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The significance of imposing demurrage on goods?

reasons for imposing demurrage on goods

Asked by: Osunwale Olanrewaju Stephen 644 days ago - 2 Answers - 1360 views

2 Answers

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Demurrage on goods is a penalty for exceeding free time (usually 72 hours) allowed for taking delivery of a shipment from the shipping or transporting company’s warehouse.

This is a matter of logistic. If the consignee doesn’t pick up the goods in a timely manner, the port would have a warehouse full of stuff and this would create a backlog that could potentially delay other shipments. So this penalty is important to make sure that everyone takes their goods out from the temporary storage area in a timely manner, so that the port can continues to operate efficiently.

Answer by pinyo 642 days ago
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== Shipping ==

In commercial [[shipping]], demurrage is an ancillary cost that represents liquidated damages for delays. It occurs when the vessel is prevented from loading or discharging cargo within the stipulated [[laytime]] (see [[Affreightment]]: under Charter-parties).

In container haulage, customers are given a set period in their contract to tip (unload) their container delivery. Acceptable times for tipping are usually between 3 and 4 hours; time spent on site after that is considered “demurrage”. Haulers will usually charge an hourly rate for each hour after the allowed time.

Demurrage can also refer to the cost levied by shipping lines to cover redecoration of the container after use by the merchant, but it could also be the charges by the shipping line to customers for not returning the container in a reasonable time.

time to time

Answer by Osunwale Olanrewaju Stephen 618 days ago

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