Differences Between Demurrage, Detention, and Storage
Interlink編集部Differences Between Demurrage, Detention, and Storage
The differences between Demurrage, Detention, and Storage are based on the costs related to storage, detention, and late return of import and export cargo, categorized by location of occurrence, subject objects, FCL/LCL, and Free Time relationships.
Although all three are often understood as "charges incurred when cargo or containers remain longer than scheduled," in actual logistics practice they are not the same charges. Demurrage mainly arises when a container remains at the terminal or inside the CY, whereas Detention becomes an issue after the container is taken out of the terminal and the empty container return is delayed. Storage refers to the storage fees incurred when cargo or containers are stored at terminals, CYs, CFS, warehouses, etc.
If these three are treated indistinguishably as just "storage fees," it becomes difficult to clarify whom to verify the charges with, when the free period ends, whether it concerns FCL or LCL, and who is responsible for the cost. Therefore, it is important not to judge just by the name but to confirm "where," "what," "since when," and "under whose control" the detention is occurring.
Scope Covered in This Article
| Item | Content Covered in This Article | Contents Covered in Other Articles in Detail |
|---|---|---|
| Demurrage | This article organizes the concept mainly for import FCL, when containers remain inside the CY or terminal beyond the free time. | Carrier-specific rates, detailed billing breakdowns, and individual route Free Time conditions require separate confirmation. |
| Detention | This article describes the concept mainly for import FCL when the return of empty containers is delayed after being taken out of the terminal. | Arrangements for drayage, empty container return bookings, and details of container return locations require separate confirmation. |
| Storage | This article organizes Storage as fees for storing cargo or containers at CYs, CFSs, warehouses, etc. | CFS charges, warehouse storage fees, and special cargo storage conditions need individual facility-specific confirmation. |
| Differences Between FCL and LCL | This article clarifies that for FCL, costs are visible on a container basis, and for LCL on a cargo basis. | Differences between FCL and LCL rates, import consolidation CFS storage fees, and import consolidation outbound booking can be addressed as separate themes. |
| Cost Burden | This article covers points to check for organizing the causes of cost occurrence. | Final identification of the responsible party, contract interpretation, and the possibility of damage claims require individual judgment based on contracts, transport terms, invoices, and communication records. |
General Overview
Demurrage, Detention, and Storage can be more easily understood when organized as follows:
- Demurrage: Excess charges mainly when containers stay too long inside the terminal or CY
- Detention: Excess charges mainly when empty container return is delayed after being taken outside the terminal
- Storage: Charges for storing cargo or containers at terminals, CYs, CFSs, warehouses, etc.
However, actual definitions and applications may vary depending on the carrier, terminal, CFS, port, country, and contract terms. Especially abroad, the term "Demurrage" may refer to a different scope than the practical sense in Japan. Therefore, it is necessary not to rely solely on the invoice line items but to verify the location of occurrence, what is being charged, Free Time start date, and the invoicing party.
Comparison of Demurrage, Detention, and Storage
| Item | Main Location of Occurrence | Main Subject | Transport Mode Where Common | Relation to Free Time | Practical Perspective |
|---|---|---|---|---|---|
| Demurrage | Port terminal, CY | Mainly loaded containers | Commonly an issue in import FCL | Likely incurred when exceeding the free period inside the CY | Whether the container has been moved out of the CY is important. |
| Detention | Outside terminal, shipper’s warehouse, delivery location, locations waiting for return | Mainly the container itself | Commonly an issue in import FCL | Likely incurred when exceeding the return grace period after pickup | Whether the empty container is returned to the designated place within the deadline is important. |
| Storage | CY, CFS, terminal, warehouse | Container or cargo | Can be an issue in both FCL and LCL | Likely incurred when exceeding the facility’s free storage period | It is necessary to confirm at which facility and for what the fees are charged. |
What is Demurrage?
Demurrage generally refers to charges incurred when import containers remain at the port terminal or inside the CY beyond the free time. In Japanese, it may be called "demareji," excess storage fees, or container detention charges.
