What is dead freight?

What is dead freight?

• A. The payment a voyage charterer makes if unable to supply the agreed cargo quantity
• B. A fee charged for delaying shipment
• C. A penalty for late presentation of documents
• D. The freight charged for partial shipments

Answer: (A)

In a voyage charter, freight is earned only on cargo actually loaded. Dead freight is the payment the charterer owes for the portion of the contracted cargo that is not loaded, compensating the shipowner for the unused capacity caused by the charterer not supplying the agreed quantity. For example, if 10,000 tons are contracted but only 7,000 tons are loaded, dead freight covers the 3,000 tons not loaded at the agreed freight rate. This is distinct from charges for delays (demurrage), penalties for late documents, or freight for partial shipments—the specific concept is the compensation for undelivered cargo.

In a voyage charter, freight is earned only on cargo actually loaded. Dead freight is the payment the charterer owes for the portion of the contracted cargo that is not loaded, compensating the shipowner for the unused capacity caused by the charterer not supplying the agreed quantity. For example, if 10,000 tons are contracted but only 7,000 tons are loaded, dead freight covers the 3,000 tons not loaded at the agreed freight rate. This is distinct from charges for delays (demurrage), penalties for late documents, or freight for partial shipments—the specific concept is the compensation for undelivered cargo.