By the Waymore Shipping Operations Team | Last updated: October 12, 2026 | 12 min read

Fixed Rate vs Floating Rate: When to Lock Your Freight Price

A fixed freight rate is a price your forwarder guarantees for a set period — usually 2 weeks to 3 months — on a specific lane, container type, and volume, while a floating rate tracks the spot market and changes with every booking. Lock when your volumes are steady and a rate spike would eat your margin; float when the market is falling or your shipments are small and irregular. The table below shows what the difference looks like in real dollars on a Shanghai–Los Angeles 40HC lane.

At Waymore we quote both structures every day, and the right answer is almost never ideological. Some of our longest-standing clients lock every quarter; others have floated happily for years because their volumes are lumpy and their tolerance for a bad booking is higher than a lock premium. This guide gives you the decision framework we use on the operations desk.

How Does a Fixed Freight Rate Actually Work?

When you lock a rate, your forwarder commits capacity and price for the agreed window. Under the hood, the forwarder is typically drawing on contracted space with carriers — the kind of allocation behind the discounted rates we explain in how we lock discount rates with carrier space — and passing a portion of that commitment to you at a guaranteed number.

Three things define a lock, and you should get all three in writing:

1. Scope: exact port pair (e.g., Shanghai to Long Beach), container types (20GP/40GP/40HC), and sometimes a weekly volume ceiling.
2. Duration: commonly 14, 30, 60, or 90 days. Longer locks usually carry a bigger premium because the forwarder is underwriting more market risk.
3. What floats anyway: pass-through surcharges. Fuel-related and currency-related adjustments, destination terminal charges, duties, and trucking are normally excluded — a fact that surprises importers who assumed "fixed" meant all-in.

If a quote promises a rock-bottom locked price with no exclusions listed, treat it with the skepticism our guide on hidden fees in freight quotes deserves. Fixed and transparent are two different promises; you want both.

What Does a Floating Rate Track?

Spot ocean rates move weekly — sometimes daily in volatile quarters. Two references dominate the market's conversation. The Shanghai Shipping Exchange publishes the SCFI, a spot index covering routes out of Shanghai, while Drewry's World Container Index tracks a composite of eight major lanes. When these indexes trend up, your floating quotes will follow within a week or two; when they slide, spot bookings get cheaper. We teach clients to read these numbers properly in our guide to the SCFI and other freight rate indexes.

The practical implication: a floating rate is not "the market price" — it is a snapshot. Two importers booking the same lane four days apart can pay meaningfully different numbers for identical containers.

Fixed vs Floating: A Real Cost Comparison

Here is a worked example using a hypothetical but realistic Q4 pattern on Shanghai → Los Angeles, 40HC. An importer ships 12 containers across three months (4 per month) and chooses between a 90-day lock and floating each booking:

Notice the subtlety: the floating importer won in November and lost badly in January. Over the window, the lock saved roughly 9% — but the bigger advantage was never the savings, it was that the fixed importer could price his Q4 promotions back in November without a hedging margin for freight spikes. And had the market instead slid through the quarter, the floating importer would have won on price while giving up space certainty — in a tight market, spot cargo also rolls first.

When Should You Lock a Fixed Freight Rate? (5 Signals)

1. Your volumes are predictable. If you ship weekly or a few containers a month on the same lane, a lock converts your most volatile cost line into a fixed one. Locks are priced on commitment — irregular volumes waste them.
2. You've already committed prices downstream. If you quote wholesale or retail prices months ahead, freight spikes come straight out of your margin. A lock is cheaper than most hedging.
3. Seasonal pressure is coming. Q3–Q4 peak and the January pre-Chinese New Year rush are the two recurring squeeze windows; the mechanics behind the Q4 spikes are explained in why freight rates increase in Q3.
4. Index data says the market has bottomed. When SCFI and WCI readings have flattened after a decline, locking at the trough captures the cheap market for the full window.
5. Space certainty matters more than the last dollar. Brands with launch dates or FBA replenishment windows value guaranteed loading over saving $100 per box.

When Is Floating the Better Choice?

Floating wins in three situations. First, a falling market: if indexes are trending down week after week, every lock you sign is a bet against your own pocket. Second, irregular or small volumes: if you ship two containers a quarter, spot quotes each time are simpler and usually cheaper than paying for committed capacity you will not fill. Third, flexible cargo: if a container can wait a sailing — or roll to next week — spot gives you optionality a fixed rate does not.

