Demurrage

What is demurrage?

Demurrage is an additional cost incurred by the recipient or sender of goods when the vehicle, container or transport unit remains stationary for longer than the agreed free waiting time. Demurrage charges are applied in various modes of transportation, including road, rail, sea and air.

There are two main types of demurrage charges:

• Detention: a fee charged when the recipient keeps a container or vehicle longer than the specified free time.
• Demurrage: a fee charged when cargo remains at the terminal longer than stipulated in the contract.

Frequently asked questions (FAQ)

1. When are demurrage charges applied?

Demurrage charges can be applied in different situations depending on the type of transportation. In road transportation, they occur when a vehicle waits to be loaded or unloaded for longer than specified in the transportation order. In sea transportation, they apply to containers that remain in the port after the specified free time. In rail transportation, demurrage charges are incurred if wagons are waiting to be unloaded for longer than expected. In air transportation, demurrage charges are incurred if cargo is not picked up within a set time after arrival.

2. What are the standard free waiting periods?

The free storage time varies depending on the mode of transportation. In international road transportation, it is usually 2-3 hours for loading or unloading, after which fees are charged. In maritime transportation, the standard free storage time for a container in a port is 3-7 days, depending on the country and shipping line. In rail transportation, it is usually 12 to 48 hours for unloading, and in air transportation, the free storage time is usually 24 to 48 hours.

3. What are some examples of demurrage rates?

Demurrage rates depend on the type of transportation and logistics provider. In road transportation, they range from 30 to 100 EUR for each additional hour of demurrage. In sea transportation, container fees start at 50-150 USD per day for 20′ containers and 100-300 USD for 40′ containers. For rail transportation, they can range from 10 to 50 EUR per wagon per day, and for air transportation, they depend on the weight and volume of the goods.

4. How can demurrage charges be avoided?

To avoid demurrage charges, it is crucial to plan the delivery logistics carefully. Make sure that the recipient is ready to accept the cargo at the agreed time and optimally adjust the loading and unloading schedule. An important element is to monitor the status of the shipment and track containers and vehicles in real time. You can also negotiate conditions with carriers, which, in the case of regular cooperation, may allow you to extend the free demurrage time.

5. What happens if demurrage charges are not paid?

Failure to pay demurrage charges can have serious consequences. In the case of demurrage, failure to pay may result in the cargo being detained and making it difficult to collect. Carriers may also charge additional financial penalties if the return of the container or vehicle is significantly delayed. Long-term arrears may result in the company being blacklisted, which may prevent future cooperation with carriers.

Demurrage is an important element in international logistics and transportation that can significantly affect delivery costs. Therefore, it is important for companies to plan their operations carefully, monitor loading and unloading times, and negotiate terms with carriers to avoid unnecessary costs.