What Are Demurrage, Detention and Storage Charges? Shipping Fees Made Simple

Many Australian businesses don't fully understand that demurrage, detention, and storage charges are common fees in international freight shipping. In fact, a 2022 submission to the Productivity Commission reported that Australian exporters and importers are collectively paying over one billion dollars annually in unreasonable international shipping fees. This includes container detention and storage charges.​

If you're importing or exporting through major ports like Sydney, Melbourne, or Brisbane, you’ve likely seen these fees on an invoice. While they may seem unexpected and confusing to understand, knowing when and why they apply can help you avoid them altogether.​

In this article, we’ll break down demurrage, detention, and storage charges into simple terms. We’ll explain who pays, how they’re triggered, and what you can do to reduce them. 

We’ll also show how working with a logistics partner like Couriers & Freight can help you stay ahead of these costly surprises.​

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Understanding Demurrage, Detention, and Storage Charges

Demurrage, detention, and storage charges are extra costs linked to delays throughout the shipping process. These charges can add up quickly and vary depending on the port, shipping line, and container type.

They are not always easy to understand, especially for first-time shippers. But knowing what they are and when they apply can help you avoid unnecessary expenses and keep your supply chain running smoothly.

Differences Between Demurrage, Detention, and Storage Charges

Demurrage, detention, and storage charges are often assumed to mean the same thing. In reality, they refer to different costs that apply at various stages of the shipping process.

You will be charged with demurrage when your cargo stays at the port for too long after it arrives. Ports allow a limited number of free days for you to clear and move your cargo. If the cargo remains beyond that period, you start paying daily demurrage fees. 

For instance, importers typically have three days to clear their goods through customs and quarantine upon arrival at Australian ports. If clearance takes longer, various fees, including wharf storage fees ranging from $100 to $250 per container per day, may be added to the cost. 

Detention is different. It happens when you take the container out of the port but don’t return it on time. Shipping lines give you a set number of free days to unload and return the empty container. If you miss that deadline, detention charges begin. 

Terminal or warehouse charges storage fees for cargo or containers that remain for too long. Once the free storage time is over, fees start to add up. For example, storage fees could be charged to your bill if your products are kept in a warehouse in Brisbane due to a delay in delivery or paperwork.

The best way to understand the differences between demurrage, detention, and storage charges is to understand where the delay occurs and who is responsible. 

Who Pays for Demurrage, Detention, and Storage?

Understanding who is responsible for these fees is important. In most cases, the responsibility falls on the shipper, which includes both importers and exporters.

Importers usually pay demurrage, detention, and storage charges if they do not clear cargo within the free time. For example, an importer bringing goods through the Port of Melbourne may face demurrage charges if customs clearance takes too long. If they also delay picking up the container, they may incur storage fees from the terminal.

Exporters are often responsible for detention charges. This happens when they hold on to containers longer than the agreed free time. So if an exporter from Brisbane misses the return deadline, the shipping line may apply detention fees. These fees can quickly add up if the container is not returned promptly.

Freight forwarders or customs brokers may assist in managing these charges. However, they do not usually cover the costs themselves. The final responsibility still lies with the shipper.

Why Do These Charges Apply?

Demurrage, detention, and storage charges exist for a reason. They help ports, shipping lines, and warehouses manage space and resources. These facilities operate on tight schedules and high volumes, and delays can cause major congestion and impact other shipments.

When cargo stays too long at the port, it blocks space for other containers. Demurrage charges encourage importers to move their goods quickly. Meanwhile, detention charges incite businesses to make sure that containers are moved on time. Shipping lines rely on the fast return of containers to keep their operations running. 

Warehouses have limited space, and they need cargo moved out to make room for new shipments. Storage charges push businesses to act quickly and clear their goods before free time runs out.

Often, these charges happen due to poor planning. Missing paperwork, delays in customs, or a lack of transport can also cause problems. In some cases, unexpected issues like weather or strikes can create delays, too.

How to Avoid Demurrage, Detention, and Storage Charges

Avoiding demurrage, detention, and storage charges starts with planning. Businesses should prepare early for customs clearance to avoid delays that lead to unnecessary fees. 

Know how long your goods can stay at each port without fees. It lets you act quickly before penalties apply. For example, Victoria International Container Terminal (VICT) at the Port of Melbourne offers a free storage period of 3 days for import containers. 

Always return containers on time by keeping track of container return deadlines. Detention charges can add up fast when containers are late. Storage charges can also grow quickly if goods are left at a warehouse or terminal for too long.

Clear communication is another key. Stay in touch with your logistics provider and port contacts. Know when your cargo arrives and when it needs to be picked up. Late pickups are one of the most common reasons for storage fees.

Working with experienced shipping partners can greatly help in avoiding the charges. A reliable freight forwarder that knows the process and can help businesses plan ahead and keep shipments moving. 

Couriers & Freight offers an end-to-end logistics solution that can track every stage of your shipment while reminding you of important deadlines. We also assist with customs clearance, container returns, and pickup scheduling, which can prevent demurrage, detention, and storage charges. Our local knowledge and strong industry links make us a trusted partner for importers and exporters across Australia.

Business Benefits: Avoid Demurrage, Detention and Storage Charges

If you are not prepared, demurrage, detention, and storage charges can quickly add up. 

By understanding when charges apply and who is responsible, you can better plan your shipments, avoid unnecessary costs, and reduce the risk of unexpected fees. Staying informed and proactive helps keep your supply chain running smoothly and protects your bottom line.

Stop Paying Unnecessary Shipping Fees

Avoid demurrage, detention, and storage charges. Stay in control of your freight with expert help from Couriers & Freight.

Get a Quote Now