What Is Fak

If you’re looking for a better way to manage your shipping costs then FAK rates can help you with that. But, what does FAK or Freight of All Kinds mean in shipping? Find out on this blog as we take you through the meaning, benefits, and latest updates. Plus, find boxes for your freight from trusted suppliers at competitive rates, on Container xChange.

Imagine you have cargo of different freight classes (value, weight, density, etc.) to ship in a single container at a single rate, how great would that be right? Well, FAK rate is that single rate you pay for the different goods you want to ship. Using Freight of All Kinds rates you can save a lot of money. As you don’t have to pay a larger sum for higher freight-class goods which otherwise would be an expensive endeavor.

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Just like the scenario above, if you do have goods with varying freight classes (high and low) to send out and need a box from trusted suppliers, the best solution is to find a platform where you can get all these features in one place. And Container xChange can do that for you. With us, you get 50,000+ containers across 2,500 locations worldwide at the price you want to pay from 1,500+ vetted suppliers.

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What do Freight of All Kinds (FAK rates) mean in shipping?

Freight of All Kinds (FAK rates) in shipping refers to a class agreement that is established between a carrier and a shipper, allowing the shipper to move multiple products of different classes at one standardized freight class. By doing this, the shipment is assigned using a single tariff, as it now falls under freight consolidated cargo. This single tariff is the FAK rate and it’s determined by the carriers.

Let’s break this down further. In LTL (Less Than Truckload) Freight, every product has a specific “classification” or “class” related to it. The National Motor Freight Traffic Association (NMFTA) is responsible for recognizing and classifying every commodity with one of 18 values ranging from 50-500. As the class increases, the cost to ship higher-class freight increases too. The idea behind FAK is to choose one class that averages the items being shipped so that the cost is fair for both the shipper and carrier.

FAK rate is negotiated between the shipper, NVOCC, or freight forwarder and the carrier. It’s an agreement that states that the carrier will assemble numerous different freight classes into a single class and transport them at a single freight shipping rate. This intends to:

• Reduce the amount paid on higher-class shipments.
• Streamline the shipping process by decreasing the requirement for re-classifying goods.
• Average the details of several cargos to come up with a fairer shipping rate for you (as the shipper, NVOCC, or freight forwarder) and the carrier.

With advantages galore on FAK rates, the next essential thing for you to do is to find a box at the best price. And xChange can help you with that by connecting you with certified suppliers for your shipment consisting of goods of varying freight classes.

What determines FAK rates?

Several factors determine FAK rates:

• Container loading- For Full Container Loads (FCL) the rates are based on the size and type of unit. For Less than Container Loads (LCLWhat is less than container load? Less than container load (less than container load, LCL) is a shipping term that refers to the delivery of cargo in smaller quantities than a full container load. A f… More) the price depends on weight and volume – whichever is greater.
• Full Truckload (FTL or TL)- This applies to an entire van or trailer and the rate goes by distance in miles.
• Less Than Truckload (LTL). Depending on the density, the commodities are given a Freight Class and a National Motor Freight Classification (NMFC) code. These determine the base price carriers may charge you.
• Weight- The more a shipment weighs, the less you pay per hundred pounds.
• Density- This is determined by taking the total weight and dividing it by the total cubic feet of the item. Density is also used to calculate the class of the shipment.
• Distance- Longer the distance, the more FAK rate you’ll pay. You pay higher prices per hundred pound-weight.
• Base Rates. LTL carriers use their base rates per 100 pounds which may vary between carriers and are based on the classification of the freight.
• Minimums- Absolute minimum charge (AMC) helps LTL carriers protect themselves against higher carrying costs for smaller shipments.

How to know if your shipment qualifies for FAK classification?

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Individual carriers determine different FAK classification rates. Hence, the best way to know a shipment’s qualification for FAK classification is to ask the carrier.

But before talking to the carrier about FAK rates and whether your shipment qualifies for FAK classification, do check out the following:

• Look at the carrier’s restricted cargo list. You can usually find this on their website and see if any of your goods are on the list of prohibited commodities.
• Get a Freight Class Estimate – Numerous websites give you an estimation of the LTL freight class of your goods. Hence, use these websites to determine if the items you want to ship fall under a close range of weight and density.
• If you’re a shipper, work with a freight forwarder – Most carriers won’t offer FAK rate to one-time or sporadic customers. If your shipping needs are regular, you’re more likely to benefit from working with a freight forwarder as they provide carriers with regular business.
• Develop good packaging habits. Palletizing products in a pallet-wide container, merging merchandise that falls within a parallel range. And providing information on exact items and quantities are good practices to follow to get your freight FAK classified.

