How to avoid Demurrage & Detention with Container xChange
How you avoid high demurrage & detention as a freight forwarder
Demurrage and Detention quickly become a shipper’s nightmare and can result in thousands of dollars in per diem charges. Costs that arise because of bad planning, unforeseen circumstances and bad communication and play such a big role in the final cost of freight. Demurrage and Detention charges are a matter of the allowed free-days – if these days are exceeded, the container user has to pay a charge calculated per day. Oftentimes carriers such as Maersk and COSCO charge up to $200 – $400 per day per container. In this article we explain Demurrage and Detentions terms and provide shippers with 5 tips how to avoid high costs when planning freight.
Meaning of Demurrage and Detention in export
Detention charges happen in export when the empty containers have been picked up for loading and is not returned within the set free-days. Typically, carriers allow for up to 5 free-days and charge shippers for extra days before the container is moved inside the terminal or depot. Demurrage charges occur when the cannot be shipped due to the lack of documentation or other non-carrier related errors. The carrier will not be able to load the container to the scheduled vessel in that case and will charge you storage costs for the period until the next scheduled vessel is ready.
Demurrage and Detention as an importer
Pick up and move your containers out of the port once they are discharged from the vessel. In conventional shipping the free-days are often somewhere between 3-5 days. A Demurrage charge is levied should it take you longer than that to get your containers. Detention refers to the time outside the port, where the sipper holds on the container beyond the allowed free-days. That is done in an attempt to decrease the containers turnaround time and make shipping more efficient.
Article Reference: American Journal of Transportation
About Author: Florian Frese is the Marketing Manager at Container xChange is an ambitious B2B marketer with a strong passion for storytelling, authenticity and smart automation. Contact Florian Frese
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