In import FCL, after containers are discharged from the vessel, they must be moved out from the CY within a certain period. If import clearance, D/O procedures, drayage arrangements, or outbound reservations are delayed, containers may remain in the CY and incur Demurrage charges.
What is important in Demurrage is not simply the fact that "cargo has not been picked up." It needs to be confirmed whether the container is still inside the terminal, whether moving out from the CY is possible, and what is causing the delay. Even if import clearance is granted, if the D/O is not issued, the container may be unable to move out. Conversely, even if the D/O is issued, the container cannot be moved out if drayage or outbound slots are not secured.
What is Detention?
Detention generally refers to charges incurred when empty containers are returned late beyond the free time after being taken outside the terminal. In Japanese, this may be called "ditenshon" or container return delay charges.
In import FCL, loaded containers are taken out from the CY, unpacked at the shipper’s warehouse or delivery location, and then empty containers are returned to the specified return locations. If the return is delayed past the specified deadline, Detention charges may occur.
What is important about Detention is that even after the container has left the terminal, it is still considered under the management of the shipping line or container owner. Containers are not simply packing materials; they are transportation equipment with a return deadline. If unloading at the delivery point is delayed, a return reservation cannot be secured, or the container cannot be returned due to holidays or port congestion, charges may occur once the deadline passes.
What is Storage
Storage refers to charges incurred for storing cargo or containers at terminals, CYs, CFSs, warehouses, and so forth. In Japanese, these are commonly referred to as storage fees or charges.
Storage fees commonly arise at the container level for FCL shipments, and at the cargo level for goods stored at a CFS in LCL shipments. Particularly with imported LCL, since the cargo owner does not take direct delivery of a full container, storage charges inside the CFS are often more visible and recognizable than Demurrage or Detention fees.
Storage is often treated as a fee for the facility storing the cargo or container rather than a cost related directly to the shipping line’s container usage conditions. However, the invoicing party and naming can vary by company, port, and facility, so in actual logistics practice, it is necessary to check not only the item name on the invoice but also the related cargo, applicable period, and storage location.
Differences in FCL
For FCL, Demurrage, Detention, and Storage are all charges that tend to be assessed on a container basis. The timing of when the container is removed from the CY, when it is unpacked, and when the empty container is returned is extremely important.
- Demurrage: When the container remains in the CY beyond the free period without removal
- Detention: When the empty container return is delayed after removal
- Storage: When storage charges arise for keeping containers or cargo at the CY or terminal
With FCL, customs clearance, D/O issuance, fee settlement, drayage, acceptance at the delivery location, unpacking, and empty container return form a continuous flow. If any of these steps are delayed, there is potential for Demurrage, Detention, or Storage charges. This is especially true before holidays, year-end periods, during port congestion, after typhoons, or post customs inspection when deadline management becomes more challenging than usual.
Differences in LCL
In LCL shipments, the cargo owner does not manage the entire container directly. The NVOCC or consolidation operator arranges the container, and at the destination, the container is unpacked in the CFS and cargo is sorted by shipper.
Therefore, the issue for shippers in LCL is less about container-level Demurrage or Detention like FCL and more about storage fees for cargo inside the CFS. If Arrival Notices are not checked, D/O issuing parties not identified, CFS charges not settled, import permits delayed, or pick-up reservations and delivery arrangements are postponed, cargo may remain in the CFS, causing Storage Charges or CFS storage fees to accrue.
- FCL: Container-level Demurrage and Detention are key fees
- LCL: CFS storage fees and Storage Charges are key fees
In LCL, not only the date the container arrives at the port but also when it is unpacked at the CFS and when the cargo becomes available for pick-up are important. Proceeding without checking the free storage period and pick-up availability date may lead to accumulating storage charges before realizing it.
Relationship with Free Time
Understanding Demurrage, Detention, and Storage requires careful confirmation of Free Time. Free Time refers to a free period during which containers or cargo can be held without incurring additional charges.
