Demurrage
Definition
Demurrage is a charge assessed when a container stays at a port or rail terminal beyond its allotted free time before being picked up. It is billed per container per day and escalates the longer the box sits.
In Practice
Ocean carriers and terminals grant a set number of free days, often three to seven, for an import container to be collected after discharge. Once the last free day passes, demurrage accrues daily, frequently on a rising scale, and the container generally cannot be released until charges are settled.
For planners, demurrage is one of the most avoidable costs in an import operation, yet it appears constantly when customs holds, missing paperwork, dray shortages, or full warehouses delay pickup. Tracking discharge dates and last free days for every inbound container, and prioritizing boxes approaching their deadline, is standard practice.
As an example, a container discharged on Monday with four free days must be out of the terminal by Friday; if a customs exam holds it until the following Wednesday, the importer pays several hundred dollars per day for the overstay.
Related Calculators
Related Terms
Detention is a charge for keeping a carrier's equipment, such as a container outside the terminal or a trailer at a dock, longer than the agreed free time. In trucking it also refers to fees for holding a driver beyond the allotted loading or unloading window.
DrayageDrayage is the short-distance trucking of containers, typically between a port or rail ramp and a nearby warehouse, yard, or terminal. It is the connecting link at each end of an intermodal or ocean move.
Customs ClearanceCustoms clearance is the process of getting goods approved by government authorities to enter or leave a country, including filing declarations, paying duties and taxes, and satisfying any inspections. Goods cannot be delivered until clearance is complete.
Ocean FreightOcean freight is the transport of goods by sea, typically in standardized containers aboard container ships. It is the dominant mode for international trade, offering the lowest cost per unit at the price of long transit times.