Terminal Handling Charges (THC) Explained 2026: What Forwarders and Shippers Should Know

Terminal handling charges, almost always shortened to THC, are the fees a terminal operator levies on every container that moves across its quay. They cover the physical work of getting a box off a truck or a train, onto a vessel, and back off again at the other end: crane lifts, yard moves, seal checks, gate in and gate out, and the temporary storage that sits in between. Every ocean shipment carries THC, and on most bookings the charge appears twice: once at the port of loading as origin THC (OTHC), and once at the port of discharge as destination THC (DTHC).

This guide explains what THC actually covers, how origin and destination THC split under each Incoterm, what THC costs at the world's busiest container ports in 2026, how the charge differs on FCL and LCL cargo, and where forwarders most often mis bill it and lose the customer relationship as a result.

What is a terminal handling charge (THC)?

A terminal handling charge is a fee that a container terminal operator collects for handling a container during its stay at the port. It is levied by the terminal, invoiced by the ocean carrier to the paying party, and then either absorbed as a cost of the freight rate or on billed to the shipper or consignee as a separate line item.

The terminal operator is a distinct commercial party. In most ports the terminal is owned by a stevedoring company such as PSA, DP World, ICTSI, Eurogate, or a joint venture between one of these operators and a shipping line. The port authority itself owns the land and the wharf infrastructure but does not do the container handling. THC is the terminal's revenue for the physical work; port dues and wharfage are separate charges collected by the port authority and paid by the carrier.

THC is normally quoted in local currency at Asian and European ports and in US dollars at US ports. Carriers publish origin THC and destination THC as separate line items on the quotation and the freight invoice. Every ocean booking carries a THC on both ends, and neither is optional; the split of who pays each one is set by the Incoterm on the underlying sales contract.

Origin THC vs destination THC

The two THC events on any ocean booking are structurally different, and it is worth keeping them straight on the quotation. Origin THC (OTHC) is the fee the export terminal charges for taking the container from the truck at the gate, moving it through the yard, and lifting it onto the vessel. Destination THC (DTHC) is the mirror image at the import port: the vessel lift, the yard move, and the gate out to the trucker.

Origin THC is almost always invoiced to the shipper by the ocean carrier at origin and paid in the origin currency at the origin rate card. Destination THC is invoiced to the consignee by the carrier at destination in the destination currency. On a shipment from Shanghai to Los Angeles, the shipper sees an origin THC quoted in USD equivalent from the Shanghai rate card, and the consignee sees a separate destination THC quoted in USD from the Los Angeles rate card. Both are levied on the same container, but by different terminal operators for different work.

Which party in the sales contract absorbs origin THC and which absorbs destination THC is not a carrier decision. It is set by the Incoterm. Under most C group and F group Incoterms the seller pays origin THC and the buyer pays destination THC. Under D group Incoterms the seller pays both. Under EXW the seller pays neither. The Incoterm rule is worked out in the section below, but the important operational point is that the forwarder should confirm the Incoterm at the point of booking so that origin THC is invoiced to the party that has actually agreed to pay it. Rate management platforms such as Rate Management Quoting Software for Forwarders hold OTHC and DTHC as separate rate lines against every trade lane so the quotation reflects the split automatically.

What does THC cover?

The precise scope of THC differs a little from one terminal to another, but the following activities are almost always included on both origin and destination:

• Container movement between the vessel and the yard, using ship to shore gantry cranes on the quay and rubber tyred gantries or reach stackers in the yard
• Gate in and gate out procedures, including the truck appointment scan, the container number match against the booking, and the printed release note
• Seal integrity check on arrival at the gate and again at the vessel side
• Container physical inspection for exterior damage before load out and after discharge
• Temporary storage at the terminal within the free time window (usually 3 to 7 days on export and 4 to 7 days on import)
• Yard moves for restow, block shuffling, or repositioning ahead of loading
• Handling equipment (ship to shore cranes, RTGs, reach stackers, terminal tractors)

THC does not cover the following, which are billed as separate line items even though they happen at the same terminal:

• Demurrage. Storage of the container at the terminal past the free time window. Billed by the day, per container, and increases sharply with each day beyond free time.
• Detention. Time the container spends off the terminal, at the consignee's warehouse, past the carrier's free detention window. Billed by the day, per container.
• Port dues and wharfage. Fees paid to the port authority (not the terminal) for use of the wharf and the port infrastructure. Usually invoiced to the carrier and absorbed in the freight rate rather than passed to the shipper as a separate line.
• CFS charges. Container freight station charges for stuffing and stripping of LCL cargo at an off dock warehouse. CFS work happens outside the terminal fence and is billed separately.
• Reefer plug in and monitoring. Additional charges for reefer containers plugged into terminal power and monitored for temperature.
• Hazardous cargo surcharges. An IMO class surcharge on top of the base THC for hazardous cargo, reflecting the additional handling and segregation requirements.