However, even though the term Free Time is used, it is necessary to differentiate what free period applies to what. The free time inside the CY, the grace period after container removal for return, and the free storage period inside the CFS for cargo are not the same.
| Type of Free Time | Main Subject | Related Charges | Points to Confirm |
|---|---|---|---|
| Free Time inside CY | Full containers | Demurrage, Storage | Start date, number of free days, treatment of weekends/holidays, final removal deadline |
| Free Time after removal | Container return | Detention | Removal date, return deadline, return location, need for return reservation |
| Free Time inside CFS | LCL cargo | CFS storage fee, Storage Charge | Unpacking date, pick-up availability date, free storage period, CFS business hours |
Common Practical Issues
| Case | Common Issues | Documents to Check | Practical Notes |
|---|---|---|---|
| D/O procedure delayed in import FCL | Even if import clearance is granted, D/O may not be completed, preventing CY pick-up. | Arrival Notice, D/O notification, cost settlement records, shipping line or NVOCC notices | Confirm early not only customs clearance but also the D/O issuing party and settlement status. |
| Delay in CY pick-up due to customs inspection | Targeted inspection may make it difficult to pick up within free time. | Customs inspection notice, customs clearance status, earliest pick-up date, free time terms | Costs may not automatically be waived due to inspection delays, so early confirmation is necessary. |
| Unable to secure pick-up slots due to post-typhoon port congestion | Port congestion may prevent CY pick-up booking or drayage arrangements, causing demurrage. | Pick-up booking records, communication with drayage contractors, port congestion info, free time terms | Make pick-up reservations earlier than usual during congestion, and consider alternate vessels or schedules. |
| Delay in devanning operations at delivery site | Although container is picked up, delayed empty container return could cause detention charges. | Delivery appointment, devanning records, empty container return deadlines, return booking records | Confirm delivery site’s operational capacity, reception hours, and cargo handling conditions in advance. |
| Unable to secure empty container return booking | Even if devanning is complete, lack of return slots may result in detention charges. | Return location details, return booking records, communication with drayage contractors | Check return locations, reception hours, and whether booking is required well before pick-up. |
| Unknown D/O issuer in LCL shipment | Multiple parties such as NVOCC, co-loaders, and Japanese agents may delay D/O processing. | Arrival Notice, B/L, House B/L, invoice, agency information | Check not only the issuer of the Arrival Notice but also the actual party issuing the D/O. |
| Unable to secure CFS pick-up booking in LCL | Even after import clearance, inability to book CFS pick-up may incur storage charges. | CFS pick-up notification, pick-up booking records, CFS operating hours, cargo availability date | Confirm CFS reception hours, vehicle requirements, and cargo handling conditions early. |
| Delayed cost settlement before holidays | Failure to settle fees like D/O Fees, CFS Charges, THC, etc. may block pick-up. | Invoices, payment records, release notices, pick-up approval communications | Due to possible bank processing delays before holidays, settle costs as early as possible. |
Differences Between Demurrage and Storage
Demurrage and Storage are both costs related to cargo or containers remaining at terminals or CYs, so they are often confused. However, in practical logistics, they may apply to different targets.
Demurrage is often treated as an overage charge based on the shipping line’s or container usage terms, focusing on containers not picked up within the prescribed period. Storage, on the other hand, is considered a cost focusing on the storage of cargo or containers at facilities such as terminals, CYs, CFSs, or warehouses.
This distinction matters because the parties to check and negotiate with may vary. For Demurrage, it is necessary to confirm the guidance and terms from the shipping line, NVOCC, or freight forwarder, while Storage requires checking the facility terms from terminals, CFS, warehouses, etc. It is important to separately confirm who is billing, which period the fees cover, and which cargo or containers the charges relate to.
Differences Between Demurrage and Detention
The difference between Demurrage and Detention becomes easier to understand by considering where the container is located.
- Demurrage: The container remains inside the terminal or CY
- Detention: After the container has been removed from the terminal
In import FCL, Demurrage issues arise first when pick-up from the CY is delayed, and Detention issues arise if empty container return is delayed after pick-up. That is, even for the same container, the nature of the costs differs before and after CY pick-up.
