Ask most shippers what their biggest logistics costs are, and you’ll hear the usual answers:
Very few will mention demurrage and detention—until finance flags an invoice that’s tens or hundreds of thousands of dollars over budget.
That’s because demurrage and detention don’t show up as planned costs. They show up as penalties. And by the time they appear, the damage is already done.
For global shippers, demurrage and detention are among the most preventable yet most misunderstood cost drivers in logistics. They quietly erode margins, distort landed cost calculations, and punish even small operational missteps.
In this guide, we’ll explain what demurrage and detention really are, why they’ve become so expensive, where most companies go wrong, and—most importantly—how shippers can reduce or eliminate these charges through better planning, visibility, and execution.
Demurrage is a fee charged by ocean carriers or terminal operators when a container remains at the port or terminal longer than the allowed free time after it becomes available.
In simple terms:
Demurrage charges are designed to:
For shippers, however, demurrage often feels like a punishment for circumstances outside their control.
Detention is a fee charged when a container is kept outside the terminal longer than the allowed free time after pickup.
This typically happens when:
Detention is meant to ensure carriers get their equipment back quickly—but in practice, it often reflects downstream inefficiencies rather than intentional delays.
Although they’re often grouped together, demurrage and detention apply at different stages.
| Charge Type | Where It Occurs | When It Starts |
|---|---|---|
| Demurrage | At port or terminal | After container availability |
| Detention | Outside the terminal | After container pickup |
Both charges can apply to the same container—and frequently do.
Demurrage and detention fees have existed for decades. What’s changed is how often they occur and how severe they’ve become.
Congestion used to be seasonal. Today, it’s persistent.
Congested ports mean:
Even when cargo is technically “available,” accessing it can be nearly impossible.
Carriers have reduced free time allowances in many ports.
What used to be:
This leaves little margin for error—especially when weekends, holidays, and customs inspections are involved.
Demurrage often turns into detention because:
One delay compounds into multiple charges.
Even minor paperwork errors can prevent timely release, triggering demurrage before the shipper can act.
Most companies only count the line-item charges.
That’s a mistake.
Daily charges add up fast:
Across dozens or hundreds of containers, costs snowball quickly.
To avoid escalating fees, companies often:
These costs are rarely captured as “demurrage,” but they’re part of the same problem.
When freight is delayed:
This ties up working capital and reduces agility.
Teams spend countless hours:
This hidden labor cost is rarely measured—but it’s real.
Understanding root causes is the first step toward prevention.
Many shippers don’t know:
By the time they find out, charges have already begun.
Demurrage is often locked in before the vessel arrives.
Common planning failures include:
If forwarders, truckers, warehouses, and customs brokers aren’t aligned, delays compound quickly.
Not every container deserves the same urgency.
Without prioritization, teams chase the wrong freight while high-risk containers accrue charges.
When something goes wrong, no one clearly owns:
Demurrage thrives in gray areas.
Demurrage is not a pricing problem—it’s an exception management failure.
Charges occur when:
That’s why companies with strong exception management see dramatically lower demurrage costs—even in congested environments.
The most effective companies don’t fight charges after the fact. They prevent them upstream.
Not all shipments carry equal risk.
High-risk indicators include:
These shipments should receive priority attention before arrival.
Customs delays are one of the fastest ways to burn free time.
Pre-clearance allows containers to move immediately upon availability.
Waiting until cargo arrives to book trucks is a recipe for fees.
Pre-booking:
Warehouses must be aligned on:
Detention often starts inside the warehouse—not on the road.
Free time is not a guideline—it’s a deadline.
Leading shippers treat it as a non-negotiable milestone and escalate early when risk appears.
This is where experienced forwarders create measurable value.
Forwarders coordinate:
This eliminates blind spots that cause delays.
Strong forwarders identify:
They act before free time starts ticking.
Instead of letting issues bounce between parties, forwarders take responsibility for:
Paperwork errors are one of the most preventable causes of demurrage.
Experienced teams catch issues early—before cargo is stuck.
Many companies assume they can dispute their way out of fees.
In reality:
Prevention is far more effective than recovery.
Technology plays an important role, but it’s not a silver bullet.
Technology enables awareness. People enable action.
Companies that actively manage demurrage often see improvements beyond cost savings.
Demurrage is a fee charged when containers remain at a port or terminal longer than the allowed free time after becoming available.
Detention is a fee charged when containers are kept outside the terminal longer than the allowed free time after pickup.
By improving visibility, pre-planning inland moves, prioritizing high-risk shipments, and managing exceptions proactively.
Rarely. Prevention is far more effective than disputing charges after they occur.
Responsibility depends on contract terms, but shippers ultimately bear the financial impact in most cases.
Demurrage and detention aren’t just annoying fees. They’re warning signs.
They indicate:
The companies that control demurrage don’t do it by fighting invoices—they do it by building disciplined, proactive logistics operations.