How Incoterms determine who pays THC

The Incoterm on the commercial invoice tells you where the seller's responsibility for cost ends and the buyer's responsibility begins. For THC, that boundary decides who pays origin THC and who pays destination THC. The 2020 Incoterms give a clean split.

The pattern is simple in principle. F group Incoterms (FCA, FAS, FOB) hand the container to the carrier at the origin, so the seller pays origin THC and the buyer pays destination THC. C group Incoterms (CFR, CIF, CPT, CIP) require the seller to pay the freight to the destination, which usually means origin THC is included in the freight rate the seller pays; destination THC still falls to the buyer. D group Incoterms (DAP, DPU, DDP) require the seller to deliver to the buyer's place, which means the seller pays both. EXW is the outlier: the buyer collects at the seller's premises and therefore pays every downstream cost including both THCs. If the invoice does not name the Incoterm, or the Incoterm is written without a named place (a common defect), the forwarder should stop and get it confirmed in writing before invoicing THC.

2026 THC rates by port

THC is published by each terminal operator and reviewed annually. The table below shows indicative 2026 rates at the world's busiest container gateways for a standard dry FCL container in USD or EUR equivalent. Actual invoices vary by carrier, contract, and the mix of terminals inside a single port complex, so always cross check against the carrier's live rate sheet before quoting.

Three observations for planning. First, the Asian export ports cluster tightly around the $150 to $180 per TEU band, which reflects the high throughput and standardised operations at those terminals. Second, US ports run roughly twice the Asian rate, driven by labour costs, chassis handling, and higher terminal operating costs. Third, north European ports move in EUR and normally publish a 12 month rate that is stable within the year, whereas US and Asian rates are more likely to move mid year in response to congestion or fuel cost pressure. THC is one of the more forecastable line items on a forwarder's rate card and moving it into Ocean Freight Management Software alongside base ocean freight, BAF, and CAF gives an accurate landed cost quote in seconds.

FCL vs LCL: how THC is charged

THC is charged differently on a full container load and a less than container load shipment. FCL is a per container fee. LCL is a per revenue ton fee.

LCL THC is quoted on a W/M basis, which is short for "weight or measure, whichever is higher." One revenue ton equals one cubic metre of volume or one metric tonne (1,000 kg) of weight; the carrier bills whichever number is greater. A 3 CBM, 800 kg parcel bills at 3 revenue tons because volume wins. A 1 CBM, 2,000 kg parcel bills at 2 revenue tons because weight wins. The revenue ton framework is standard across ocean LCL, and the LCL consolidator applies it to origin THC, destination THC, and the CFS charge on the same shipment.

Common THC billing mistakes forwarders make

1. Double billing THC to the same party. This happens when the seller under CFR or CIF pays origin THC as part of the freight rate, and the forwarder then invoices origin THC to the buyer as a separate line item at destination. The buyer refuses the charge because they never agreed to pay it, and the forwarder writes it off. Read the Incoterm before generating the invoice, and mark origin THC as "included in freight" on any C group booking.

2. Confusing THC with the general rate increase (GRI). A GRI is a temporary uplift on the ocean freight base rate that carriers introduce during peak season or after a rate benchmark reset. It has nothing to do with the terminal. If the carrier bundles a GRI into the ocean freight and a shipper questions why THC "went up," the answer is almost always that the GRI moved and the terminal charge did not. Keep the two lines clearly separate on the invoice.

3. Invoicing THC to the wrong Incoterm party. The most common example is a FOB shipment where origin THC is invoiced to the buyer instead of the seller. The buyer refuses to pay, the seller refuses to reimburse, and the forwarder ends up eating the charge. The remedy is to confirm the Incoterm in writing at booking and route the OTHC invoice to the seller's account from day one.

4. Not reflecting the local currency of the port. Rotterdam THC is €200 per TEU; Los Angeles THC is $300 per TEU. Booking systems that convert everything to USD at a stale FX rate silently over or under invoice the customer by several percent per shipment. Hold the local currency on the rate card and let the invoice convert on the day of billing.

