Demurrage

Definition

Demurrage is the fee assessed by the port or terminal facility if your cargo remains at the facility after the Last Free Day (LFD). This charge applies while the container is physically located on the terminal grounds.

Charging Structure and Cost

Demurrage is charged per container, per day, until the cargo is successfully picked up from the terminal. The specific rates are determined by the port and terminal.

Typical cost ranges:

• Anywhere from $75 - $200 per container, per day, is standard.

• Terminals frequently employ progressive pricing, meaning the daily fee increases after a certain number of days to strongly incentivize timely pickup.

• These costs can be substantial, especially when combined with separate per diem or detention fees.

Expert Avoidance Advice

The key strategy for mitigating demurrage exposure is proactive communication and meticulous destination planning. It is vital to communicate with your logistics partners if a delay at the destination warehouse could push pickup past the LFD.

If a delay is unavoidable, specific preventative actions can be taken:

• Utilize a pre-pull service: The container is picked up from the highly restrictive port facility and temporarily stored at the trucker’s private yard (often called a drop-yard).

• Benefit of pre-pull: Storage fees assessed at a private yard are significantly less expensive than the demurrage fees charged by the terminal, offering substantial savings.