The singular rates provided to FAK shipments are more valuable to a shipper than to a carrier because of their money-saving benefit. Hence, carriers that do provide FAK rates, especially for LTL are only going to do so if they can count on you for multiple shipments.

If you think you have goods that might qualify for FAK qualifications then get your box from our neutral, secure, and transparent marketplace.

Benefits of Freight of All Kinds Classification

As you can tell already Freight of All Kinds has a lot of benefits to ease your logistics operations, let’s explore these benefits in detail below:

• Money saver- You already know that higher classes of freight cost more to ship through less than truckload shipping. With FAK rates only one class is averaged for items (both high and low classes of goods) so the cost is reduced and fair and helps your business save money.
• Lower freight classification negotiations- Along with lower rates you can also negotiate to pay a mean range, i.e., you can reduce how much you pay for less dense but more expensive products.
• Faster rate quotes- Small changes to frequent FAK orders can be handled more quickly and prevent delays in shipping.

Note: Shippers that benefit the most from FAK classification are those who ship a variety of commodities with high frequency.

Reap the benefits of FAK rates by sending out your goods in boxes of your choice at competitive, comparable, and negotiable rates you can find only on our platform.

Difference between FAK freight class and class exceptions

There are often times confusion between the terms FAK freight class and class exceptions. To clear all your doubts here’s the difference between the two terms:

FAK classification Class exception Cargo is shipped for a flat rate negotiated and agreed between the carrier and the shipper with no adjustments in terms of the density ranges. Carriers levy their own rule for pricing freight of different classes.

When not to consider Freight of All Kinds classification

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Despite all the benefits of FAK rates, Freight of All Kinds may not be the right approach for you in certain instances such as:

• You only have a single shipment to send out. Carriers are only going to provide FAK rates if they can rely on you for several shipments.
• When your shipment already falls under lower-class freight.
• Shipping items of high value. When trying to file damage claims, carriers will often only be responsible for the freight class you pay for. This means your high-priced items will only achieve the protection of the averaged FAK classification.
• You use a Transportation Management System or TSM. This eradicates the need for FAKs because dynamically rating shipments of numerous classes can be done effortlessly.

Get boxes at top rates from trusted suppliers on Container xChange

On Container xChange’s marketplace, you can find units at competitive and comparable rates upfront on one dashboard. You can negotiate these rates with your container supplier to choose a deal that works best for you. You get all this without the worry of hidden fees too.

Apart from the competitive rates you see on our platform. You also get the benefit of only working with trustworthy suppliers as all members go through a mandatory vetting process to ensure your safety. You can also view the profiles of companies and see the ratings and reviews given to them by their partners and decide whom you want to work with.

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Get the latest updates on FAK rates and other freight rates on xChange’s market report

Along with all the general information on FAK rates. It’s also important for you to update yourself on the latest news that revolves around these rates in the industry. And our monthly logistics report is here to give you the latest stats on Freight of All Kinds around the world currently:

• Major container lines on the India-Europe trade lane are going to announce “steep” rate hikes, from August.
• CMA CGM’s freight-all-kinds (FAK) rates for cargo moving out of India to North Europe. And the Mediterranean would be respectively US $1,000 per TEU and US $1,200 per FEU.
• Hapag-Lloyd will charge a base rate of US $805/TEU for dry shipments from Nhava Sheva/Mundra starting at US $280.
• The base rate for high cube containers at present is US $110 but will rise up to US $810 TEU. MSC’s FAK rates from Nhava Sheva to Antwerp/Valencia are expected to be US $700 per TEU. And US $750 per FEU from August.
• Maersk has announced FAK rate increase from Pakistan, the Middle East, and the Indian subcontinent to North America, namely the United States and Canada.
• This FAK rate increase will be effective from 1 September 2023 and will be applicable to all container types.
• CMA CGM will apply new Freight All Kinds (FAK) rates from Middle East Gulf ports to all North European, West Mediterranean, and North African ports from 21 August until further notice.

For more insights like these, be sure to download your free copy of our report, Where Are All the Containers?

Lease units from trusted suppliers with ease on Container xChange

Now that you know all there is to know about FAK rates. Don’t waste another minute and utilize its benefits for your higher freight class shipments. Get your cargo containers on xChange in just a few steps:

• Log on to www.containerxchange.com
• Type in your location and the container type you require
• Hit the search button and browse through all the offers
• Interact and negotiate deals with vetted members and suppliers
• Say yes to a rate that suits your budget and close your deal!
• Track your shipment in near-real time with our tracking feature and receive a monthly invoice via your xChange Wallet.

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FAK rates: Common FAQs

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