1.     What is Terminal Storage?¶

Terminal Storage is a charge applied to importers or consignees when they fail to collect the container from the port within the allowed free time allowed by the Cargo Handling Corporation Ltd (CHCL) terminal. It is a penalty imposed by the CHCL for using container terminal storage beyond the agreed period.

In FCL (Full Container Load) shipments, the charge applies per container.
In LCL (Less than Container Load) shipments, the charge is known as CFS Storage and applies when cargo remains uncollected at the Container Freight Station (CFS) beyond the free period.

1.1        Terminal Storage Process for FCL (Full Container Load)¶

1. Cargo Arrival at Port

• When a cargo shipment arrives at our port, it is offloaded and placed in the CHCL’s container yard.
• The freight forwarding system tracks the arrival date and assigns a free time period, typically 3 to 7 days, depending on the CHCL and port regulations.

2. Free Time Period

• The free time period allows the consignee (importer) to complete customs clearance and arrange for cargo pickup without incurring any charges.
• The freight forwarding system should notify the consignee of the free time start and end date.
• If the consignee fails to collect the container within this period, Terminal Storage charges begin.

3. Customs Clearance and Release

• The consignee must submit all necessary documents (e.g., Bill of Lading, Commercial Invoice, Import licence) to clear the cargo through customs.
• If customs clearance is delayed due to missing paperwork, incorrect declarations, or inspections, the container remains at the port, increasing the risk of Terminal Storage charges.

4. Terminal Storage Charges Start

• If the container is not removed within the free time period, Terminal Storage charges apply per day per container as per the CHCL’s tariff structure which is available at https://www.chcl.mu/storage-charges/.
• The freight forwarding system calculates Terminal Storage fees based on:
  • Number of days exceeded
  • Container size (20ft, 40ft, reefer, etc.)
  • Type of cargo (hazardous, special handling, etc.).
  • CHCL’s Storage rate
• Example calculation:
  • Free time: 5 days
  • Actual pickup: 10 days after arrival
  • Excess days: 5 days
  • Rate: Rs100 per day for a 20ft container
  • Total Storage = 5 × Rs 100 = Rs 500

Note: In FFS, we will not calculate the charges but will track free time and notify users.

5. Payment and Cargo Release

• The consignee must settle the Storage charges before the CHCL releases the cargo.
• After payment at CHCL, the latter allows for the container release process.

6. Container Pickup and Exit

• Once Terminal Storage charges are cleared, the consignee can schedule container pickup.
• The freight forwarding system records the final cargo exit date and updates the shipment status to Delivered.
• Any additional Terminal storage fees (such as demurrage charges) may apply if the container is not returned to the shipping line within the allowed period.

Example Use Case in FFS for FCL

·        March 1st: Container ABC123 arrives at CHCL.

·        March 5th: Last Free Day (LFD)/Deadline for pickup (5 free days).

·        March 6th: CHCL applies Storage charges if the container is not cleared.

·        March 10th: The consignee pays CHCL and uploads proof of payment in FFS.

·        FFS updates the container status to "Released", and the consignee arranges delivery. 

1.2        CFS Storage Process for LCL (Less than Container Load) at Container Freight Station¶

1. Cargo Arrival and Free Time Period

• In LCL shipments, multiple consignees share one container.
• When the container arrives, it is moved to a Container Freight Station (CFS) for deconsolidation.
• The consignee must clear and pick up their cargo within the free time (typically 3-7 days).

 2. CFS Storage Charges for LCL Cargo

• If the consignee fails to collect their cargo within the free time, CFS applies LCL storage charges.
• Unlike FCL, where the charge applies per container, LCL storage charges are based on:
  • CBM (cubic meters) of the cargo OR
  • Weight per ton/kilogram
• The FFS tracks storage duration but does not calculate charges.

Example Use Case for LCL Storage in FFS

• March 1st: LCL cargo arrives and is deconsolidated at CFS.
• March 5th: Last Free Day (LFD)/Deadline for pickup.
• March 6th: Storage charges start for the uncollected cargo.
• March 10th: The consignee (or FFWD pays on behalf of the consignee and charges back the latter) pays CFS and uploads proof of payment in FFS.
• FFS updates the shipment status to "Released", and pickup is arranged.

 CFS Storage vs. FCL Terminal Storage

2         Demurrage¶

2.1        What is Demurrage?¶

Demurrage is a charge applied after the container has left the terminal -CHCL but is not returned to the shipping line within the agreed free period.

2.2        Process of Demurrage in Freight Forwarding¶

1. Container Pickup & Free Days for Return
   • After clearing Terminal Storage (if applicable), the consignee picks up the container for unloading.
   • A separate free time period (e.g., 5-10 days) is given to return the empty container to the shipping line.
2. Free Time Monitoring
   • The Freight Forwarding System tracks the allowed return period.
   • If the container is not returned within the free time, demurrage charges begin.
3. Demurrage Charges Apply
   • Charges are applied per day for each overdue container (e.g., Rs 1500/day for a 20ft container, Rs 3000/day for a 40ft container).
   • The system calculates demurrage charges using:
     • Container size
     • Number of days overdue
     • Shipping line-specific demurrage rates
4. Demurrage Payment & Container Return
   • The consignee must pay the demurrage charges before returning the container. In most cases, the FFWD pays the demurrage charges on behalf of the client/consignee and then bills the latter back.
   • This is followed by a Payment Request sent to the accounting department to pay the Shipping Line and then issue an invoice to the client/consignee.
   • After the container has been returned, the Freight Forwarding System updates the shipment status as "Container Returned".

2.3        Key Differences: Storage vs. Demurrage (Detention)¶