The fixture
The calculation
Still needs a cargo quantity and a rate per day, and when laytime commenced and completed.
Runs entirely in your browser. Nothing you type is sent to Neptune Atlas or stored anywhere.
How laytime and demurrage are calculated
Laytime is the time the charterer is allowed for loading and discharging. Demurrage is what the charterer pays when loading or discharging takes longer than allowed, and despatch is what the owner pays back when it finishes early. The calculation has four steps, but claims are usually decided by the facts rather than the arithmetic.
1. How much laytime was allowed
Divide the cargo quantity by the rate in the charterparty (the charter contract). 31,800 tonnes at 6,000 tonnes per weather working day is 5.3 days. Use the quantity actually loaded, from the bill of lading, not the figure written in the charterparty. For a cargo described as 30,000 tonnes with a ten per cent option, the difference is nearly nine hours of laytime.
2. When laytime starts
Laytime starts a set time, often twelve hours, after the ship gives a valid notice of readiness (a message saying the ship is ready to load or discharge). If the notice is not valid, laytime does not start. Many claims are lost at this step, before any calculation.
3. What stops laytime
Bad weather, excluded periods such as SHEX (Sundays and holidays excluded), breakdowns, and moving between berths, as the contract says. Put the total in the Time excluded field for that port. Once the ship is on demurrage, these exclusions usually no longer apply. The rule is "once on demurrage, always on demurrage".
4. The difference, in money
Take allowed time minus used time. A positive result is despatch, a negative result is demurrage. Multiply by the daily rate, and count part days in proportion. The rate is per day, not per hour. Using it as an hourly rate makes the answer twenty-four times too big. This is a common mistake, because the wrong answer still looks like a real amount.
What this calculator does not do
It takes the start and end of each port stay and a total for excluded time. A real claim is built from the statement of facts instead: a timed list of every event from arrival to completion. A period counts only if the event that started it counts. A stop with no recorded reason is a gap, not an exclusion. The other side of a claim argues about exactly these details, and a simple form like this one cannot check them for you.
Questions
- How do you calculate demurrage?
- Subtract allowed laytime from the time actually used, then multiply the extra time by the demurrage rate. The rate is per day, so 2.32 extra days at USD 14,500 per day is USD 33,672.22. Part days are paid in proportion.
- What is the difference between demurrage and despatch?
- Demurrage is paid by the charterer when loading or discharging takes longer than the laytime allowed. Despatch is paid back by the owner when it takes less time. Despatch is usually half the demurrage rate, but the rate in the fixture (the agreed deal) is the one that applies.
- What does reversible laytime mean?
- The load and discharge allowances are added into one. Time saved at the first port makes up for time lost at the second, and only the total difference is paid. With separate laytime, each port is counted on its own, so one voyage can owe demurrage at one port and earn despatch at the other.
- Which cargo quantity should I use?
- The quantity actually loaded, from the bill of lading, not the figure in the charterparty. If a cargo is agreed at 30,000 tonnes with an owner's option and 31,800 tonnes are loaded, laytime is based on 31,800.
- Is this calculator free?
- Yes, and there is no account and no limit. It runs in your browser, so nothing you type is sent to Neptune Atlas or stored anywhere.
- How accurate is it?
- It uses the same calculation as the Neptune Atlas app. An automatic test on every release checks that it gives the same result as the worked example in our laytime guide, to the cent. It cannot rebuild the time used from a statement of facts, and that is where real claims are decided.
The full guide, with a worked example and where claims are usually lost
Neptune Atlas calculates the time used from the statement of facts itself. Each event has a time and each stop has its reason, so demurrage comes straight from the timeline instead of a spreadsheet. See what it costs. There is also a free time charter equivalent calculator, a free sea distance calculator and a free IMO number checker. All four are on the free shipping tools page.