Fuel Adjustment Factor (FAF)

2023-03-01

Customer Advisory

Eastbound from Asia to North America
Fuel Adjustment Factor (FAF)

Dear Valued Customer:

Please note below Westwood Shipping Lines Fuel Adjustment Factor (FAF), effective April 1, 2023, through June 30, 2023.

Effective April 1, 2023, through June 30, 2023, for Containers, service contracts, rate agreements, and tariffs that are effective on January 1, 2020, and later:

U.S. and Canada West Coast Local (See note)
$216/20ST, $266/40ST, $303/40HC

U.S. and Canada West Coast Inland Point Intermodal (IPI) / Mini Land Bridge (MLB) (includes Alaska)
$664/20ST, $714/40ST, $751/40HC

NOTE: U.S. and Canada West Coast local is defined as destinations in California, Oregon, Idaho, Montana, and Washington State. Canada local is defined as Vancouver, BC.

Effective April 1, 2023, through June 30, 2023, for Breakbulk:
$33.00 W/M

Westwood thanks all our customers for your continued business support. If you have any questions or require further assistance, please contact your Westwood Sales Manager.



Understanding Bunker Charge (BC) and Inland Fuel Surcharge (IFS)

What are Bunker Charge (BC) and Inland Fuel Surcharge (IFS) in ocean shipping?

At Westwood Shipping Lines, BC will apply on a quarterly basis, and is based on a 13-week Monday reporting period that ends approximately 30 days before the effective date of the next period as follows:

EFFECTIVE CALCULATION PERIOD
January 1 September – November
April 1 December – February
July 1 March – May
October 1 June – August

The Marine Fuel 0.5% fuel price and Marine Fuel 0.1% fuel price will be derived from rates published independently by Platts Bunkerwire. The calculation uses the average price of Marine Fuel 0.5% and Marine Fuel 0.1% at South Korea and Seattle, or Hong Kong and Los Angeles if unavailable.

Fuel will now be calculated using a formula as follows:

Fuel price:
VLSFO Calculation (IMO):
Current Fuel Price: Marine Fuel 0.5% VLSFO, 13-week Monday simple average using Bunkerwire
Baseline Fuel Price: The 2019 Q4 Marine Fuel 3.5% (IFO380)

LSMGO Calculation (ECA):
Current Fuel Price: Marine Fuel 0.1% LSMGO, 13-week Monday simple average using Bunkerwire
Baseline Fuel Price: The 2019 Q4 Marine Fuel 0.1% LSMGO

FAF value from the formula will not be less than $0

The terms "Fuel Adjustment Factor” (FAF) and "Bunker Adjustment Factor" (BAF) or "Bunker Charge" (BC) are synonymous.

Inland Fuel Surcharge (IFS) is calculated using the diesel fuel update published by the U.S. Energy Information Administration applied to a bracketed table. We evaluate the averages for which IFS value to apply.

How do fuel surcharges apply to my ocean shipping cost?

Both Bunker Charge (BC) and Inland Fuel Surcharge (IFS) will apply separately per number of containers in addition to the base ocean freight rate and all applicable ancillary charges unless otherwise specified within an individual Tariff Line Item (TLI) or Service Contract (S/C).

About Westwood Shipping Lines

Westwood Shipping Lines is owned by Swire Shipping, part of the Swire Group. Westwood operates a fleet of seven vessels in the North Pacific, providing marine transportation between the Pacific Northwest and North Asia. The corporate office is in the South Hill area of Puyallup, Washington.