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Terminal Handling Charges (THC)

Paying Terminal Handling Charges (THCs) is an essential part of the shipping process, and can’t be ignored.

What are Terminal Handling Charges?

Terminal Handling Charges or THC are fees charged by the shipping terminals for the storage and positioning of containers before they are loaded on a vessel. These services include equipment handling, container positioning, maintenance, storage and the discharging of equipment.

There are many factors that impact the price of these charges at different ports, starting from the port of origin all the way through to the destination port.

The local charges of a terminal directly affect the THCs, so the cost varies from port to port within each country.

Unfortunately, THCs are some of the container fees you just can’t get around. Let’s learn more about what all THCs include in the next section.

What does the terminal handling fee include?

THCs cover the cost of a variety of services provided by the terminal operator, such as:

Terminal Handling Charges (THC)

Handling of containers: This includes the moving of containers from the vessel to the yard and vice versa, including the use of equipment like cranes and forklifts.

Storage: The THCs also include storage for containers at the terminal for a particular time frame.

Documentation: Fees may cover the preparation and processing of documentation related to the movement of containers.

Security: Terminals often charge for maintenance and security at the terminal, including the use of security personnel and equipment.

Maintenance: Maintaining terminal infrastructure and equipment is expensive, so this is often included in the final THCs as well.

What’s included in the final shipping cost?

The way a carrier charges Terminal Handling fees also depends on the route of shipping. Usually, the total container shipping cost includes the following surcharges:

Local charges at the origin port
OTHC
Sea/ocean freight charges
DTHC
Local charges at the destination port

How does THC surcharge in importing and exporting activities take place in Vietnam?

Starting from mid-2007, shipping lines have begun to collect THC fees in import and export activities. THC fee collection is officially applied to shipping lines at each specific time point as follows:

From May 1, 2007, the FEFC association (Far East Ships Association) has started to apply THC fees.

From July 1, 2007 IRFA (Red Sea Freight Association) announced the start of applying separation of THC fees from Vietnamese transportation fees. The fees paid to shipping lines are as high as FEFC. However, from August 1, 2008, this level was adjusted to increase from 65 dollars to 85 dollars for TEU and from 98 dollars to 115 dollars for FEU.

IADA (intra-Asian shipowners’ trade association) also negotiated Vietnamese loading and unloading fees and issues related to THC fees. Accordingly, IADA has applied THC fees since June 1, 2007.

According to shippers, separating THC fees will increase the costs of exporting goods. However, shipping companies have also adjusted and reduced sea freight rates to avoid adding extra costs to cargo owners.