Demurrage is a term that has different meanings depending on the context. Here are the different meanings of demurrage:
In commercial ship chartering, demurrage is an ancillary cost that represents liquidated damages for delays. It occurs when the vessel is prevented from loading or discharging cargo within the stipulated laytime. Laytime is the term used to quantify the time allowed within which an operation is allowed to be made.
In the oil industry, demurrage refers to the excess time taken to discharge or load, as the case may be, in excess of the allowed laytime.
In business, demurrage is a delay in delivery of a product via delivery truck. When a delay occurs with product delivery, the delivery party can elect to claim a no-fault delay by submitting a demurrage charge.
In international maritime shipping, demurrage is a penalty fee paid by a charter company for failing to load or unload a vessel within the timeframe set out in its contract. The fee is charged per container per day until the container is picked up. The cost of demurrage charges varies depending on carriers, terminals, and contractual agreements. However, they tend to be anywhere between $75 to $300 per container per day. After several days, the charges can grow to more significant amounts.
