- 19 November 2024
Navigating the world of international trade: How Demurrage, Detention and Storage impact your supply chain
In the world of international trade, the race is one of efficiency and precision. Container detention, demurrage and storage fees are the unexpected obstacles that can slow down your progress and inflate costs if not managed properly. Let’s investigate what these terms mean and how they can affect your business.
Understanding the Difference Between Demurrage and Detention
Demurrage
This is the free time allowed at the wharf to collect a full import container. If the container is not picked up within this free time, demurrage charges will start to accrue. These charges are typically calculated daily and can increase over time.
Wharf providers are allotted 3 days to collect import containers from the terminal after a vessel has docked and unloaded all containers at the terminal (DP World, Patricks, Hutchinson). If containers are not collected within this 3-day window, wharf cartage providers will incur wharf storage fees.
Shipping Line Detention
After a container is picked up from the port, there is a designated free time during which it must be unloaded and returned to the shipping line’s designated empty dehire location. This period varies based on the shipping line and the terms of the contract.
Shipping lines allow importers and exporters a specified number of days to unpack or pack containers. For import containers, this period typically ranges from 7, 10, 14, or 21 days. Importers can negotiate this timeframe through their freight forwarder or directly with the shipping line. While extending the free time often results in a higher freight rate, this cost is usually less than the potential detention fees charged by the shipping line.
When Does Shipping Line Detention Begin and End
The commencement of free time varies among shipping lines. Some begin the free time countdown when containers become available at the wharf, while others start it when the vessel docks at port. A container is considered de-hired once it is returned to the designated empty park specified on the import delivery order (the receipt document provided by the shipping line).
Ways in which Mainfreight can help reduce Demurrage, Detention and Storage Charges
1. Ensuring that your cargo is ready on time
Mainfreight provides a comprehensive supply chain solution for our customers. Our Air and Ocean division, along with our wharf cartage team, will work together seamlessly to ensure your container is picked up on time, accompanied by all the necessary paperwork, and transported and loaded efficiently. Mainfreight uses an in-house system shared across all our brands to track your freight throughout the entire supply chain journey.
2. Cross our T’s and Dot our I’s when it comes to customs clearance
Our team are experts in handling both imports and exports. We assist with customs brokerage, manage the necessary documentation for import clearance and ensure that all administrative tasks are completed by the time your container reaches its destination. By gathering and verifying all required documents, we help ensure that your container exits the terminal before the free demurrage period expires, thereby minimising storage fees.
3. Transparency
To ensure a seamless journey for your freight, Mainfreight is diligent in gathering accurate information and being transparent about fees related to demurrage, detention, storage and free time allocations. This commitment guarantees that there are no hidden costs and surprises.
4. Communication
Offering a complete supply chain solution enables us to provide the highest quality service at every milestone from origin to destination. Our in-house technology, developed with Mainfreight customers in mind, not only allows us to track your freight at every stage but also facilitates proactive communication and planning. This ensures your freight reaches its destination without delay.
Streamlined Service
Our national coverage ensures consistency of service and reduces associated administration costs when working with multiple wharf cartage providers.
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