Short answer
Demurrage is a charge for holding a carrier’s equipment or a terminal’s space past the free time allowed. In ocean shipping it usually applies to a loaded container sitting at the port after its last free day. Railroads charge demurrage when shippers keep rail cars too long. Charges run per day and often climb the longer the delay lasts.
How demurrage works
Every container or rail car comes with free time. When it runs out, the clock starts.
- Ocean containers. The terminal and ocean carrier set free days after the container is discharged. If the container isn’t picked up by the last free day, demurrage accrues daily, often in tiers that rise over time. The Federal Maritime Commission’s rule defines demurrage and detention as charges for the use of marine terminal space or shipping containers, including per diem, excluding freight charges.
- Rail cars. Under 49 CFR Part 1333, a party that receives rail cars for loading or unloading and holds them past free time can be liable for demurrage, if the railroad gave notice of its demurrage tariff first.
Common causes: customs holds, unpaid freight, no terminal appointments, no chassis, or a receiver that can’t take the freight yet.
Demurrage vs detention
These two get mixed up constantly, partly because the meaning shifts between ocean freight and trucking.
| Demurrage | Detention | |
|---|---|---|
| Ocean freight | Loaded container held inside the terminal past free time | Container kept outside the terminal past free time, often called per diem |
| Rail | Rail car held past free time for loading or unloading | Not the usual rail term |
| Trucking | Rarely used | Pay for a truck held at a shipper or receiver past the free time on the rate con |
| Who bills | Terminal or ocean carrier, or the railroad | Ocean carrier for containers, carrier or broker for truck time |
| How to avoid it | Pick up before the last free day | Return empties on time, keep dock appointments |
In a brokerage, “detention” almost always means the trucking kind: the driver waited too long at the dock. See detention for how that’s billed, and accessorial charges for the broader list.
Example: a container that sat too long
Example, with illustrative numbers. An import container’s last free day is Tuesday. Terminal appointments are full, and the drayage carrier pulls it Friday, three days late.
- Terminal demurrage: 3 days at $150 = $450
- Chassis: 4 days at $40 = $160
- The receiver holds the container two days past the ocean carrier’s free time outside the terminal: 2 days of detention at $125 = $250
That’s $860 on top of the dray rate. Whether the importer, the forwarder, or the trucker pays depends on who contracted for what, and it’s worth settling before the container lands.
Rules on demurrage billing
The FMC’s demurrage and detention billing rule took effect for most provisions on May 28, 2024. Under 46 CFR Part 541, a billing party must issue the invoice within 30 calendar days of when the charge was last incurred. The billed party gets at least 30 days to request mitigation, refund, or waiver, and the billing party must try to resolve it within 30 days.
The rule originally limited who could be billed. In September 2025 the D.C. Circuit set that section aside, and the FMC removed 46 CFR 541.4 in December 2025. The other requirements still apply.
Common mistakes
- Treating the terminal’s last free day and the ocean carrier’s container free time as one date.
- Paying an invoice without checking that it arrived within the 30-day billing window.
- Quoting a door move without saying who pays demurrage if the receiver isn’t ready.
- Waiting to dispute a charge until the request window has closed.