Picture of warehouse with crates ready to be loaded to lorries

What is Demurrage in International Freight Transport?

Demurrage in International Freight Transport

In terms of road transport, demurrage is the period of time in which a company or exporter remains in possession of a vehicle after the loading or unloading of products.

Another term which is common in international transport and logistics is “laytime”. Laytime is the agreed period of time for loading and unloading cargo.

The reason we want to educate you on demurrage is because it can affect the profitability of your company. Demurrage is a concept your company must understand and prepare for because it can often involve extra charges from the transport company to the exporter, unless previously negotiated in advance of course.

DEMURRAGE CHARGES FOR EXCEEDING LAYTIME

We advise all clients involved in European transport and distribution of cargo to discuss demurrage conditions in advance of using an international freight company, international haulage company or logistics broker.

If you use a transporter that charges for demurrage, the bad thing is that it increases the overall cost of cargo and freight.

Any company selling goods across Europe will find it hard to be competitive in the marketplace if said company is periodically losing money in the form of demurrage damages.

However, there is some good news to avoid paying demurrage charges. We at Cullen European Freight can advise new and existing clients on international logistics best practices in order to protect yourself from unpredictable events or possible situations which could cause demurrage.