Meaning
Financial obligation incurred when imported resin containers remain at the terminal beyond the allotted free time. Resin importers and distributors must manage their shipping schedules to avoid these costly charges. This liability can arise from port congestion, customs delays, or transport shortages.
Supply Delay
Delays can occur due to labor disputes, customs issues, or documentation errors that prevent the release of the resin containers. If the material is held at the port, the moulder’s production line may run out of resin, causing shut-downs and missed shipments. This supply interruption is a risk for operations that rely on imported polymers.
Commercial Cost
The fees charged by shipping lines and port authorities can escalate quickly, with rates increasing the longer the container remains on the dock. These charges reduce the financial benefits of sourcing cheaper resin from overseas suppliers. This cost can sometimes exceed the value of the polymer itself if the delay is prolonged.
Risk Mitigation
Procurement teams can reduce this risk by establishing clear contract terms that allocate port demurrage liability to the freight forwarder or supplier if the delay is their responsibility. They can also maintain safety stock of resin in local warehouses to ensure production continuity during port delays. This strategy helps protect the moulder from both logistics costs and production disruptions.