Demurrage vs Detention: Charges, Free Time & Fixes
The exact line between demurrage and detention, how free-time clocks are counted, why the two often overlap, and the practical negotiation levers that cut both.
Demurrage and detention are the two carrier charges that turn a profitable shipment into a loss overnight. They sound similar and often get confused, but they cover completely different phases of a container's lifecycle and are billed under separate free-time clocks. This guide draws the line cleanly and explains the levers that actually cut the cost.
The definitions
- Demurrage - the charge for a full container sitting inside the port or terminal after free time expires. Meter starts on discharge, stops on gate-out.
- Detention - the charge for a container out of the terminal past its free time - either full in transit inland, or empty after unloading, before being returned to the carrier's empty depot.
Some ports and trade lanes combine the two into a "combined free time" of 10 to 14 days. Others meter them separately - 7 days demurrage and 5 days detention on the same shipment. Always read the B/L clause before the box lands.
Free time - how the clock is counted
Free time starts on discharge day - the day the container is landed from the vessel - and includes weekends and public holidays in most tariffs. Some carriers count business days only; a minority start the clock on the first working day after discharge. That difference alone can add 2 to 3 free days.
Detention free time typically starts on the same day - i.e. the two clocks run in parallel from discharge. Some contracts have detention start on gate-out from the terminal instead, which effectively extends the total free window.
Escalating tariffs
Neither charge is flat. A representative dry-container tariff for a mid-sized US or European port:
- Days 1-3 after free time: USD 75 per container per day
- Days 4-6: USD 150 per day
- Days 7+: USD 300 per day
Reefers usually run 2× to 4× these rates. Hazardous cargo, out-of-gauge and tank containers carry a further multiplier. Once a container passes 20 days it is not unusual for the cumulative charge to exceed the value of the box's contents.
The five practical levers
- Contract for more free time upfront. Regular shippers can negotiate 10 to 15 days on the master contract instead of the tariff default of 4 to 7.
- Pre-clear customs. File the entry before the vessel arrives so the container can move the day it lands - most demurrage comes from customs delay, not from transport delay.
- Use an inland ICD. ICDs typically have faster clearance windows and cheaper storage than seaport terminals - moving under Customs Bond to an ICD stops the port demurrage clock.
- Ask for a written extension. Carriers often grant 1 to 2 additional free days at a flat fee if you request it before free time expires. After expiry they almost never agree.
- Return empties to the nearest depot. Not the port. Empty return locations vary by carrier and week; the wrong depot adds 1 to 2 detention days easily.
Model your exposure
The Demurrage Calculator takes free days, tariff steps and expected delay and returns a per-day and cumulative exposure. For full-shipment landed cost including demurrage risk, feed the numbers into the Landed Cost Calculator.
Frequently asked questions
What is the difference between demurrage and detention?#
Demurrage is the charge for a full container sitting inside the port or terminal past its free time. Detention is the charge for a container out of the terminal (either full inland or empty after unloading) not returned to the carrier within its free time. Both are levied by the shipping line, but they cover different phases: demurrage = port, detention = inland.
How much free time do containers get before demurrage kicks in?#
Standard ocean carrier terms give 4 to 7 free days for demurrage (import) and 5 to 10 free days combined for detention. Free time varies by trade lane, port, container type and shipper contract. Reefers and special equipment typically get only 3 to 4 free days. NVOCC contracts often bundle free time differently - check the master B/L clause.
How are demurrage charges calculated?#
Per container per day, on a tiered scale that escalates: days 1-3 after free time might be USD 75/day, days 4-6 USD 150/day, day 7 onwards USD 300/day or more. Reefer rates are 2 to 4× dry-container rates. The carrier's published tariff (or the shipper's negotiated contract addendum) sets the exact numbers.
How can you reduce demurrage and detention?#
Negotiate extended free time in the carrier contract upfront (10 to 15 days is achievable for regular shippers), pre-arrange customs clearance so the container moves the day it lands, use an ICD with faster clearance windows, request an extension in writing before the free time expires (some carriers grant 1 to 2 additional days at flat fee), and return empty containers to the nearest empty depot rather than the port to save transit days.
Who pays demurrage and detention - buyer or seller?#
The Incoterm decides. Under EXW, FCA, FOB, CFR and CIF, the buyer takes over risk at or before shipment, so demurrage at destination and detention are the buyer's problem. Under DAP, DPU and DDP, the seller bears the destination costs including any demurrage until delivery is completed. In all cases the party on the carrier contract is legally liable to the line; whoever is not on the contract has to recover through the sales contract.