Currency Adjustment Factor (CAF)

In times of unstable currency, the freight rate is often quoted with a currency adjustment factor (CAF) to cover an additional charge for currency appreciation. The CAF, if any, is indicated on the bill of lading. The tariff of most international carriers uses the U.S. dollar as the basis of the freight cost calculation. The CAF allows for fluctuations in the value of the dollar against the currency in which the carrier earns its revenues.