What is laytime?

The definition of LAYTIME is :

‘the period of time agreed between the parties during which the Owner will make and keep the vessel available for loading or discharging without payment additional to the freight’.

or

'the time allowed to the charterers to load/discharge cargo in return for payment of freight to the owners. If the charterers are unable to load/discharge cargo within this allowed period, they will be obliged to pay demurrage or detention to compensate the owners for their loss of use of the vessel'

Consequently, when there are delays involved in loading and discharging the pre-agreed laytime allowed for loading and discharging can be exceeded. If this is the case, additional freight is due to the Owner.

This additional freight is commonly known as ‘demurrage’.
BIMCO’s definition of demurrage is :

‘an agreed amount payable to the Owner in respect of delay to the vessel beyond the laytime, for which the Owner is not responsible. Demurrage shall not be subject to laytime exceptions’.

This last sentence is known as :

‘Once on demurrage, always on demurrage’

Weather and weekends, which can be usual interruptions in a laytime calculation cannot influence anymore the vessel being on demurrage. So the demurrage clock starts ticking until the vessel has completed her loading or discharge operations.

Many fixtures in shortsea shipping are done on the basis of, for example, 24/36 hrs or 2000/2000 mton per day for loading and discharging without realizing what the consequences could be for each individual fixture.

It can happen that you can easily allow available laytime to Charterers/Shippers and/or Receivers until the next Monday and sit the whole weekend in the port without being on demurrage (=income).

So actually, the ship is caught without having the pressure on the party loading or discharging the ship to hurry up with the threat of ‘better finish the ship, otherwise she will be on demurrage’…

There is not much the Owner can do, unless paying for overtime themselves, if available or if stevedores are willing to accept.

A guarantee for loading or fixing shorter hours for loading and/or discharging can expedite the voyage considerably which means greater revenue on the ships voyage / income.

Obviously, these quicker terms for loading and discharging and/or guarantees are always ‘market permitting’. If the freight market does not allow you to make your point it will be down to a commercial decision whether to accept the best terms achievable or look for other options (if available).

What also a point of concern is that ships command sometimes too easily (in a rush for the tide?) signs the documents presented to them like for example the Statement of Facts. If these contain incorrect information, the Owner might be disadvantaged in their laytime calculation and so not be entitled to the demurrage, which could be due to them.

In 9 out of 10 voyages (or perhaps 19 out of 20) there will be no demurrage. However, with the improved knowledge in postfixture one can quickly determine if there is a demurrage case or not and if one can improve the bill or not.

On the chartering and operational side of the fixture/voyage, with weekends involved, a guarantee for loading/discharging might do miracles. Also with raintimes sometimes just added on the Statement of Facts (just for the sake of it), a bit more research and care in signing official documents, and most of all, with the ‘now’ improved knowledge about laytime, one can save a lot of money, or earn some extra income (=demurrage).

References:
"There is so much more in LAYTIME !!" Erwin de Zwarte
www.steamshipmutual.com/publications