Time charter equivalent calculator (TCE)

Use this free time charter equivalent calculator to work out TCE (what a voyage earns per day) from freight, commission, voyage costs and total voyage days.Enter freight, commission, bunkers (ship fuel), port costs and canal fees, and get one figure per day. Waiting time has its own row, because a day waiting at anchor usually costs more than a change in the fuel price. It is free, needs no account, and runs entirely in your browser.

The voyage

Freight

The charterer’s share and the broker’s share. Both are taken from gross freight. A broking desk often earns only one of them.

Days

Waiting is not port time or sea time. The ship uses fuel, earns nothing and makes the voyage longer, so waiting has its own row.

Bunkers (fuel)

If blank, the in-port figure is used. A ship at anchor usually uses less fuel.

Costs

Only if the ship is hired on time charter. Paid for every day, including waiting days.

The estimate

Still needs a cargo quantity, and a freight rate, and the voyage days.

Runs entirely in your browser. Nothing you type is sent to Neptune Atlas or stored anywhere.

How to calculate time charter equivalent (TCE)

When an owner is offered a cargo, they want one number: what does this voyage earn per day, and is that more than the ship could earn on a time charter (hiring the ship out by the day)? Freight per tonne cannot tell you, because it does not include how long the voyage takes. The time charter equivalent divides the result by the days.

freight                quantity x rate
less commission        address + brokerage
= net revenue
less voyage costs      bunkers + port charges + canal dues
= voyage result
/ total voyage days    ballast + laden + port + waiting
= TCE per day

Why waiting has its own row

A ship waiting for a busy berth uses fuel, earns nothing and makes the voyage longer. But it is not loading or discharging, and it is not sailing. If you add those days to port time, you hide the number a broker most wants to change. If you add them to sea time, they are counted at the sea fuel rate, which is about seven times too high. On a ship hired at 8,150 a day, three days at anchor cost 24,450 before any fuel is counted.

Errors come from the inputs, not the calculation

An estimate is usually wrong because of a guessed distance, a forgotten ballast (empty) trip, or a sea fuel rate used for days in port. That is why this page asks you for every day and every fuel rate rather than guessing them.

Where this is simpler than a real estimate

It uses one fuel price. A real estimate prices each fuel grade separately: a ship uses VLSFO (very low sulphur fuel oil) at sea and usually gas oil inside an emission control area, and they have different prices. It uses one total for port charges, not a cost list for each port. And it does not allow for bad weather in port. The charterparty (the charter contract) usually treats weather differently from waiting, even though both cost the owner fuel.

Questions

How do you calculate TCE?
Take gross freight, subtract commission to get net revenue, subtract the voyage costs (bunkers, port charges, canal dues) to get the voyage result, then divide by the total voyage days including ballast, laden, port and waiting time. The answer is a figure per day that can be compared directly against a time charter rate.
What counts as a voyage day?
Every day the ship is used for the voyage: the empty (ballast) trip to the load port, the loaded (laden) trip, the days at the berth loading and discharging, and any time waiting for a berth. Leaving out the ballast trip is the most common way an estimate makes a voyage look better than it is.
Should commission come off before or after voyage costs?
Before. Address commission and brokerage are percentages of gross freight, so they come off first. Then the voyage costs are taken from what is left. Unless the fixture (the agreed deal) says otherwise, they also come off demurrage.
What freight rate do I need to earn a given TCE?
Enter the target in the box above and the page calculates it. It is the same calculation done backwards: it finds the freight rate that gives the TCE you want.
Is this calculator free?
Yes, with no account and no limit. It runs in your browser, so nothing you type is sent to Neptune Atlas or stored anywhere.
How accurate is it?
It uses the same calculation as the Neptune Atlas voyage estimator. An automatic test on every release checks that it gives the same result as the worked example in our TCE guide, to the cent. It is simpler in the three ways listed above.

The full guide, with the worked example this page uses

Also useful: bunkers and fuel grades on why one price is a simplification, and how much cargo a ship can carry on where the cargo quantity comes from. There is also a free laytime and demurrage calculator and a free sea distance calculator for the days at sea. All four are on the free shipping tools page.

Neptune Atlas runs this estimate with real sea distances and each ship’s own fuel use, and can compare one cargo across several ships at once. See what it costs.