Freight Rate
Definition
A freight rate is the price a carrier charges to move a shipment between two points, quoted per container, per truckload, per hundredweight, or per kilogram depending on the mode. Rates vary with distance, capacity, commodity, and market conditions.
In Practice
Freight rates come in two broad forms: contract rates, negotiated for a fixed period on defined lanes, and spot rates, priced transaction by transaction against current market capacity. The base rate is rarely the whole invoice; fuel surcharges and accessorials are added on top, so comparing carriers means comparing all-in cost, not headline rates.
For planners, rates are a living input, not a constant. Truckload and ocean markets swing widely with capacity cycles, so a lane budgeted in a soft market can cost 50 percent more a year later. Most operations maintain a routing guide of contracted carriers by lane and monitor spot benchmarks to know when the guide is out of market.
For example, a shipper might contract a Chicago to Dallas dry van lane at 1,850 dollars, then watch spot rates: if spot falls far below contract, volume leaks to brokers; if it spikes, carriers start rejecting tenders.
Related Calculators
Related Terms
A fuel surcharge is a variable fee carriers add to freight bills to pass through changes in fuel prices, usually calculated from a published index such as the US Department of Energy diesel average. It rises and falls with the market rather than being renegotiated.
Accessorial ChargesAccessorial charges are fees carriers add for services beyond standard dock-to-dock pickup and delivery, such as liftgate service, residential delivery, inside delivery, redelivery, or driver detention. They appear as line items on top of the base freight rate.
Freight ClassFreight class is a standardized rating system used in US less-than-truckload shipping that groups commodities into 18 classes, from 50 to 500, based on density, stowability, handling, and liability. Higher classes cost more to ship per pound.
CarrierA carrier is a company that physically transports freight, such as a trucking company, ocean line, airline, or railroad. Carriers contrast with intermediaries like brokers and forwarders, who arrange transport but do not operate the equipment.