Demurrage is a charge for keeping a container or cargo at a terminal beyond the allowed free time. In container shipping, it generally relates to time the equipment remains inside the terminal after availability or before export loading.
When does demurrage begin?
The start event, free-time days and counting method depend on the carrier, terminal, contract and location. Weekends and holidays may or may not count.
How is demurrage calculated?
If five free days are allowed and a container stays eight chargeable days, three days are billed. At $150 per day, the illustrative charge is $450. Tiered rates may increase over time.
Demurrage versus detention
Demurrage generally applies while the container is inside the terminal. Detention generally applies after equipment leaves the terminal and is not returned within free time.
How can it be reduced?
Prepare documents before arrival, monitor customs holds, arrange appointments and transport early, confirm availability and escalate release issues before free time expires.
What should be verified on an invoice?
Check the container, availability or gate-in date, free-time entitlement, chargeable days, tariff, holds outside the customer’s control and any approved waiver.
