What is Demurrage..??

Demurrage, is a charge levied by the shipping line to the importer in cases where they have not taken delivery of the full container and move it out of the port/terminal area for unpacking within the allowed free days..

Example :

A container is discharged off a ship on the 2nd July.. Consignee approaches the shipping line to take delivery of the cargo around 12th July..

If we consider the standard free days offered by the shipping line (different to port free days) as 7 days from date of discharge, the free days will expire on the 8th of July..

As of the 12th July, the box would have been sitting in the port/terminal for a total of 11 days..

11 days dwell time – 7 free days = 4 days that the box has overstayed its welcome in the port/terminal..

So, the line will be eligible to charge the consignee DEMURRAGE for 4 days from 9th to 12th July at a rate fixed by the line..

Courtesy: Hariesh Manaadiar