D&D charges to soar in India as peak shipping season approaches
Chennai ranked 9th on expensive port list; New York most expensive port with average combined D&D charge of $2,478
MSC Hamburg (399 metres long and 54 metres wide) at Mundra Port
Chennai is ranked at number nine on the list of the most expensive ports based on the average demurrage and detention (D&D) charges, and it is anticipated that these fees will increase as the ports in India become increasingly busy, according to the latest update from Container xChange.
The list was topped by New York with an average combined D&D charge of $2,478, followed by Oakland ($2,325) and Los Angeles ($2,069).
Chennai ($585), Jawaharlal Nehru Port Trust ($574) and Mundra ($574) are the Indian ports in the top 50 ports.
Cumulative D&D fees across shipping lines for key IST + SE Asia ports: 2023
"India is ranked in the fourth position, with $435 per day per container, among regions evaluated based on the average global D&D charges across various shipping lines and key ports," says the annual report on demurrage and detention fees.
The maritime sectors in India and Vietnam are experiencing remarkable growth, establishing themselves as emerging ports with increasing significance in global trade, the update added. "These countries have invested significantly in port infrastructure, undertaking modernisation projects and expanding their capacities to accommodate larger cargo volumes."
Christian Roeloffs, Co-Founder and CEO, Container xChange says: "India and Vietnam have emerged as key players in international trade with their ports witnessing impressive growth. As these countries continue to strengthen their positions, it is crucial for stakeholders to stay vigilant and make informed decisions regarding port selection, carrier partnerships, and supply chain optimisation strategies. By proactively monitoring the evolving landscape, businesses can navigate potential challenges associated with demurrage and detention fees while capitalising on the opportunities presented by these dynamic emerging markets."
D&D explained: Demurrage is the charge you pay for the delayed use of the container within the terminal beyond the free days. Detention is the charge you pay for the delayed use of the container outside the terminal or depot beyond the free days. |
Key findings
Global average D&D charge is down 25 percent YoY to $501, and 14 percent lower than 2020 ($586). "This is looking good for shippers – and feels like things are going back to normal.
"Still, 11 ports exhibit D&D fees that are higher than in 2020. These include Antwerp, Jebel Ali, Ningbo, Port Kelang, Rotterdam, Shenzhen, Singapore, Tianjin, Xiamen, Hong Kong and Guangzhou."
D&D fees over the last four years across shipping lines for key ports
CMA CGM had the highest average D&D charge of $591 (on day 14) and ZIM had the lowest charge of $485.
“Demurrage and detention should ideally be a free market," says Roeloffs. "The number of free days and the charges should be negotiable between parties and carriers, just like any other free market scenario. However, perhaps what needs regulation is clarity on when the clock starts. Establishing clear time stamps and determining who bears the burden of proof in cases of congestion, where a container cannot be picked up, would be crucial. Payment should only commence once the terminal is able to release the container. These aspects warrant attention and potential regulation.”