Meaning of Container Free Demurrage and Free Storage
When the container volume is large or the destination is far from the port of discharge, customers usually request a sufficiently long free demurrage and free detention period when booking space. It is common knowledge that obtaining free demurrage is relatively easy, while free detention is more difficult. What exactly is the difference? Below is an explanation for everyone.
DEMURRAGE: Refers to the charge for overdue (extended) use of a container while it is under the control of the carrier or its agent, usually referring to the container overdue charge incurred at the destination terminal or depot before the consignee clears customs and takes delivery.
DETENTION: Refers to the charge for overdue (extended) use of a container while it is under the control of the consignee, i.e., incurred when the consignee takes the container out of the depot or terminal after customs clearance but fails to return the empty container within the specified time.
Free Demurrage & Free Detention both refer to container detention charges. The difference between the two is:
Free Demurrage: Calculated from the time the container is discharged at the terminal until the container is taken out of the terminal;
Free Detention: Calculated from the time the container is taken out of the terminal until the empty container is returned to the terminal; Additionally, there is Free Storage: This is the terminal storage charge, calculated from the time the container is discharged at the terminal until the container is picked up. Free Demurrage & Detention are container detention charges collected by the shipping line, typically around 7 days. Some ports, due to transshipment or other reasons, allow applications for 10-14 days, and longer periods of up to 21 days; Free Storage, on the other hand, is the storage charge collected by the terminal, usually 5-7 days, and is generally more difficult to apply for.
Differences Among FREE TIME, FREE DEMURRAGE, and FREE DETENTION After research and analysis, the following accurate reference has been selected:
1. Free period for containers within the terminal after cargo arrival: Free Demurrage;
2. Free period for containers stored outside the terminal after cargo arrival: Free Detention;
3. Free storage period for containers in the terminal: Free Storage.
Items 1 and 2 are determined by the shipping line and can therefore be applied for with the shipping line. Generally, the applied and approved Free Time = Free Demurrage + Free Detention. Under normal circumstances, the Free Time at the destination port is 7 days. Shipping lines usually approve applications for 14 days; 21 days is more difficult unless it is a stable customer or the shipping line has an excess of containers at the port.
Many people do not understand the difference between Demurrage and Detention. Storage, on the other hand, is the container storage charge collected by the terminal from the shipping line. The Free Storage time depends on the terminal, not the shipping line. D&D (Demurrage & Detention) container detention charges, the related term is Free Time (free period). The Demurrage free period begins on the date of cargo arrival at the destination. The Detention free period begins on the date the consignee picks up the loaded container. If the consignee has not yet picked up the cargo after the respective free period expires, Demurrage shall be paid according to the shipping line's regulations; If the consignee has not yet returned the empty container after the respective free period expires, Detention shall be paid according to the shipping line's regulations. Whether Demurrage free 7 days is sufficient mainly depends on the speed of the import customs clearance procedures; whether Detention free 7 days is sufficient mainly depends on how quickly the loaded container is stripped and returned empty.
Zhuhai Bofeng Logistics National Service Hotline: 13075678958 Manager Huang
Bofeng Logistics specializes in providing one-stop logistics services including domestic container shipping, international shipping (FCL/LCL), Hong Kong and Macau logistics dedicated lines, as well as trucking, customs declaration, and warehousing. Contact number: 130-7567-8958 (Manager Huang), call now for a customized quote!
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