Demurrage

Demurrage is a financial penalty assessed by shipping lines and port authorities to discourage shippers from using marine container yards as long-term storage facilities. It accrues while the loaded container is physically located inside the port terminal boundary after vessel discharge.

Demurrage rates follow a staircase structure: once the initial free time (e.g., 4 to 7 calendar days) expires, tier 1 rates apply for the first few days, followed by sharply higher tier 2 and tier 3 rates if the container remains uncollected.

Common causes of demurrage include unpaid ocean freight holds, missing original bills of lading, customs inspection holds, terminal appointment congestion, and trucking chassis shortages.