Shippers may finally have some recourse when it comes to detention and demurrage charges. Shippers have been complaining for years that detention and demurrage charges are being charged even when it is no fault of the shipper.
For example, everyone remembers the 2014-15 West Coast congestion and the gridlocked that brought the ports to a standstill. Shippers did their part by sending truckers to the port to pick up full containers. The truckers waited hours to pick up a single container but were usually turned away empty handed. Nonetheless, shippers were still billed demurrage charges because the containers were not removed from the ports within the allotted number of days. Shippers also hired truckers to return empty containers to the port only to be turned away because of the gridlock. Once again, shippers were billed detention charges for not returning the empty container to the port in the allotted free time.
No one is arguing that detention and demurrage charges should be eliminated from the industry. There needs to be mechanisms in place that provide incentives for shippers to quickly move containers in and out of ports. The Federal Maritime Commission (FMC) was part of a recent hearing that reviewed ways to fairly charge detention and demurrage. Without any changes, shippers will have no choice but to continue threatening carriers with loss of business unless unwarranted detention and demurrage charges are waived. Shippers are hopeful the FMC will offer some common-sense guidelines when they announce their findings.
The International Housewares Shippers Association (IHSA) is a not-for-profit association formed to benefit companies belonging to the International Housewares Association (IHA). Through the combined leverage of members, IHSA negotiates freight contracts and partners with other logistics providers to lower supply chain costs.
IHSA’s main function is to negotiate the lowest possible transportation rates and provide the highest quality service for all participating members. Additionally, IHSA members receive valuable market intelligence and advice through regular newsletters and briefings.
IHA member companies looking to reduce their ocean freight costs or have questions about an ocean freight issue are encouraged to contact IHSA to learn about the program. Contact IHSA at +1-513-489-4743 and learn more on our website.
