Wharf demurrage: the landlord's charge, not the carrier's

The word names three different charges

Most of the confusion about demurrage on an American import is not about arithmetic. It is that three parties use the same word for three charges, and the invoice rarely says which one it is.

A shipowner’s demurrage is what a voyage charterer pays for exceeding laytime, and it has its own entry under vessel demurrage. A carrier’s demurrage is what a container line charges for its box sitting at the terminal past the free time in its tariff or your service contract. Wharf demurrage is the third one, and it is the only one billed by somebody who owns no ships and no containers: the port authority or the terminal operator, for the square metres your cargo is occupying.

Outside the United States the same charge is usually called storage, which is at least unambiguous. There is a separate entry on the terminal storage charge and what it covers. The US tariffs keep the older word.

What the tariffs actually say

The Northwest Seaport Alliance puts the definition in one sentence, and it is the clearest of the three: wharf demurrage is “a charge assessed against cargo remaining in or on terminal facilities after the expiration of free time unless arrangements have been made for storage.”

Three things in that sentence do work.

“Cargo”, not equipment. The charge attaches to what you imported, not to the container it came in. That is why it survives the carrier’s bill rather than duplicating it.

“Terminal facilities”, not the port. A box trucked out of the gate to a container freight station is off this clock and onto that yard’s own one.

“Unless arrangements have been made for storage”, which is the part almost nobody uses. Wharf demurrage is what you pay for not having asked. Both Los Angeles and the Alliance will hold cargo longer at a lower, flat rate if you apply in time. The Alliance wants a written request describing the cargo and the storage type, accepted “no later than 24 hours prior to the cargo’s arrival”. Twenty-four hours before arrival is a decision taken while the ship is still at sea, which is exactly the deadline a desk working from an arrival notice has already missed.

The free days and the charged days run on different calendars

This is the single most expensive misreading in the family, and the Alliance tariff states both halves inside one item.

Free time: “Saturdays, Sundays and Holidays will not be counted.”

Then, once the charge begins: “all days will be counted, including the day the container or chassis is removed from the premises.”

So four free days at Seattle can span a week of calendar, and the eighth day of overstay is charged whether or not anybody could have collected the box. Port of Los Angeles says the same thing in two items a page apart. Item 720 excludes Saturdays, Sundays and fourteen named holidays from the free period, Item 780 charges the demurrage “Saturdays, Sunday and holidays included”. There is a separate entry on working days or calendar days and how eight published tariffs each count a free day.

Seattle and Tacoma subordinate their own tariff to the carrier’s

Everywhere else this site has read a terminal tariff, the terminal’s clock and the carrier’s clock are independent: two charges, two documents, neither mentioning the other, and a late clearance pays both.

The Alliance tariff is the first that says otherwise, in a note under Item 657.000: “Containerized cargo may be subject to Free Time Rules and Demurrage Charges as carried in ocean carrier’s Tariff. Cargo owners are therefore referred to vessel Tariffs. In the absence of overriding ocean carrier Tariff Rules, Free Time will be granted and Wharf Demurrage or Storage assessed in accordance with Rules, Conditions and Rates named in this Tariff.”

Read plainly: at Seattle and Tacoma the published four days are a default, and your carrier’s tariff displaces them where the two disagree. That does not make the two charges one charge, because the Alliance still bills the ground and the line still bills the box, but it does mean the free period you are counting against may not be the one printed in the port’s own document. The full figures, by direction and by mode, are on the Seattle port page.

That is also the reason a figure typed once into a spreadsheet goes wrong quietly. Four published tariffs on this site grant free time in days that exclude weekends and four in days that do not; one of the eight then says its own number yields to a document the desk may not have read. Software that keeps the counting basis and the governing document alongside the number, which is what demurrage and detention software that stores which tariff grants the free days has to do, is the difference between a deadline and a guess. If you have the invoice in front of you and want the arithmetic rather than the rule, the demurrage calculator takes the free days and the bands off your own paperwork.