What is the demurrage charge of container?
Demurrage is a charge applied to containers that are left at the port or rail yard longer than their allotted free time, or past the “Last Free Day.” Shippers begin incurring this fee the day after the last free day and it is charged per container / per day until the container is picked up.
What is the difference between container detention and demurrage?
Demurrage is charged by the shipping line per day per container from the date of discharge till the full container is moved out of the port or terminal for unpacking. Detention is charged per day per container from that time till the empty container is returned to the shipping line’s nominated depot.
Who is responsible for container demurrage?
shipper
The shipper is generally responsible for demurrage charges, but the consignee also may be legally obligated to pay, depending upon who was at fault for the delay and which party was contractually responsible to pay freight or other charges.
How do you calculate demurrage?
How are demurrage charges calculated? In the calculation of Demurrage charges to the shipowner/port authority, the demurrage rate is multiplied by the number of days/part days over the agreed free days.
What is demurrage & detention?
Demurrage refers to the charge that the merchant pays for the use of the container within the terminal beyond the free time period. Detention refers to the charge that the merchant pays for the use of the container outside of the terminal or depot, beyond the free time period.
Why is demurrage charged?
Demurrage & Detention come out to play when a carrier or shipping line’s containers aren’t delivered back within the allowed free days. The free days determine the number of days a shipper can use the container for free. If the free time is exceeded, the user has to pay a demurrage and detention charge.
What are the reasons for demurrage?
Here are some of the major causes for demurrage and detention..
- Delays due to incorrect documentation.
- Delays due to late receipt of documents.
- Delays due to loss of documents.
- Delays due to customs clearance or cargo inspection.
- Delays due to release of cargo at destination.
- Delays due to receiver being unreachable.
What is detention container?
In this case, detention refers to the time outside the port, where the consignee holds on to the carrier’s container beyond the allowed free-days. Thus, a detention charge is applied when the container has been picked up, but not returned to the carrier.
What is container free time?
Free time is a given amount of time allotted for such pick up. If containers imported or exported are not properly picked up and removed from a port, a terminal, or anywhere else, they start to accumulate charges much like a car parked in a public location accumulating hourly charges.
How much is demurrage fees?
How much does demurrage cost? Daily charges range from $75 to $150 per container per day; however, charges can and do increase the longer the cargo stays on the terminal. For example, Let’s say you have 3 days of free time. After that, a charge of $100 per day applies for 3 days.
What are demurrage charges?
What are demurrage charges?: Demurrage is a fee charged by ocean carriers, trucking companies, and railroads when a container is not removed from the port by the last free day, as allocated in your agreement with the shipper. The demurrage fee and time vary by shipping line.
What are demurrage fees?
Demurrage fees are charged when import containers are still full and under the control of the shipping line. In this situation, the container has not yet been picked up by the consignee, and the free time for pick up set by the ocean line has expired for the container.
What is demurrage charges in logistics?
In logistics, supply chain and shipping industry, the words demurrage and detention charges are widely used term for financial related fines. The fines are issued in the event of shipping violations during imports and/or exports. Although to the common person, the two terms Demurrage and Detention are almost similar.