Importers seek compensation from State agencies over container delays

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By Glenna Nyamwaya

The Shippers Council of Eastern Africa (SCEA) is calling on government agencies to bear the costs incurred by importers following ongoing delays of transferring containers from the Port of Mombasa to the Inland Container Depot (ICD) in Nairobi.

The haulers umbrella body wants the Kenya Railways Corporation (KRC) and the Kenya Ports Authority (KPA) to be held accountable for the delays experienced now costing shippers millions of shillings in charges. SCEA Chief Executive Officer Gilbert Lang’at says that importers have had to forfeit their deposits owing to delays in loading containers from Mombasa and returning empty ones from the ICD in Nairobi.

“Currently as a result of the delays, shippers have incurred container demurrage charges running to millions. This is a lot of money going into charges and it is not sustainable for importers. At times it takes 10 days for a container to be railed to the ICD from the time of offloading at the port,” Lang’at said.

Shipping lines charge a refundable deposit of Sh20, 000 for the 20-foot containers and Sh40, 000 for the 40-foot containers. However, this deposit is only refundable if the containers are returned within 11 days after arrival of the vessel, failure to which a fine is imposed and if they are damaged, a fee is charged.

“We have asked importers to furnish us with information on how much they have paid but so far there are reports that the charges range between Sh510, 000 and Sh2.5 million over the past month,” added Lang’at. Recently, the SCEA had through a media statement expressed the need to have KPA and KRC ensure that cargo is transferred from the port within the shortest time possible failure to which the two agencies bear any responsibility arising from the delays.

SCEA wants the two agencies as well as the regulator the Kenya Maritime Authority (KMA), to come up with a model that will cushion the importers and agents from the exorbitant charges. “This matter should be resolved to cushion importers from further losses,” noted the statement.

The body proposes that KPA and shipping lines start counting the free period days for all cargo when goods land at the ICD and not once offloaded at the port as is the case presently. KPA on its part says that they have set aside a section of the ICD yard to specifically handle empty containers and process their speedy return to the port.

Lang’at further noted that even in its full operation, the Standard Gauge Railway (SGR) would only be able to handle at most 35 per cent of the cargo handled at the Mombasa port. `.

“There is need to incorporate a Truck Queue Management (QMS) system at the ICD to manage trucks to avoid congestion and ease access to and out of the depot,” he said. SCEA also expressed concerns that KRC is yet to upgrade operations to absorb a big bump in cargo traffic due to the government’s directive compelling cargo operators to use the SGR.

The shippers’ body has urged the government to introduce a 24-hour working system for cargo delivery, as well as deployment of more personnel and equipment by relevant agencies in order to lessen delays. Meanwhile, Transport Cabinet Secretary James Macharia recently issued an ultimatum to the Port of Mombasa management and its stakeholders to ensure that hitches facing the smooth running of the SGR freight service are identified and dealt with promptly.

‘’We do not want to be draconian in our approach but if need be, we shall. There are many ways to do this,’’ the CS said during the Mombasa Port Stakeholders 2nd Think Tank Forum. The government recently introduced stringent restrictions aimed at ensuring shippers embrace the use of the SGR freight services that kicked off in January 2018.

Currently, the freight service operates four scheduled trains daily to the ICD each ferrying 108 Twenty Foot Equivalent Units (TEUs), or a total of 432 TEUs. The target is expected to raise this number to six trains daily by June this year carrying 648 TEUs and to 12 trains with a capacity of ferrying at least 1,200 TEUs by December 2018.

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