Deadfreight
Deadfreight is compensation payable to the shipowner when a charterer fails to load the full quantity of cargo agreed under the charter, leaving space that the owner had committed unused. Because the owner was entitled to freight on the whole agreed quantity, the charterer must pay for the shortfall — the “dead” (unearned) freight — as if the space had been filled.
It arises where a charter specifies a cargo quantity (often with a permitted margin) and the charterer supplies less, whether through a shortfall in the cargo, mis-estimation, or the ship's capacity not being fully used. Deadfreight protects the owner's expected earnings from a partly empty ship. It is a standard concept in voyage chartering and the charter party sets out how it is calculated and claimed. Understanding deadfreight matters to charterers planning cargo quantities (to avoid the charge) and to owners protecting revenue on committed but unfilled capacity.
An owner commits a ship's whole capacity to a charter and expects freight on all of it — if the charterer under-loads, deadfreight makes them pay for the empty space anyway. It protects the owner's revenue and disciplines charterers to book realistic quantities. It is a standard voyage-charter concept that directly affects the economics of a fixture.
When is deadfreight payable?
When the charterer loads less than the full agreed cargo, leaving committed ship space unused; the charterer pays for the shortfall.
Why does deadfreight exist?
To protect the shipowner's expected earnings on capacity that was committed to the charter but not filled.