Mistaking this distinction can lead to incorrect analysis of the cause of charges. For example, delays in CY pick-up due to customs document issues tend to cause Demurrage concerns, while delays in returning empty containers due to slow unloading at the delivery site tend to cause Detention concerns. When considering cost responsibility, it is necessary to organize the delays chronologically.
Why Detention Is Less Visible in LCL
In LCL, the cargo owner does not take direct delivery or return of an entire container. Mixed containers are delivered to CFS by NVOCCs or consolidators and then devanned at the CFS before cargo units are handed over to shippers.
Therefore, Detention as seen in FCL is less apparent to LCL shippers. Instead, charges such as CFS storage fees, Storage Charges, and delayed pick-up fees tend to be problematic. In practice, for LCL, the key points to confirm are cargo availability date at the CFS, free storage period, pick-up bookings, and settlement of CFS charges rather than container return deadlines.
Import Clearance Alone Does Not Prevent Delays
Demurrage, Detention, and Storage are not necessarily avoided by import clearance alone. Even if import clearance is granted, if the D/O procedure is incomplete, cargo cannot be picked up. For FCL, if drayage is not arranged, pick-up from the CY is impossible. For LCL, if CFS pick-up bookings are not secured, cargo cannot be collected.
In import logistics, customs clearance, D/O, cost settlement, pick-up bookings, and delivery arrangements must all proceed concurrently. Completing customs clearance alone will not move cargo if other steps are delayed. Especially before holidays or during peak seasons, the clearance granted on documents may not coincide with the actual available pick-up date.
Relationship with D/O Procedures
If the D/O procedure is delayed, in FCL cases the container cannot be moved out from the CY, and in LCL cases the cargo cannot be picked up from the CFS. The D/O is a practically important procedure for cargo delivery and should be confirmed separately from import clearance.
Especially with import LCL, multiple parties such as NVOCC, co-loader, and Japanese agents may be involved. Therefore, simply receiving the Arrival Notice may not make it clear from whom the D/O should be obtained. Early confirmation of the issuer of the Arrival Notice, the issuer of the D/O, the invoice issuer, and the receiving CFS is important to avoid CFS storage charges.
Relationship with Pickup Reservation
Whether FCL or LCL, failure to secure a pickup reservation could result in additional charges. For FCL, securing drayage companies, container pickup slots, and empty container return slots is critical. For LCL, it is necessary to check the CFS pickup reservation, reception hours, vehicle conditions, and cargo handling conditions.
Before holidays, year-end and New Year holidays, port congestion, or after typhoons, it can be difficult to secure pickup reservations and the cargo may not be moved out within the free time. In particular, depending on whether the cause of the inability to pick up is facility congestion, delay in instructions from the shipper’s side, or delay in forwarding guidance, the allocation of costs in the future could differ.
Reasons Why Cost Allocation is Often Contested
Demurrage, Detention, and Storage fees are frequently disputed in terms of cost responsibility. The reason is that the mere fact of incurring charges does not clarify whose responsibility caused them.
Depending on whether the cause is late document submission by the shipper, delayed guidance by the freight forwarder, congestion on the shipping line or CFS side, customs inspection, or delivery destination circumstances, the arrangement of cost responsibility may vary. Additionally, whether the Free Time was clearly communicated, who knew the pickup eligibility date, and whether warnings or notices were given before charges were incurred are also important.
Therefore, it is important to keep records of charge incurrence dates, free time, reasons for delay, communication history between involved parties, customs clearance status, D/O processing status, and pickup reservation status. Without emails, invoices, or reservation records, it becomes difficult to clarify responsibility later when trying to verify why charges occurred.
Relationship with Marine Cargo Insurance
Demurrage, Detention, and Storage fees differ from damage or wetness to the cargo itself. Therefore, they may not be automatically covered under marine cargo insurance.
Even if inspections or pickups are delayed due to cargo incidents, how storage fees or excess charges are treated depends on the insurance terms, accident cause, damage mitigation measures, and timing of notification to the insurer. When an accident occurs, it is necessary to consult the insurance company or agent early, not only to verify cargo damage but also to prevent continued accumulation of storage or detention fees.