5. Missing hazardous or reefer surcharges. The base THC does not cover hazardous class handling or reefer plug in monitoring. Both are billed as a percentage uplift or a flat surcharge on top of the base THC. Forwarders who quote the base rate to a shipper of lithium ion cells or frozen protein are systematically under quoting the port cost of every booking.

6. Not documenting the THC on the House B/L. If origin THC is prepaid at origin and destination THC is collect at destination, the two events must be recorded correctly on the House B/L. A mislabelled prepaid or collect flag creates a disputed release at destination and delays the container's collection from the yard.

THC vs other port and terminal charges

THC is the largest single terminal fee on most bookings, but it is not the only one. On a busy port complex the invoice will carry several distinct line items, each with a different purpose and a different pay party.

The single most useful distinction to hold in mind is THC vs demurrage. THC is a fixed fee for the work of handling the container; demurrage is a variable time based penalty for keeping the container at the terminal too long. A container that is picked up on day 3 of a 7 day free time window pays THC and no demurrage. The same container picked up on day 10 pays THC plus 3 days of demurrage. Confusing the two on a customer invoice is a leading cause of disputed charges.

How a freight platform manages THC on every booking

THC is a small enough line to be easy to overlook and a big enough line to move a shipment's margin by several percent if it goes to the wrong party. The forwarders who bill it cleanly are the ones that treat it as a first class citizen in the rate structure, not a surcharge to be reconciled after close out.

The pattern that works in practice is to hold origin THC and destination THC as separate rate lines on every trade lane, with the local currency of the port and the terminal operator's published tariff as the reference. The quotation engine then pulls the correct OTHC and DTHC for the booking, applies the Incoterm rule to decide which side pays each, and includes both on the shipper facing quote. When the invoice is generated at close out, the same rule reapplies so origin THC is billed to the seller under FOB, CFR, and CIF, and to the buyer under EXW. This closes the loop that would otherwise create the double billing and mis routing errors described above.

On the accounting side, THC that is prepaid on the House B/L should reconcile against the carrier's invoice on the same shipment record, so the forwarder's margin on THC is visible at close out rather than lost in a monthly clearing account. A platform that handles this end to end through Freight Billing & Accounting Software for Forwarders gives the desk operator, the accounts team, and the customer a single, consistent view of every THC line on every booking, in local currency, tied to the Incoterm and the terminal that generated it.

Frequently Asked Questions

What is a terminal handling charge (THC)?

A terminal handling charge, or THC, is the fee that a container terminal operator collects for handling a container at the port. It covers the physical work of moving the container between the vessel and the yard, gate in and gate out procedures, seal integrity checks, container inspection, and the temporary storage that happens within the free time window. THC is levied by the terminal, invoiced by the ocean carrier to the paying party, and appears as a separate line item on the freight invoice at both the origin port and the destination port.

What does THC cover at the port?

THC covers container movement between the vessel and the yard using ship to shore gantry cranes on the quay and rubber tyred gantries or reach stackers in the yard, gate in and gate out procedures, the seal integrity check on arrival and again at vessel side, exterior container inspection before load out and after discharge, temporary storage within the free time window (usually 3 to 7 days on export and 4 to 7 days on import), yard moves for restow or block shuffling, and the use of the terminal's handling equipment. THC does not cover demurrage, detention, port dues, wharfage, CFS stuffing and stripping charges, reefer plug in, or hazardous cargo surcharges; each of those is billed as a separate line item.

Who pays origin THC and destination THC?

The split is set by the Incoterm on the commercial invoice. Under F group Incoterms (FCA, FAS, FOB) the seller pays origin THC and the buyer pays destination THC. Under C group Incoterms (CFR, CIF, CPT, CIP) the seller pays origin THC as part of the freight rate and the buyer still pays destination THC. Under D group Incoterms (DAP, DPU, DDP) the seller pays both. Under EXW the buyer pays both because the buyer collects the goods at the seller's premises and takes on every downstream cost from there. The forwarder should confirm the Incoterm in writing at booking so the OTHC and DTHC invoices route to the right party from the start.

How much does THC cost in 2026?

2026 THC rates for a standard dry FCL container are approximately $150 per TEU and $225 per FEU at major Chinese export ports (Shanghai, Ningbo, Yantian), $170 to $180 per TEU at Busan, Hong Kong, Singapore, and Jebel Ali, €195 to €200 per TEU at Rotterdam, Hamburg, and Antwerp, $300 per TEU at Los Angeles and Long Beach, and $340 per TEU at New York and New Jersey. FEU rates are typically 1.5 times the TEU rate. Actual invoices vary by carrier, contract, terminal, and cargo type, so always cross check the carrier's live rate sheet before quoting.

