🇺🇸United States

Runaway detention & demurrage fees from poor coordination

5 verified sources

Definition

Shippers regularly incur large and recurring D&D expenses when containers overstay free time at terminals or are returned late, because pickups, unloading, and returns are not tightly coordinated. With daily fees commonly $75–$300 per container day at major ports, multi‑day delays across many boxes create six‑figure annual cost overruns that provide no added value to the supply chain.[2][3][6]

Key Findings

  • Financial Impact: $150,000+ per incident for large shipments, with total annual D&D costs often reaching hundreds of thousands of dollars for active importers/exporters (illustrated by demurrage examples where a single shipment incurs $150,000 in charges)[5]
  • Frequency: Daily
  • Root Cause: Free‑time windows are short (often 4–7 days for ocean demurrage and 3–5 days for detention) and vary by carrier and terminal, while internal warehousing, drayage, and customs processes are not synchronized to these limits.[3][4][5][6] Port congestion, documentation issues, and scheduling conflicts with dray carriers push containers past last free day; high, escalating daily charges then accumulate until the box is picked up or returned.[2][3][5][6]

Why This Matters

This pain point represents a significant opportunity for B2B solutions targeting Freight and Package Transportation.

Affected Stakeholders

Import/export managers, Transportation managers, Drayage planners and dispatchers, Warehouse managers, Customs brokers, Port and terminal operations teams, CFOs and logistics finance analysts

Deep Analysis (Premium)

Financial Impact

$100,000-$250,000 annually from repeated owner-operator delays • $100,000-$250,000 per year from repeated container overstays across merchandise imports • $120,000-$300,000 annually from multiple containers per month in D&D charges

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Current Workarounds

Distributor tracks free time via incoming port notification emails; manual follow-up texts to driver; back-charges driver if demurrage incurred • Driver calls dispatcher for quick verbal confirmation; no written record of free time; relies on carrier communication • Manual allocation to customer account based on invoice date; disputes resolved via phone with customer; some costs absorbed to maintain relationships

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Methodology & Sources

Data collected via OSINT from regulatory filings, industry audits, and verified case studies.

Evidence Sources:

Related Business Risks

Systemic under‑billing and billing‑error write‑offs on detention & demurrage

$50,000–$500,000 per year for mid‑size shippers and NVOCCs (extrapolated from typical fee levels of $75–$300 per container per day and hundreds–thousands of annual containers)[2][3][6]

Disputed detention & demurrage charges and rework

$5,000–$50,000 per month in staff time and concessions for a mid‑size forwarder or carrier (inferred from FMC‑mandated 30‑day dispute/mitigation process windows and typical per‑day charge levels)[1][2][3]

Delayed cash collection due to contested D&D invoices

$20,000–$200,000 in outstanding D&D receivables at any given time for medium carriers/NVOCCs (scaled from high per‑day fees and the 30‑day mitigation window plus negotiation cycles)[1][2][3]

Loss of equipment and terminal capacity from prolonged container time

Opportunity cost equivalent to losing multiple container turns per year per unit; with daily detention fees often only $50–$100, lost revenue from missed trips can exceed fee income by thousands of dollars per container annually[3][5]

Regulatory exposure and penalties over non‑compliant D&D billing

Individual FMC enforcement actions can reach into the millions of dollars in refunds and penalties across billing categories; D&D is a specific focus post‑OSRA‑2022 (risk level inferred from the Act and rule‑making focus on billing fairness).[1]

Opportunistic use of D&D as de‑facto storage or leverage

Tens of thousands of dollars per year in avoidable D&D per abusing shipper, plus significant opportunity cost for carriers whose equipment is tied up (estimated from fee ranges of $75–$300 per day and observed patterns of extended dwell)[2][3][6]

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