what is demurrage in shipping

Demurrage is a charge applied to containers that are left at the port or rail yard longer than their allotted free time. It is a fee attached to cargo that has overstayed its time at a terminal, and these fees can be enforced by port officials. The cost of demurrage charges varies depending on carriers, terminals, and contractual agreements, but they tend to be anywhere between $75 to $300 per container per day. The causes of demurrage can be due to a variety of reasons, some in the control of the shipper and others not. The typical timeframe to load or unload a chartered ship is three days, and demurrage is charged when a company delivering containers does not unload or move them expeditiously.