Port terminals may pile up and demurrage is not the main issue
Supply Chain Management
Caio Alves
Published Apr 9, 2020
Imports are expected to pile up at port terminals in the upcoming weeks. And agro-food value chain now faces a potential threat of a bottleneck at the very short term. Recent updates of container lines, ports, and forwarders show that US port congestion can spike fast If more retailers and manufacturers falter on container withdrawals.
In anticipation of such events shipping lines were offering storage in order to prevent demurrage costs incurrence, of which it varies from $75 to $150 per container a day, with potential increase if more than 5 days need to be carried over for longer periods. However many warehouses are full or even closed due to not being deemed essential service or because importers requested delivery delays from distribution spots. Ports may start running out of places to store incoming shipments, causing a seizure in the value chain.
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