DEMURRAGE ACCOUNT FEE

Tuesday, October 01, 2013

Dear Client,
 
 
A number of shipping lines have announced a reduction of free container time (the time available before the shipping line will charge daily detention fees) being a reduction from 10 free working days to only 7 free days from first day of availability. These changes has taken effect on 1st August 2012.
 
This will have an immense impact on the shipping and freight community.
 
Lochm has questioned how this new system is expected to work bearing in mind this will include the 2 days of a weekend and the first 3 days of availability. Clients will only be able to hold containers for maybe 1 or 2 days without being charged significant amounts of detention fees which in many cases exceed the actual cost of renting a container.
 
Many shipping lines provide hired containers as well supplying their own containers. Lochm would urge shipping lines to set the daily detention fees at rates that are not seriously out of step with the actual costs of renting a container.
 
Wharfs are not always able to accommodate collection of containers on the first day of availability which means that the clock is often ticking and our industry and our clients are forced to pay without any fault of their own.
 
These announced changes make it even more important for freight forwarders, who release the delivery orders to a 3rd party carrier, to be mindful, and to request, that the containers are returned on time to avoid or minimise any detention charge issues between themselves, their clients and 3rd party carriers.
 
This change is certainly not welcomed by our industry. Ultimately, we will need to consider these additional charges in freight rate negotiations with shipping lines and do everything to ensure that our clients are not adversely affected by this unfortunate move.

As of 1st of October Loch M. Fraser will introduce an agency fee of $25 per shippping line invoice.
 
 
Thank you and regards,

Danny Cobb
Director, Seafreight Operations

 
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