In insurance claims, besides the Demurrage, Detention, or Storage invoices, documentation explaining the accident date, cause, inspection instructions, reasons for inability to move out, and necessity for continued storage may be required.
Checklist for Confirmation
| Confirmation Timing | Party to Confirm With | Items to Confirm | Action If There Are Problems |
|---|---|---|---|
| Before Vessel Arrival | Shipping Line, NVOCC, Freight Forwarder | ETA, Free Time, D/O Procedure, Cost Settlement Method | Prepare necessary documents and fees before arrival, and pre-check items that might be delayed. |
| Before Import Customs Clearance | Customs Broker, Shipper, Freight Forwarder | Customs Documents, Import Clearance Expectation, Customs Inspection Presence | If documents are insufficient or inspections expected, check the impact on Free Time. |
| At D/O Procedure | D/O Issuer, NVOCC, Agent | D/O Issuance Conditions, Invoice Amount, Payment Confirmation, Release Eligibility | If the D/O issuer is unknown, identify stakeholders using Arrival Notice and B/L. |
| At FCL Pickup Arrangement | Drayage Company, CY, Freight Forwarder | Pickup Reservation, Available Pickup Dates, Pickup Deadline (not CY cut-off), Vehicle Arrangement | If pickup slots are unavailable, check alternative dates, alternative companies, and when charges start. |
| After FCL Delivery | Delivery Destination, Drayage Company, Return Location | Estimated Unloading Completion, Empty Container Return Deadline, Return Reservation, Return Location | If unloading delays are expected, check return deadlines and Detention charge start dates. |
| At LCL Pickup Arrangement | CFS, Customs Broker, Freight Forwarder | Unloading Date, Pick-up Eligibility Date, CFS Free Storage Period, Pickup Reservation | If pickup reservations cannot be made, confirm storage fee start dates and alternative delivery methods. |
| When Receiving Cost Invoices | Invoice Issuer, Freight Forwarder, Related Parties | Cost Items, Applicable Period, Relevant Containers or Cargo, Reason for Incurrence | Do not judge based solely on invoices; cross-check timelines and communication records. |
| When Considering Cost Responsibility | Shipper, Freight Forwarder, Customs Broker, Delivery Service | Delay Causes, Instruction Dates, Communication History, Reservation Records, Contract Terms | Avoid quick judgments on responsibility; organize by cause and discuss collaboratively. |
Scope of Freight Forwarder's Involvement
| Scenario | What can be supported | What should not be concluded definitively | Practical points to note |
|---|---|---|---|
| Confirmation of Free Time | Provide information on Free Time obtained from shipping lines, NVOCCs, and CFS | Conclude that all charges are definitely waived | Clarify the start date of Free Time, treatment of weekends and holidays, and whether extensions are possible. |
| Confirmation of Demurrage | Check CY delivery deadline, occurrence date, billing party, and the relevant container | Decide the charge is borne by the shipper or forwarder without verifying the cause | Organize the timeline including customs clearance, D/O, delivery reservation, and port congestion. |
| Confirmation of Detention | Check the empty container return deadline, return location, and return reservation status | Judge all delays caused by delivery destinations or drayage operators as exempt | Record the devanning completion time, return reservation, and reasons for inability to return. |
| Confirmation of Storage | Check storage period, rates, and earliest pick-up dates at CFS or warehouses | Explain that Storage is always the same type of charge as Demurrage | Delineate whether the charge is a facility storage fee or related to container usage conditions. |
| Discussion on cost burden | Support collecting relevant documents and organizing the cause | Conclude legal responsibility without reviewing contracts or terms | Decide cost burden based on contract terms, communication history, and cause of delay. |
| When insurance incidents are involved | Prompt early contact with insurance companies or agents | Explain that storage or excess charges will definitely be covered by insurance | Separate cargo damage and incidental costs, and confirm insurance policy conditions. |
Items to Check for FCL
When confirming Demurrage, Detention, and Storage for FCL, organize the following items:
- Vessel arrival date
- Offloading date
- Start date of Free Time
- CY delivery deadline
- Demurrage occurrence date
- Drayage arrangement date
- Devanning scheduled date
- Empty container return deadline
- Detention occurrence date
- Conditions triggering Storage
For FCL, the charges to check differ before and after delivery from the container yard. Before CY delivery, Demurrage and Storage are central; after delivery, Detention is the focus. Tracking the container's location in chronological order is fundamental to confirming charges.
