To many customers around the world, demurrage and detention costs represent some of the most expensive fees that they will incur in the process of a trade transaction..
Although demurrage and detention are not standard charges that are applicable on every shipment, there are many shipments on which these charges are levied..
They are probably two terms that top the list of controversial charges levied by shipping lines on customers..
For those of you who may not be aware of what Demurrage and Detention is,
- Demurrage relates to cargo (while the cargo is in the container)
- Detention relates to equipment (while the container is empty – after unpacking or before packing)
For many shipping lines, demurrage and detention is a necessary evil but importers and exporters around the world may beg to differ..
There are many reasons why demurrage and detention charges may be incurred :
- Delays due to incorrect documentation
- Delays due to late receipt of documents
- Delays due to loss of documents
- Delays due to inspections
Carriers should not lose money because customers are unable to clear their containers or have delays in returning the containers. At the same time, customers should also not be penalised for cases that maybe beyond their control..
The seriousness of demurrage and detention charges is evident when you consider that EVERY shipment has the potential to incur both these charges during loading and unloading..
Demurrage and Detention really are avoidable costs and it is something that can be defeated with data..
Learn exactly how, in a webcast which focuses on ways and means customers can reduce and/or avoid demurrage and detention charges through the effective usage of data..
The webcast will be hosted by myself – Hariesh Manaadiar – and I am joined by
- Josh Brazil– COO of Ocean Insights ;
- Angela Czajkowski– Director of Supply Chain at Shapiro
- Amir Rashad– CEO of Centersource an end-to-end supply chain automation platform
Hi Harriesh
Thank you for this article, most clients find it had to understand why they should pay for these charges since they seem to be one and the same thing with different meaning since it all applies to the same cargo. Then there is the issue of storage charges which starts four days after container discharge it really pains the pocket
Concerning the two charges or should we call fines… Shipping lines should consider especially when the container is held by the Customs Officials and the free days does not stop counting leading to Detention fee.
Under such circumstances, shipping lines or agency should not penalize the importer.
That’s a a painful fee to pay.
Interesting, will attend. Fair Trade will benefit all. Shipping lines will turnaround containers faster for more business while shippers save on demurrage and detention charges. In the east african region, containers are delayed because those charges are never budgeted for in business! Therefore it increases the number of days it takes to arrange the payments. We recognise that delays are most of the time not due to shippers wish, always beyond their control, e.g inspection.