In global logistics, some of the most frustrating costs are the ones you don’t see coming. Demurrage and per diem (also known as detention by some shippers) fees are perfect examples. These penalties can accrue rapidly, disrupting budgets and operations for shippers caught off guard. But with the right strategy and partnerships, these fees aren’t just manageable—they’re preventable.
In this guide, we’ll break down what demurrage and per diem mean, why these charges exist, and how shippers can avoid them. We’ll also share a real-world example from HVAC industry leader DiversiTech, who partnered with Averitt to eliminate their demurrage and per diem costs entirely.
What Are Demurrage and Per Diem Fees?
Demurrage and per diem are charges imposed by ocean carriers for the use of their equipment beyond a specified free time:
- Demurrage: Applies when a container remains at the terminal beyond its free period.
- Per Diem: Applies when a container is out of the terminal—in transit or at a warehouse—but not returned in time.
Both fees are meant to incentivize quick turnover of container equipment, but for many shippers, they create unexpected cost burdens. According to the Federal Maritime Commission, a 2024 ruling now require invoices to provide a 30-day window for disputes, signaling how widespread and problematic these charges have become.
Why These Fees Are So Expensive—and So Common
The logistics of moving freight from port to warehouse locations are complex. Any breakdown in coordination can lead to fees. Common causes include:
- Port congestion and limited terminal space
- Lack of chassis availability
- Warehouse backlogs
- Limited container visibility and tracking
A 2023 study in the Journal of Shipping and Trade notes that demurrage and per diem issues are especially prevalent in intermodal service networks where coordination across stakeholders is weak.
Case Study: How DiversiTech Eliminated Fees with Averitt
Matt Krause, COO at DiversiTech, faced major inbound cargo challenges at the Port of Savannah. "We were paying hundreds of thousands of dollars in per diem and demurrage fees," he said. The company lacked clear visibility over their freight, and their warehouse couldn’t always receive cargo on schedule.
That changed when DiversiTech partnered with Averitt. By leveraging Averitt’s asset-based chassis, port drayage services, and transloading services, the team gained better control and flexibility. "Averitt started taking our floor-loaded containers, palletizing them, and holding them at their terminal until we were ready. That eliminated 100% of our demurrage and per diem costs," Krause explained.
He credits this success not just to strategy, but to shared values. “If you set the right culture, you can provide the customer experience you need to grow,” he said.
Want to hear the full story? Watch our interview with DiversiTech’s COO to see how better planning and the right partner made all the difference.
Strategies to Minimize or Eliminate D&D Fees
Shippers can dramatically reduce or eliminate fees by taking proactive steps:
- Partner with Asset-Based Providers: Providers like Averitt own their own chassis and operate inland terminals near ports, creating flexibility and reducing wait times.
- Transload and Hold Freight: Instead of moving full containers to your warehouse, transload to pallets and store near-port until you’re ready to receive it via LTL services or truckload services.
- Enhance Visibility and Coordination: Use real-time tracking tools to align warehouse availability with port arrivals.
- Understand Your Free Time: Terms vary by carrier. Knowing when the clock starts and stops is crucial to planning ahead. Carriers like CMA CGM and Maersk publish their per diem policies online.
- Challenge Improper Charges: Under new FMC billing regulations, you have the right to dispute unjustified invoices.
- Benchmark Your Performance: According to Container xChange, average D&D charges dropped 25% globally in 2023—but U.S. ports remain among the highest. Knowing how your operations compare can drive improvement.
Demurrage & Per Diem: Myths vs. Facts
Myth 1: “Demurrage and Per Diem fees are just part of doing business at the port.”
Fact: These fees are avoidable with proper planning, visibility, and the right logistics partner. As DiversiTech’s case shows, you can reduce them to zero.
Myth 2: “There’s no point in disputing a demurrage invoice—carriers never waive them.”
Fact: Under FMC regulations, shippers have 30 days to dispute charges, and carriers must meet specific documentation requirements.
Myth 3: “Once a container is on demurrage, you just have to wait it out.”
Fact: Strategies like transloading, palletization, or re-routing to near-port storage can free up containers and stop the clock.
Myth 4: “Only importers with massive volume can negotiate better terms.”
Fact: Mid-size and even small shippers can access flexible capacity and cost-saving solutions through asset-based providers with shared distribution networks.
Conclusion
Demurrage and per diem fees are a symptom of larger coordination and capacity issues in the supply chain. But as DiversiTech's experience proves, the right inbound strategy can eliminate them entirely. With asset-based flexibility, portside distribution, and proactive planning, shippers can gain control and protect their bottom line.
Ready to Eliminate the Fees?
Contact us today to learn how Averitt’s PortSide® Solutions can help you avoid unnecessary delays and costs. Fill out the form below, and our team will help you build the most efficient solution for your container logistics needs.
