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What Does Currency Adjustment Factor - CAF Mean? A type of charge applied on top of freight costs by carriers servicing trade between the United States and Pacific Rim countries.

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Old 02-01-2010, 10:35 PM   #17 (permalink)
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What Does Currency Adjustment Factor - CAF Mean?
A type of charge applied on top of freight costs by carriers servicing trade between the United States and Pacific Rim countries. The charge was developed due to costs that carriers incur from constantly changing exchange rates between the U.S. dollar and other foreign currencies.
Investopedia Says
Investopedia explains Currency Adjustment Factor - CAF
The currency adjustment factor rises as the value of the U.S. dollar falls. It is applied as a percentage on top of the base exchange rate, which is calculated as the average exchange rate for the previous three months. Due to this added charge, shippers are now looking to enter into "all inclusive" contracts at one price, that accounts for all applicable charges, to limit the effect of the CAF.

They're just covering themselves in case the USD falls even more Basically it's a rough price.
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