Detention vs Demurrage: The Complete Guide to Understanding Shipping Charges and Avoiding Costly Penalties
Detention and demurrage are also an important source of cost in international shipping and need a lot of management and knowledge. Demurrage is charged on containers that are left at terminals after the free time has expired whereas the container detention and demurrage fees are charged on containers that are left outside terminals. The two charges have varied ways of calculation and pose various unique challenges to the supply chain management.
Effective management must be practiced as it involves planning, documentation, and technology and good relations with partners which provide the service. Firms which take the effort to study and negotiate these charges reap huge savings in costs and increase efficiency. As shipping businesses are constantly developing, it is of great importance to be updated about any new steps and practices in order to remain competitive in the field of worldwide trade activities.