What is Detention?
Detention is a term often used in logistics and shipping and refers to the fee charged when a shipper or receiver of cargo uses equipment, such as shipping containers, longer than originally agreed upon. In this article, we will explore the meaning and important aspects of detention in more detail.
How does Detention work?
1. Definition and Causes of Detention.
Detention occurs when the shipper or receiver of cargo exceeds the agreed period, also known as "free time," for the use of equipment, such as containers. This can happen when the container is not returned to the shipping company on time or when it is made available later than agreed upon.
2. Costs and Consequences of Detention.
Detention costs can be significant and are usually charged based on a daily rate determined by the shipping company or equipment rental company. Failure to return equipment on time can result in additional costs and disruptions in the logistics chain. In addition, it can affect equipment availability for other customers.
3. Managing and Preventing Detention.
To manage and prevent detention, it is important to establish clear agreements and instructions in the transportation contract. It is essential to properly manage timelines and ensure timely return of equipment to the shipping company or rental company. Communication and cooperation with all parties involved, such as shipping companies, shippers and logistics providers, are key to minimizing disruptions and additional costs.
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Main causes of demurrage and detention
The cost for demurrage and detention can occur as a result of various causes. Some common causes include:
- Delay caused by incorrect documents
This delay can occur when required documentation is not completed correctly or completely, resulting in additional time needed for correction or verification. - Delay due to late receipt of documents
Failure to receive the necessary documents in a timely manner can lead to delays in releasing cargo and returning equipment, which adds time and cost. - Delay due to loss of documents
The loss of important documents can lead to significant delays as it takes time and effort to replace the lost documents and re-execute the necessary procedures. - Delay due to customs clearance or cargo inspection
In some cases, delays may occur due to extensive customs clearance or performing inspections on the cargo, which will take additional time before the cargo can be released. - Delay in releasing transport at destination
There may be delays in releasing transportation at the destination, such as terminals or warehouses, requiring additional time before equipment can be returned. - Delay due to inaccessibility of recipient
If the consignee of the cargo cannot be reached or does not take action to return the equipment in a timely manner, it can cause delays and increased costs.
Frequently asked questions about Detention:
Who determines the cost of Detention?
Detention costs are usually determined by the shipping company or equipment rental company. They use a daily rate that is applied based on the length of time the "free time" period is exceeded. The daily rate may vary depending on the specific shipping company or rental company and regional market conditions.
How can I control and avoid detention costs?
To control and avoid detention costs, it is important to have clear agreements in the transportation contract regarding the "free time" period and responsibilities. Ensure good communication and cooperation with all parties involved to minimize delays.
