Demurrage vs. Detention Charges: What You Need To Know

Importers, exporters, freight forwarders, and other parties hear the terms “demurrage and detention”. There is usually confusion between these terms. However, they are important terms and usually lead to the abandoning of container ship cargoes if the charges are not fully expected. So whether you are shipping from Kuwait to UK or anywhere else, it’s important to understand demurrage vs. detention charges. Keep reading to find out more.

Demurrage vs. detention charges

The terms demurrage vs. detention charges is used a lot in container shipping. Demurrage means that the merchant needs to pay for the use of the container. They will need to do it within the terminal after the free time period. On the other hand, detention is a charge that the merchant needs to pay for the use of the container outside of the depot or terminal after the free time period.

demurrage vs detention containers
Demurrage and detention charges are common terms in container shipping.

If the buyer expects a delay, they will need to specify to the shipping line whether they want to be charged demurrage or detention. The reason for this is that the shipping time needs to manage the flow of goods. Also, some shipping lines may combine detention and demurrage and refer to them as free days. The definitions of demurrage and detention will depend on the shipping line. So be sure to research that as well. But before you search for movers and packers Kuwait, read on to learn more about demurrage vs. detention charges.

For imports

So let’s say that you sent containers with freight forwarding companies in Kuwait and those containers need to arrive at a terminal or a buyer. Demurrage might happen if the containers don’t get picked up after they have arrived at the port. From midnight on the discharge day, after the expiration of the free period, port authorities will fine you on a per-day basis. This usually costs anywhere between 50 and 200 dollars per container.

So let’s say you take away containers to unload them with the intention of returning them to the port. And then, a delay occurs. The authorities will charge you with detention. Also, an importer may get charges for both detention and demurrage.

For exports

If you are exporting goods with the help of sea freight companies in Kuwait, the port authorities may give you 7 – 10 free days. During these days, you will have to pick up empty containers from their port. After that, you will need to load them with goods and give the port full containers for dispatch. However, if you don’t do this in 10 days, you will be charged for detention for every additional day’s delay.

areal shot of cargo ship on sea
If you don’t pick up empty containers from the port to load them for dispatch, you’ll be charged for detention for every additional day’s delay.

If the exporter delivers goods before the agreed dispatched date (when the ship arrives), demurrage will be charged. For example, if the ship needs to arrive on 15th May, and there are 7 free days before demurrage is charged, if the exporter does deliver goods on the 5th May, they’ll be charged 2 days worth of demurrage fees.