Demurrage

The distinction that matters: demurrage is charged while the container sits inside the terminal, and detention is charged once it leaves, when the equipment comes back late. Same container, same trip, two separate clocks, and a badly handled box can run up both.

The demurrage clock starts when the container is discharged from the vessel. Free time runs (whatever the tariff or contract grants, commonly four to seven days), then the meter starts, usually on an escalating scale where day eight costs more than day one. The charge attaches to the container regardless of whose fault the delay is.

That no-fault structure is why it stings. Customs holds, missing paperwork, full receiving docks, chassis shortages, and late drayage pickups all burn free days, and during severe port congestion importers have paid demurrage on boxes the terminal physically could not release. Watching container dwell time daily, rather than discovering it on an invoice, is the difference between a fix and a fee.

The mitigation playbook is unglamorous: a per-container free-time expiry report, standing pre-pull arrangements with dray carriers, customs entries filed before vessel arrival, and extended free time negotiated into annual ocean freight contracts on lanes where delay is routine.

Frequently asked questions

What is demurrage in shipping?

Demurrage is the fee an ocean carrier or terminal charges when a loaded import container stays at the port beyond its allotted free time, commonly four to seven days after discharge from the vessel. It is billed per container per day, often on an escalating scale where day eight costs more than day one.

What is the difference between demurrage and detention?

Demurrage is charged while the container sits inside the terminal, and detention is charged once it leaves, when the carrier's equipment comes back late. Same container, same trip, two separate clocks, and a badly handled box can run up both: one container picked up four days late accrued $740 of demurrage, then sat so long at the consignee's yard that the empty returned late and added $450 of detention.

Who pays demurrage when the delay is not the importer's fault?

Demurrage attaches to the container regardless of whose fault the delay is. Customs holds, missing paperwork, full receiving docks, chassis shortages, and late drayage pickups all burn free days, and during severe port congestion importers have paid demurrage on boxes the terminal physically could not release. That no-fault structure is exactly why the charge stings.

How much does demurrage cost?

Demurrage rates typically escalate with each day past free time. In one example, a container at Long Beach with five free days was held by a customs exam through day nine: days six and seven billed at $185, days eight and nine at $370, for $1,110 on a single box, which was more than the drayage itself.

How do importers avoid demurrage charges?

The demurrage playbook is unglamorous: a per-container free-time expiry report watched daily, standing pre-pull arrangements with drayage carriers, customs entries filed before vessel arrival, and extended free time negotiated into annual ocean freight contracts on lanes where delay is routine. One importer moving 600 containers a year extended contractual free time from five days to ten, a clause worth roughly $43,000 annually against its delay history.