If you’re in the industry of moving containers or shipping goods, you already know this. If things don’t go as planned, there’s a sea of surcharges just waiting to be paid. One of these fees is the container storage charges – charges that can vary widely depending on where you are. So, here’s an overview of when you can expect to be charged this fee, how much, and ways to avoid them in the first place.
Everyone knows that time is money. But few feel that saying as much as the forwarders and shippers’ wallets do. All of them are familiar with demurrage, detention, and container storage charges.
These fees were originally introduced as compensation for using the equipment and facilities inside container yards, freight stations, and warehouses. As well as encourage the container users to move their boxes as quickly as possible. However, over time, they’ve more become additional frustrating costs in the freight forwarding process.
Let’s first define what a shipping container storage charge is and why you have to pay it.
What is a container storage charge?
Container storage charge covers the usage of space occupied by the container inside the terminal grounds, warehouse, or container yard. The storage period starts when the container enters the storage facility and ends when it’s taken out of the territory.
These charges are collected for full containers that haven’t been cleared for import. As well as for full containers that are waiting to be shipped and empty containers stacked within the port.
As soon as the vessel enters the port and shipping containers get loaded off, the ports offer a certain amount of free days for the container to stay on the premises. These free days allow customers to process the import requirements. Something that should eventually result in the container being moved out, or shipped back.
However, there are cases when container users can’t move the container from the port. That can be because of complications with documentation, financial or contractual problems, bad scheduling, etc.
In these situations, the container will be stuck at the port’s container yard or terminal grounds. And that’s when you will have to pay a fee for taking up space.
The port storage charges are often passed from the terminal operator to the shipping line. That’s why customers often assume that storage charge is a shipping line cost, but it’s the port, terminal, or depot that collects the fee via the shipping line.
Here, a margin is often added on top before the line collects the fee from the customer.
Container storage charges vs demurrage and detention
Now that we know what the container storage charge is, let’s look at how it differs from demurrage and detention.
Note, that sometimes demurrage and storage charges overlap and you’ll end up paying for both of them. However, there are some places where port storage charges and demurrage are recognized as the same.
If you have to pay demurrage charges, you can be in two basic situations.
The first: You have imported a container. The full container isn’t moved out of the terminal to be unpacked within the free days. You’ll, therefore, have to pay demurrage.
The second: You export a container, but the shipping line can’t load the container on board the ship. The reason the container can’t be loaded must be because of a lack of documentation or other mistakes, that aren’t related to the carrier. If you find yourself in that situation, you’ll be charged demurrage.
Here, you see how it’s similar to the storage charge. As long as the container is static on the port or terminal premise, you have obligations to pay off.
In case of the demurrage, it’s directly the shipping line that requires you to make the payment due to the delayed clearance. On the other hand, it’s the terminal that collects the fee through the shipping line for storage usage.
Unlike demurrage, detention charges are added when a container is outside the port. If you hold on to a carrier’s container for longer than the allowed free days, you will be charged detention.
You can also be charged detention fees when you export containers. Let’s say that you pick up an empty container to load it. But you don’t return it before the free days run out. Then the carrier will impose detention charges.
Here, at Container xChange we have been tracking down the demurrage and detention charges for you. Learn every detail that there are about demurrage and detention charges in our blog – including how to calculate them.
When you’re already paying…
storage charges and demurrage or detention you’ve also got truckers, customers, and carriers impatiently waiting. And that comes with a heavy price tag.
With so many uncertainties, the key to avoiding as many extra payments as possible is to know if any changes have occurred. Knowing that the ETA has changed, you can contact the trucker, the customers, and even renegotiate free days or fees ahead of time. Now you might wonder ‘How do I do that?’ The simple answer is: by avoiding leasing containers through carriers – and digitizing your container logistics. Sounds like quite the mouthful? It doesn’t have to be with Container xChange.
On xChange you’ll not only have all the information about every shipment right here in one place – your trading and leasing offers are also automatically updated for you. And you avoid leasing containers from carriers with hefty and hidden charges like demurrage and detention. Want to learn more about how xChange can help you avoid extra fees and save time and money? Click on the banner below, and book a call with our team.
Container storage charges across regions
As we mentioned, the exact number of free days to use the port yards and terminal spaces depends largely on the location, ocean carrier, equipment, and facility type. In some warehouses, no free time is allowed at all.
The container storage charge varies similarly. Here are some of the examples:
Lost Angeles port – storage price can be $125 per container per day from day 6 on.
Long Beach – storage price can be between $70-125 per container per day from day 5 on.
Hamburg – prices start between 30 to 105 Euros for each dry container after the free days are over. In case of import free days end after 5 days, but in case of export, after 8.
Antwerp – prices start between 15 to 30 Euros for each dry container, after the free days limit. Free days can be up to 7 days.
Rotterdam – prices vary between 15 and 30 Euros. Again, free days can be up to 7 days.
Bremerhaven Port – pieces start from 30 to 105 Euros per container, after 6 free days are over. Once again, prices depend on the type of container and time spent on the ground.
Singapore – in some cases, offers only 2 free days. Usually, after 7 days, you should expect to pay anything between $30 to $600, depending on the type of equipment and days inside the terminal.
Shanghai – imported cargo-free days end after 5 days. After that fee can be as little as around 10 Euros per day. Charges on exporting containers are even lower.
Busan – this port turns out to be one of those locations that don’t charge the container yard storage fee. It calculates a combined demurrage fee instead.
How to avoid the container storage charge
Plan and negotiate in advance
To minimize the costs and risks of charges such as storage fee, detention or demurrage – it’s vital to plan ahead and dispatch your cargo as soon as possible. Schedule and prepare for time buffers. Inform all involved parties about the whereabouts of your containers, and lastly – ask for an extended amount of free days, if possible. This one might come tricky, but it’s worth a try.
Have real-time information
Track your containers. Have real-time information on your container’s shipping status. With real-time data, you can make proactive decisions in case of delays and minimize your costs. Start tracking all your containers and receive tracking alerts with Container xChange. Rely on accurate tracking data, not on what others tell you when containers require your attention.
Analyze and learn from the data
Data is never collected just to be dumped in the files of unused files. Always analyze your past performance to identify the issues that cause the delays. This should help you optimize your free days at the POD. After analyzing your delay times, you might realize that you are spending your free time efficiently and you should be focusing it at a different, more congested port.
Digitize and avoid extra costs with Container xChange
Handling container storage charges requires preparation, time management, and knowledge of each port where your container ends up. The best way to avoid these extra fees is to digitize your container logistics. Imagine this:
All your container information and statuses are gathered in one place. You’re notified of changes to the container journey such as new ETAs. If you have customers chiming you down every day asking for an update on the shipments, they would also be able to log in to one website and find all the information they need readily available for them. This way you would be able to focus on your customers and the boxes that actually need your attention.
At the same time, whenever you need new containers to ship goods for your clients, you’ll be able to source them on the same platform. Not only saving you time on searching, vetting, and negotiation but also keeping it simple with all your information at the same place.
With Container xChange you can do exactly that.
No more manual tracking, no more time-consuming vetting processes, and SOC containers in more than 2500 places worldwide – right at your fingertips. And don’t forget that, unlike storage charges, demurrage and detention are charges that you can almost completely avoid with SOC containers.
Want to learn more? Click on the banner below and schedule a call with our team – they’ll show you how the platform works and how xChange can help you save money on container storage charges and other surcharges.