Demurrage is a fee charged by a terminal when cargo remains onsite beyond the last free day. These charges are applied daily per container and continue to accrue until the container is picked up—either from ocean container terminals or rail terminals.
Each port of entry may have its own specific rules for how demurrage is calculated and how long a container’s free time lasts. As a result, it is extremely important for shippers to understand the regulations of the particular ports their cargo will pass through.
Common Reasons for Receiving Demurrage Fees:
- The consignee (receiver of the goods) was unaware of the cargo’s arrival date, preventing timely customs clearance or pickup
- The consignee received incomplete or delayed customs documentation, resulting in a pickup delay
- A customs exam or hold caused a delay in processing the container
- The cargo received did not match the sales order, creating a dispute between the shipper and consignee
Tips for Avoiding Demurrage Fees:
- Plan ahead to ensure truckers are available to pick up the container as soon as it’s ready
- Have a backup plan in case the original trucker or transport provider becomes unavailable
- Maintain regular communication with your freight forwarder and stay informed about the local port’s regulations and customs procedures
- If your shipment is likely to face special inspections or customs holds, consider requesting additional free days from the terminal to allow for processing delays
Understanding demurrage and planning proactively can help shippers avoid unnecessary fees and keep their supply chains moving efficiently.