Whenever you ship a container with any carrier its crucial to know the basics of the terms used in shipping, such as Demurrage and Detention.
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Whenever you ship a container with any carrier its crucial to know the basics of the terms used in shipping, such as Demurrage and Detention.
So what does “Detention” mean in container shipping business?
Detention is the name of the charge which is applied by the carrier (shipping line) for using empty container more than allowed.
Detention can be considered as a rent fee for empty container. Detention can be applied in Export and Import.
Detention in Export is counted when container has been picked up by Merchant (Shipper) from named depot and ends when container is gated in full at the named terminal. Usually shipping lines give 5 to 14 days free detention. Its very important to pay attention when booking with shipping line, otherwise you may find out of pocket surprise like Detention invoice.
Example:
Shipping line gives you 5 days free detention in Export and you picked up container on 1.10.2015, then you moved container to Factory and it arrived 2.10.2015. Stuffing (Loading container with cargo) supposed to be arranged on 3.10.2015 and you expected to transfer container to Terminal on 4.10 – so there are no detention fees applicable. But! Due to some reason, cargo was missing some markering and labels arrived only 5.10 and cargo stuffed 5.10 Late PM. Container has been hauled to terminal on 6.10.6.10 – 1.10 = 6 days which means you have to pay Detention fee to shipping company for using container 1 day more compared to allowed. Detention fee differs a lot and depend on county, carrier, container type.. and can be from 5 to 200 USD (High detention is usually charged for Special equipment such as Reefer containers and Flat Racks) per day per container. You have to check this with Port of Loading Shipping Agency before in order to understand the risks.
Detention is applied only for EMPTY shipping line owned containers. No Detention should be applied for SOC (Shipper’s own containers).
Detention in Import is counted starting Gate out FULL – when you pick up container from terminal and ends when you return empty container back to shipping line depot. Usually shipping lines give 5 to 21 days free Detention in Import. For Special equipment such as reefers there could be 2 days or even 0 days free. Be careful with this. Always ask how many free days are granted for your shipment before making Booking with carriers.
Example:
Shipping line gives you 5 days free Detention at Destination port. Your cargo arrived on time and you picked up full container on 1.10.2015 and returned empty to named depot on 10.10.2015 due to long queue on the Russian border. Based on shipping line tariffs – Detention fee for 20 DRY is 50 USD/day, you have to pay 5 days * 50 USD = 250 USD extra for using equipment more than 5 days allowed.
Detention is applied only for EMPTY shipping line owned containers. No Detention should be applied for SOC (Shipper’s own containers).
I hope it is clear !
Good luck to you and check the terms and conditions before shipping!
Source: Shippingknowledge.com