How is THC charged on LCL shipments?

LCL THC is charged per revenue ton on a W/M (weight or measure) basis. One revenue ton equals one cubic metre of volume or one metric tonne of weight, whichever is higher for the parcel. A 3 CBM, 800 kg parcel bills at 3 revenue tons because volume wins; a 1 CBM, 2,000 kg parcel bills at 2 revenue tons because weight wins. Typical LCL origin THC on China exports runs $15 to $25 per revenue ton in 2026, so a 5 CBM parcel from Shanghai is roughly $75 to $125 of origin THC. The CFS stuffing and stripping charge is billed on top and is not part of THC.

Is THC included in the ocean freight rate?

Usually no. Ocean freight is quoted as a base rate, and THC appears as a separate line item on the quotation and the invoice. There are two common exceptions. Under CFR and CIF the seller pays origin THC as part of the freight rate they arrange, which means origin THC is included in the price the buyer sees on the commercial invoice even though it is still a distinct line on the carrier's freight invoice. And on all in "door to door" quotations issued as a single number, THC is often bundled with base ocean freight, BAF, CAF, and other surcharges into a single delivered rate. In every other case, expect THC to appear as its own line at both origin and destination.

What is the difference between THC and demurrage?

THC is a fixed fee for the work of handling the container at the terminal within the free time window. Demurrage is a variable time based penalty for keeping the container at the terminal past the free time window. A container picked up on day 3 of a 7 day free time window pays THC and no demurrage; the same container picked up on day 10 pays THC plus 3 days of demurrage. THC is billed once per shipment; demurrage is billed by the day, per container, and escalates the longer the container sits.

Under FOB Incoterms who pays THC?

Under FOB the seller pays origin THC at the port of loading, because the seller's cost responsibility ends when the goods are on board the vessel. The buyer pays destination THC at the port of discharge, because the buyer's cost responsibility starts from that point onwards. In practice, the carrier still sends the origin THC invoice to the party who books the vessel, which under FOB is normally the buyer's nominated forwarder; the seller then either reimburses the buyer's forwarder or pays the carrier directly. Confirm the reimbursement route in writing at booking to avoid the routine dispute at close out.

Under CIF Incoterms who pays THC?

Under CIF the seller pays cost, insurance, and freight to the named port of destination, which means origin THC is included in the freight rate the seller pays. The buyer still pays destination THC at the port of discharge, because the seller's obligation ends at the destination port on the vessel and the discharge is on the buyer's account. If a CIF invoice shows origin THC as a separate line to the buyer at destination, that is a double billing error and the buyer should push back on it.

Can THC be double billed to a shipper?

Yes, and it is one of the most common mistakes forwarders make on C group Incoterms. It happens when the seller under CFR or CIF pays origin THC inside the freight rate, and the forwarder at destination then invoices origin THC to the buyer as if it had not been paid. The buyer refuses the charge because they never agreed to pay it, and the forwarder writes it off or eats the dispute. The remedy is to read the Incoterm before generating the invoice and mark origin THC as "included in freight" on any CFR or CIF booking.

Does THC differ between a TEU and a FEU container?

Yes. THC is published as a rate per TEU (20 ft equivalent unit) and per FEU (40 ft equivalent unit), and the FEU rate is normally about 1.5 times the TEU rate. At Shanghai in 2026 the indicative rate is $150 per TEU and $225 per FEU; at Los Angeles it is $300 per TEU and $450 per FEU. A 40 ft high cube container is charged at the same FEU rate as a standard 40 ft dry container in almost every port. Reefer, tank, flat rack, and open top containers carry a surcharge on top of the standard FEU rate to reflect the additional handling requirements.

What is the difference between THC and CFS charges?

THC is the handling fee the terminal operator charges for moving a container between the vessel and the yard within the port. CFS (container freight station) charges are the fee an off dock warehouse charges for stuffing multiple LCL parcels into a shared container at origin, or stripping the shared container back into individual parcels at destination. CFS charges apply only to LCL cargo and are billed by the consolidator or the CFS operator, not the terminal. FCL cargo is stuffed at the shipper's premises and delivered as a single sealed container to the terminal, so there is no CFS charge on a full container load.

Keep Reading

• Detention and Demurrage: New FMC Regulations and the Role of Visibility
• FCL (Full Container Load): The Complete Guide for Freight Forwarders
• What Is Incoterms: All You Need to Know