There is also a middle path many mid-size importers ignore: short locks. A 14- or 30-day lock on a single sailing or two gives space certainty at a fraction of the 90-day premium, which is often enough to cover a critical replenishment window without committing a full quarter.

Questions to Ask Before Signing Any Rate Lock

• Exactly which charges are frozen, and which remain pass-through?
• What happens if I ship less than the committed volume — is there a penalty, or just a lost discount?
• What happens if I exceed it — does the overflow ride at spot or at the locked rate?
• Are rollovers (when my container misses the vessel) covered at the locked rate too?
• Which index, if any, is the lock benchmarked against?

One anonymized example from our files: a UK homeware importer locked a 60-day rate on Felixstowe in a soft October market, then watched spot rates jump nearly 30% by December as pre-CNY demand built. Their locked price never moved, and their landed-cost spreadsheet — the same one they had showed their buyers in September — stayed accurate to the pound. That credibility with their own customers was worth more than the freight savings.

How Do Forwarders Price a Rate Lock?

Understanding the pricing logic helps you negotiate one. When a forwarder agrees to hold your price for 90 days, it is underwriting the risk that the market rises above your locked number — either by buying space from carriers at a fixed contract level, or by adding a risk margin to the current spot level. Three factors drive the size of that margin:

• Market direction. Locking in a rising market costs more than locking in a flat one, because the forwarder's downside is larger. This is why the same lock premium that looked expensive in October can look like a bargain in December.
• Volume commitment. A client promising 4 containers a week gets sharper numbers than one asking to "lock whatever I happen to ship." Committed capacity is cheaper capacity — for both sides.
• Lock length. Each additional month of certainty adds premium, roughly in step with how uncertain index forecasts are for that horizon. Beyond 90 days, locks generally become bespoke contracts rather than standard quotes.

One practical negotiation tip: ask for a two-tier lock — a guaranteed rate for a committed base volume plus a slightly higher rate for overflow. It gives the forwarder the predictability it needs to sharpen the base price, while protecting you from paying full spot when a container lands late from your factory.

What Happens If the Market Crashes After You Lock?

It happens, and it stings. Importers who locked in early 2025-style softening quarters watched spot rates fall below their contract level within weeks. Two points of comfort — and one of caution. Comfort: a well-built lock usually includes a mid-term review clause, allowing renegotiation if a published index falls persistently below the locked level; ask for it before signing, not after. And the space priority a lock carries still has value in a falling market, because carriers blank sailings to manage capacity and spot cargo rolls first. Caution: locks without a review clause are, quite simply, a bad structure for volatile markets — if a forwarder will not put one in writing, treat that as pricing information in itself.

Frequently Asked Questions

What is a fixed freight rate?

A fixed freight rate is a price your forwarder guarantees for a defined period — typically 2 weeks to 3 months — for a specific lane, container type, and volume commitment. The ocean freight component cannot change during the lock period even if the spot market moves, though surcharges that are pass-throughs (such as fuel-related or currency-related items) and destination charges are usually still adjustable.

What is a floating freight rate?

A floating (spot) rate is valid only for the specific booking — often just days — and tracks the current market, which indexes like the Shanghai Containerized Freight Index and Drewry's World Container Index publish weekly. Floating rates can be cheaper when the market is falling, but they expose your landed cost to every spike, and in tight capacity periods the same lane can double within a month.

When should I lock a fixed freight rate?

Lock a rate when your shipping volumes are predictable, your retail or contract prices are already set, a peak or holiday season is approaching (Q3–Q4, pre-Chinese New Year), or index data shows the market has bottomed. If you ship weekly or more on a stable lane, a lock protects your margin against the spikes that historically hit hardest in the second half of the year.

When is a floating rate the better choice?

Float when the market is trending down, your volumes are small or irregular, your cargo is flexible enough to wait a sailing or two, or you are testing a new supplier or lane. Importers shipping only a few containers a year usually do better quoting spot each time than paying a lock premium for capacity they will not fully use.

Do fixed freight rates include all charges?

No — a fixed rate locks the ocean freight and typically the surcharges built into the quote at signing, but pass-through items such as fuel or currency adjustments, destination port charges, duties, and local trucking are generally quoted separately and can move. Always ask which components are frozen and which float, and compare the all-in estimate rather than the headline number.