A charge assessed by a railroad against a shipper or consignee for detaining a railcar beyond the allowed free time at a loading or unloading facility. Demurrage incentivizes rapid car turnover and compensates the railroad for lost car utility. It is distinct from detention, which applies to equipment held at non-railroad locations.
A charge levied when intermodal equipment such as chassis or containers is held beyond the allowed free time at a shipper or consignee's facility. Detention applies specifically to intermodal assets at non-railroad locations, differentiating it from demurrage. Both charges encourage efficient equipment utilization.
The period allowed by the railroad during which a shipper or consignee may load or unload a car without incurring demurrage charges. Free time allowances vary by commodity, car type, and tariff. Once free time expires, demurrage begins to accrue at the published daily rate.
A railroad industry practice where a car is deemed to have been placed at a customer facility for purposes of calculating free time, even though physical placement is not possible due to congestion or other conditions at the facility. Constructive placement notices are sent to the shipper or consignee to begin the demurrage clock. It protects railroads from liability for delays caused by customer-side congestion.
The physical positioning of a railcar at a shipper's or consignee's loading or unloading spot, as opposed to constructive placement. Actual placement occurs when the car is in position and accessible for the customer's use. The date and time of actual placement is recorded and used to calculate demurrage.
A daily charge paid by one railroad to another, or to a private car owner, for the use of freight equipment beyond a specified time. Per diem is a subset of car hire charges and is calculated on a calendar-day basis. High per diem rates incentivize railroads to return foreign cars promptly.