Currency Adjustment Factor

Summary of Currency Adjustment Factor

A surcharge imposed on ocean freight by a carrier to offset or mitigate the impact of exchange rate fluctuations upon his freight revenue.

(Main Author: William J. Miller)

Currency Adjustment Factor (CAD) in International Trade

Meaning of Currency Adjustment Factor (CAD), according to the Dictionary of International Trade (Global Negotiator): An additional charge added to the base-rate ocean freight costs, which is raised or lowered to reflect changes in the exchange rate of currency in which the freight costs are billed. This charge is separate from the base rate because exchange rates fluctuate more often than freights costs do. Also called Currency adjustment charge (CAC).