Demurrage & Detention Calculator

Understanding Demurrage & Detention

Demurrage and detention charges represent significant cost factors in international shipping that can substantially impact your total landed costs. These charges serve as economic incentives to ensure efficient container turnover and terminal capacity management. Demurrage applies when containers remain at the port terminal beyond the allocated free time, effectively charging for storage space and the opportunity cost of terminal capacity. Detention charges apply when containers are kept outside the terminal beyond the permitted period, compensating carriers for lost container utilization.

Understanding the distinction between these charges is crucial for effective cost management. Demurrage is typically charged by the terminal operator and begins when free time expires after vessel discharge. Detention is charged by the ocean carrier and applies to the period when you have possession of the container outside the terminal. Different carriers and terminals have varying policies, rate structures, and free time allocations, making it essential to understand your specific contractual terms for each shipment route and carrier relationship.