Terminal Handling Charges (THCs) are the collection of fees related to the services provided by terminal operators. Learn everything about THC charges in this guide now.
What are terminal handling charges?
THC in shipping refers to the fees imposed by terminal operators for handling cargo at ports, terminals, or container freight stations (CFS). It is the same as Container Service Charges and only applies to ocean freight.
Generally, Terminal Handling Charges should be borne by either the shipper or the buyer, depending on the specific terms negotiated under Incoterms.
Terminals commonly charge these fees to cover maintenance and security expenses within the terminal premises. Meanwhile, they also support the settlement of surcharges and employee compensation.
What do THC charges include?
The final Terminal Handling Charges vary based on the terminal operator and location, but here are the basic fees that will be covered:
Handling: This involves unloading cargo containers from ships and moving them to the yard and vice versa, using equipment like cranes and forklifts.
Documentation: Some terminal operators may encompass the preparation and processing of documentation associated with container movements in THC charges.
Storage: THCs also include storage fees for containers held at the terminal, especially if the cargo remains at the port for an extended period before loading onto or after discharge from a vessel.
It’s crucial to review the fee structure meticulously to grasp the services included. By collaborating with Airsupply, you gain access to THC full form in shipping and transparent pricing quotes, mitigating the risk of unexpected hidden costs.
What are the types of THC charges? Who pays them?
Terminal Handling Charges are inevitable costs incurred in every shipment at the origin, destination, and transshipment ports, regardless of who pays it.
Origin THCs (OTHC) are typically settled for port services before a vessel departs from the origin port. Conversely, Destination Terminal Handling Charges (DTCH) are collected upon arrival at the port.
As mentioned above, payment responsibility for THC charges varies depending on the shipping terms. For example, under EXW terms, the buyer is shouldered for paying the THC, while in FOB shipping, the shipper generally covers these fees.
Additionally, the freight carrier pays any THC charge at a transshipment port, as this is factored into the overall freight cost.
You also should note that certain types of cargo and equipment may attract extra Terminal Handling Charges:
For instance, Out-of-gauge (OOG) cargo, which is oversized, usually requires specialized slings and extension spreaders for handling.
Handling hazardous materials entails a designated area within the container yard for safe storage and sequestering.
Moreover, handling reefer cargo at the port involves connecting the containers to an electricity source to maintain the required temperature.
How can you calculate Terminal Handling Charges?
THC in shipping is determined based on cargo type, dimensions, weight, and container specifications.
There are several methods to calculate THC, with the most common ones relying on cargo volume (CBM) or container size.
Suppose that you’re shipping from China to the UK:
For FCL container shipping:
- A 20ft GP container incurs THC costs ranging from $125 to $140 per container.
- A 40ft container carries a THC charge of $185 per container.
For LCL shipping:
THC fees are calculated at $8.5 per CBM. For instance, if your shipment’s volumetric weight is 4 CBM, the THC would amount to 4 x $8.5 = $34.
Terminal Handling Charges, fixed by terminal ports, undergo annual adjustments and vary among sea lines. Additionally, in some ports, THC rates may fluctuate based on the volume of shipped goods.
At Airsupply, we guarantee that you get the breakdown of costs associated with cargo handling at different terminals. With our efficient cargo handling and optimized work-flows, you can receive your shipments at a competitive rate and faster shipping time.
What is the difference between Wharfage and THC?
Wharfage concerns the use of wharf or dock facilities for cargo loading and unloading on the Terminal Provider’s property. It is typically billed as a separate fee.
In contrast, THC charges cover a broader array of services associated with cargo handling within the terminal facility. These are pass-through fees, non-negotiable, and may differ between terminals.