Items to Check for LCL
When confirming CFS storage fees or Storage for LCL, organize the following items:
- Issuer of Arrival Notice
- CFS where cargo was delivered
- Devanning scheduled date
- Earliest pick-up date
- CFS free storage period
- CFS storage fee accrual date
- Issuer of D/O
- Status of CFS charge settlement
- Import permit date
- Delivery reservation date
For LCL, management should be focused on cargo units rather than containers. After cargo becomes available for pick-up at the CFS and the free storage period expires, storage fees may be incurred. It is necessary to confirm not only import permits but also that D/O issuance, cost settlement, and delivery reservations are completed.
Common Misunderstandings
| Common Misunderstandings | The Actual Viewpoint | Practical Points to Note |
|---|---|---|
| Demurrage, Detention, and Storage are all the same type of storage fees | They may differ in location of occurrence, subject matter, billing party, and the nature of the cost. | Check not only the item name on the invoice but also where and on what the charge is based. |
| No additional charges will occur once the import permit is issued | Even after import permits, cargo cannot be delivered unless D/O, charge settlement, delivery reservation, and transportation arrangements are completed. | Manage customs clearance and delivery arrangements as separate processes. |
| Detention can be handled the same for both FCL and LCL | Empty container return is important for FCL, while CFS storage fees tend to be the focus for LCL. | Organize information by container units for FCL and by cargo units for LCL. |
| Only confirm Storage with the shipping line | Storage fees can be generated by terminals, CFS, warehouses, or other facility operators. | Confirm the billing party and storage location, and check CFS or warehouse conditions as needed. |
| Port congestion or public holidays automatically waive charges | Congestion or holidays do not necessarily guarantee automatic waivers or reductions of charges. | Confirm whether waivers or reductions apply according to shipping lines, facilities, and contract terms. |
| If a freight forwarder is involved, charges always fall on the forwarder | Cost burden depends on cause of delay, timing of instructions, contract terms, and communication history. | Organize chronologically who did what, when. |
| Marine cargo insurance obviously covers storage and excess charges | Marine cargo insurance mainly covers cargo damage; incidental charges are not necessarily covered. | If an incident is involved, confirm early with the insurance company or agent. |
Practical Notes
Demurrage, Detention, and Storage tend to be significant costs in import operations. For FCL, managing deadlines for CY delivery and empty container return is crucial. For LCL, it is important to confirm Arrival Notices, D/O, CFS devanning, earliest pick-up dates, delivery reservations, and CFS storage fees.
When reviewing these charges, it is essential to separate "where the charge is incurred," "on what the charge is incurred," "whether it is FCL or LCL," and "until when free periods apply." Judging by name alone may lead to mistakes in identifying the billing party, confirmation points, and cost responsibility.
Also, rather than disputing costs after they accrue, it is more effective in practice to understand deadlines beforehand and contact relevant parties early if delays are anticipated. Managing Free Time, D/O, customs clearance, delivery reservation, transportation, and return as a unified process is fundamental to preventing Demurrage, Detention, and Storage.
Summary
Demurrage, Detention, and Storage all relate to costs associated with the retention of cargo or containers, but they do not have the same meaning. Demurrage mainly applies to container retention within a CY or terminal, Detention refers to delays in returning empty containers after they have been moved outside the terminal, and Storage covers the costs related to storing cargo or containers at a facility.
For FCL shipments, it is important to consider these costs on a container basis, while for LCL shipments, they should be considered on a cargo basis. It is a fundamental practice to monitor not only import clearance but also D/O issuance, cost settlement, pickup scheduling, delivery, and empty container return, to ensure Free Time is not exceeded and avoid unnecessary charges.
