What is Time Charter Equivalent?
Time Charter Equivalent (TCE) expresses a voyage's earnings as a daily rate in US dollars, so a one-off (spot) voyage charter can be compared like-for-like with a time charter. A voyage charter pays a lump freight per tonne of cargo; a time charter pays a daily hire. TCE strips the voyage costs out of the freight and divides what's left over the days the voyage takes, giving the daily number owners and operators actually compare.
The TCE formula
TCE ($/day) = ( Gross freight − Commission − Voyage costs ) ÷ Voyage days
Where:
- Gross freight = freight rate ($/t) × cargo quantity (t)
- Voyage costs = bunker fuel + port disbursements + canal dues
- Voyage days = sea days (distance ÷ speed) + port days (load + discharge)
Worked example
A Capesize carries 171,000 t of iron ore from Dampier to Qingdao (~3,500 nm) at a freight rate of $10.50/t, 3.75% commission, bunkers at $600/t. Gross freight is about $1.80m; after commission and roughly $0.48m of bunker and port costs over a ~16-day voyage, the result is a TCE of roughly $75,000/day. Enter those values above to reproduce it, then flex the rate or speed to see TCE move.
Why TCE matters
TCE is the single most-watched earnings metric in dry bulk. It lets an owner decide whether a spot voyage beats fixing the ship on time charter, lets an operator rank competing cargoes, and underpins the vessel-class earnings you see quoted alongside the Baltic Dry Index. Because bunker price and freight rates move daily, treat any single TCE as a snapshot and re-run it with live numbers.
This calculator is also a paid API endpoint. Call GET /v1/tce for machine-readable TCE, or browse all endpoints — BDI analytics, freight, voyage, bunker and CO₂ — on the API page.
Related tools
Voyage estimator (P&L + breakeven) · Freight cost estimator ($/t) · All shipping tools