
1. ORC (Original Receiving Charge): Southern China's Unique Fee
The ORC is a regional fee specific to Southern China (primarily Guangdong) ports for exports to transoceanic routes including North America, Central/South America, Europe and North Africa. Importantly, ORC and THC (Terminal Handling Charge) are mutually exclusive - only one applies per shipment.
For exports from Southern China to Southeast Asia, only THC applies. ORC rates typically stand at $141 for 20GP containers and $269 for 40' containers, while THC averages ¥750 ($105) for 20' and ¥1,200 ($170) for 40' containers, varying by carrier.
2. LLA (Long Length Additional): The Overlength Penalty
LLA applies when single items exceed standard length limits (typically 9m for general cargo, 6m for containers), requiring special handling equipment and stowage arrangements. Charges increase progressively with length, making advance consultation with carriers essential for oversized shipments.
3. HLA (Heavy-Lift Additional): The Weight Premium
Similar to LLA, HLA addresses heavy single items (typically 2-5+ tons depending on carrier) needing specialized equipment like heavy cranes and additional labor for securing. Fees escalate with weight and multiply for transshipments, significantly impacting costs for heavy machinery or industrial equipment.
4. GRI (General Rate Increase): South America/US Rate Adjustments
Primarily affecting South American and U.S. routes, GRIs compensate carriers for rising operational costs from port conditions, vessel requirements, or cargo characteristics. Their opaque calculation methods make advance communication with carriers crucial for accurate budgeting.
5. Fuel Surcharges (FAF/IFA/EBS/EBA): The Oil Price Barometer
These volatile fees adjust shipping costs to reflect bunker fuel price fluctuations. Common variants include:
- FAF (Fuel Adjustment Factor): Common on Japan routes
- IFA (Interim Fuel Additional): Often long-term despite "temporary" labeling
- EBS/EBA (Emergency Bunker Surcharge/Additional): Australia/NZ and Africa/Latin America routes respectively
Typically calculated as percentage adjustments or per-tonnage fees, these surcharges require close monitoring of oil markets and carrier announcements.
Mastering Surcharges for Cost Control
Understanding these five key surcharges enables shippers to better interpret freight invoices and optimize logistics budgets. Proactive communication with carriers about current rates and policies remains essential for accurate cost forecasting in the dynamic shipping market.