What is Demurrage and Detention?
Detention and demurrage are charges that can come up in the shipping industry, yet they’re not the same. The difference in detention vs. demurrage:
- Demurrage charges are related to removing the container to unpack it on time.
- Detention charges stem from not returning the empty container in time after unpacking it.
Reasons for Demurrage and Detention Charges
The transportation industry adds fees at every possible opportunity. In this case, the charges help control port congestion. Congestion impacts the efficiency of a single supply chain and gets in the way of other supply chains moving properly. That’s why these charges and fees are essential.
Calculating Charges
Demurrage charges are calculated per container daily, starting with the discharge date. Charges continue until the importer removes the full container from the port or terminal.
Port Congestion and Its Effects on Demurrage and Detention Charges
- Conflicts around the world.
- Worker strikes.
- Weather delays.
- Overbooking a port or terminal.
Of course, importers contribute to congestion by failing to remove a full container for unpacking or returning the empty container after unpacking. Fees help minimize this form of port congestion.
Find out how shipment & order visibility aids in reducing detention & demurrage.
Strategies to Reduce Demurrage and Detention Charges
These fees can greatly add up from day to day, especially throughout many shipments. Cost control required consideration of ways to avoid charges. These are steps that can help:
- Carry out advanced planning and negotiation, such as negotiating extra storage days.
- Gain real-time information on container status.
- Plan offloading schedules.
- Learn from data and optimize free time
How MercuryGate Controls Demurrage with Shipment and Order Visibility in Ocean Transportation
MercuryGate’s ClearTrack solution helps shippers manage demurrage and detention charges.
MercuryGate’s transportation management platform increases visibility into freight across the entire multimodal network. Shippers can use it to gain detailed information on ocean freight, from the vessel and container levels to the order and item levels.
This technology helps control these charges through features like:
- Visualizing the full shipment lifecycle.
- Collecting information from different parts of the supply chain and standardizing it to see the full picture.
- Sharing the location of ocean container shipments along with detailed information, including the current vessel location and the estimated time frame for arriving at the port.
Be Prepared for Charges in Customs and Ocean Freight
Learn more about MercuryGate’s visibility solutions and how they can help with demurrage and detention charges.
