Demurrage and detention charges cost UK importers an estimated £800 million annually. Most businesses treat these costs as "unavoidable"—a penalty for late container pickup or return. But demurrage is 100% preventable with the right tracking systems and processes.
This guide breaks down exactly how demurrage works, the 48-72 hour rule, and automation strategies to eliminate detention charges entirely.
What is Demurrage vs. Detention?
These terms are often used interchangeably, but they're different:
- Demurrage: Charges for using a container at the port/terminal beyond the "free time" period (typically 3-7 days). You've picked up the cargo but haven't returned the empty container.
- Detention: Charges for keeping the shipping line's container beyond the free time after it leaves the port. The container is at your warehouse or in transit.
Both are expensive. Rates start at £50-80/day and escalate quickly. After 10 days, you might be paying £150-200/day per container.
The 48-72 Hour Rule: Your Early Warning Window
The key to avoiding demurrage is getting alerts before you enter detention. Once you're in detention, you're already losing money.
Here's why 48-72 hours matters:
- 48 hours: Minimum time needed to coordinate container pickup if there's a customs delay or warehouse scheduling issue.
- 72 hours: Safe buffer for unexpected delays (port congestion, haulage availability, etc.).
Critical: Getting a demurrage alert on the day free time expires is too late. You need 48-72 hours advance warning to take action.
Common Causes of Demurrage (And How to Fix Them)
1. Customs Delays
Your shipment is stuck in customs clearance. Free time is ticking down. By the time customs releases it, you're already 2 days into detention.
Solution: Use compliance platforms with 0.14-second screening (vs. 24-48 hours manual screening at banks). Fast compliance = fast customs clearance.
2. Missing Documentation
You're waiting for a Bill of Lading, commercial invoice, or packing list from your supplier. The container arrives but you can't clear it because paperwork is incomplete.
Solution: Automated document tracking. Get notified when shipment documents are uploaded. Chase missing docs 7 days before arrival.
3. Warehouse Not Ready
Your container arrives but your warehouse doesn't have space to unload it. The container sits at the port for 5 extra days. That's £250-£400 in demurrage.
Solution: Real-time ETA tracking with 48-72h alerts. Warehouse team gets automated notifications to prepare for arrival.
4. Payment Delays
You need to pay port charges or customs duties before releasing the container. Your payment is stuck in 24-48 hour bank clearing. Meanwhile, free time expires.
Solution: Use FX platforms with 2.3-second settlement (within platform) or same-day settlement (to external accounts). No more waiting 2-3 days for payments to clear.
Demurrage Cost Breakdown: What You're Actually Paying
Example: 20ft Container at Felixstowe
| Days Late | Daily Rate | Cumulative Cost |
|---|---|---|
| Days 1-3 | £60/day | £180 |
| Days 4-7 | £90/day | £540 |
| Days 8-14 | £150/day | £1,590 |
| Total (14 days late) | £2,310 |
For perishable goods (food, pharmaceuticals), a 14-day delay isn't just £2,310—it's total product loss.
Automation Strategy: Eliminate Demurrage with 3 Systems
System 1: Real-Time Container Tracking
Track every container from departure to port arrival to pickup. Get automated alerts at these critical milestones:
- 72 hours before ETA: Alert warehouse to prepare space
- 48 hours before free time expires: Alert logistics team to schedule pickup
- 24 hours before free time expires: Escalate to management
Most container tracking services charge £2,000-£3,000/year. Unicorn Currencies includes it for free with FX service.
System 2: Fast Payment Settlement
Don't let slow bank payments delay container release. Use FX platforms with:
- 2.3-second settlement (within platform network)
- Same-day settlement (to external accounts via local rails)
- 0.14-second compliance screening (vs. 24-48 hours at banks)
System 3: Automated Document Workflows
Missing paperwork is a major cause of demurrage. Automate document collection:
- Supplier uploads docs to platform (not email)
- AI OCR extracts critical fields (container number, BL number, etc.)
- Automated alerts if docs are incomplete 7 days before arrival
Case Study: Food Importer Eliminates £11,200 Annual Demurrage
A UK food importer was paying £11,200 annually in demurrage charges—3 incidents per year averaging £3,400 each. Root causes: customs delays (slow bank payments) and poor container tracking.
After switching to Unicorn Currencies:
- FREE container tracking with 48-72h alerts
- 2.3-second payment settlement eliminated customs delays
- Zero demurrage charges in 12 months
Result: £11,200 saved annually
Action Plan: Implement This Week
- Audit your demurrage costs: Calculate total demurrage/detention charges over the past 12 months. Identify root causes (customs delays, warehouse issues, etc.).
- Set up automated container tracking: Use a platform that provides 48-72h early alerts, not day-of notifications.
- Eliminate payment delays: Switch to an FX platform with same-day settlement and 0.14-second compliance screening.
- Automate document collection: Stop relying on email for critical shipping documents. Use a platform with built-in document workflows.
The Bottom Line
Demurrage is 100% preventable. The solution isn't working harder—it's automation. Real-time tracking, fast payment settlement, and 48-72h early alerts eliminate detention charges entirely.
If you're paying £5k-£15k annually in demurrage, you're leaving money on the table. Implement automated tracking this week.