Glossary Discription

Demurrage is a charge imposed when cargo, containers, or shipping equipment remains at a port, terminal, rail yard, or other transportation facility beyond the agreed-upon “free time” period specified in the shipping contract or tariff. This time-based fee serves as both a penalty for delayed cargo movement and an incentive to maintain efficient terminal operations and equipment utilization. Demurrage charges are typically calculated on a per-container or per-unit basis for each day (or sometimes hour) that the cargo exceeds the allotted free time, with rates often escalating the longer the delay persists.