Demurrage, detention, and per diem are often used synonymously, but they’re not the same. Importers and exporters must know the difference between these fees to understand their port billing statements. It’s also beneficial to find the right freight specialists to minimize the overall cost of shipping. This guide explains why these fees appear on your billing statement and how to avoid them.

Demurrage Fees

After being placed at the port, containers are allowed to sit for a certain number of days. If the container hasn’t been cleared through customs or emptied within the free time, then a daily charge is accrued, which is known as a demurrage fee.

This daily charge is different at each port and increases after a set number of days. For example, a container sitting for three days may be charged $100 per day, but on the fourth day the daily charge may go up to $150, and on the seventh day it may rise to $200 per day. All demurrage fees must be paid before retrieving the container. This charge is an incentive to move containers quickly, so open spaces are available for arriving shipments.

Avoid demurrage fees by working with a quality freight specialist. They will help with pre-planning to make sure your container is emptied or moved quickly, and help you avoid extra charges. They will also pre-pull your cargo and move it to their warehouse. If you want the full container moved out of port, then you may incur detention fees.

Detention Fees

Detention fees are charged when the consignee holds the carrier’s container outside of the port. Much like demurrage, the consignee is charged per day, or per diem, after the allowed free time. This equipment charge encourages recirculation of the containers.

Driver detention is an hourly fee for delaying truck drivers. Drivers have limited time per day to drive and must rest for ten hours before driving again. The trucking industry can lose over $1 billion per year from delayed drivers.

Work with your freight specialist ahead of time to avoid detention fees. Prepare pickup and unloading times before shipment arrivals, have an on-call driver on standby, and negotiate longer unloading times with your truck carrier.

If you’re looking for the most efficient and reliable freight specialists, reach out to the professionals at MFS Freight Service LLC. With over 50 years of experience and agents in Honolulu, Oakland, and Los Angeles, they provide shipping, delivery, and storage options. Their fleet of trucks, warehouses, and shipping terminals are conveniently located, and their logistical experts work around the clock. Visit their website to learn more about their shipping options, and call (808) 847-3015 to schedule a shipment.