Shipping & Logistics

Truckers hit as cargo volumes decline at Mombasa port

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Trucks at the Port of Mombasa. FILE PHOTO | NMG

A decline in cargo at the port of Mombasa has hit freighters who have seen 40 percent of the trucks parked due to lack of business.

The slowing demand for ferrying cargo has also affected freight charges with the cost of transport to Kampala dropping by 17 percent, according to the Kenya Transporters Association (KTA).

KTA chief executive officer Dennis Ombok said they are now charging as low as $2,000 down from $2,400 with the decline attributed to sluggish demand.

Mr Ombok said there has been a decline in volumes of cargo at Mombasa port in recent days, cutting down on the number of trucks that are required to transport the goods.

“The volumes of cargo at the port have gone down and now most trucks have been parked due to lack of business,” Mr Ombok said in an interview with the Business Daily.

Kenya Ports Authority acting managing director Rashid Salim said the fall in cargo has been occasioned by the effects of the Covid-19 and a shortage of containers that have affected the shipping industry across the world.

“We are still working on the numbers but a decline probably would be the effects of the Covid-19 and a shortage of shipping containers globally,” said Mr Rashid.

The cargo business had started picking between October and December 2020, when the port realised improved performance.

According to KPA, the total throughput within this period not only recovered but also surpassed the forecast target by 2.8 percent and 1.2 percent against 2019/20 performance.

Data from KPA indicated container traffic dipped by four percent to 1,359,579 twenty-foot equivalent units (TEUs) in 2020, from 1,416,654 TEUs recorded in 2019.

KPA said the marginal decline was attributed to global lockdowns that disrupted business.

“The impact of the Covid-19 pandemic on the economy is reflected in the 2020 port performance which was also 2.8 percent less than the forecasted target," KPA said last month.

The KPA data showed the port handled a total of 34.44 million tonnes of cargo in 2020 compared to 34.06 million tonnes handled the year before.

Covid-19 pandemic, which is still rampant in Europe and America, has contributed to the shortage as shipping containers are not returning to China due to drastic reduction of China's imports.

A global surge in demand for certain goods during the pandemic has upended normal trade flows, stranding empty cargo containers and leading to bottlenecks, according to Reuters.

The cost of shipping a 40-foot container from China has gone up to Sh550,000 from Sh330,000 in December, according to a traders lobby.

Traders have attributed the sharp increase to a global shortage that has seen countries across the world grapple with getting empty containers for use.

A significant percentage of goods on the shelves of retail stores in Kenya are shipped in from China and other Far East countries.

These goods include electronics such as mobile phones and television sets and their accessories, utensils, furniture, electrical appliances, clothes and prefabricated buildings not to mention capital-intensive ones such as heavy machinery.

Kenya is hugely reliant on China for basic household supplies.