Shippers lose Sh500m over delays at port

Inefficiencies in cargo handling have forced shippers to pay detention charges of up to Sh500 million this year.

The Shippers Council of East Africa chief executive Gilbert Langat said the huge cost is as a result of delays due to system failures and a “lot” of time taken in verification and inspection.

“It takes about 14 days for cargo to be inspected. We are given four days as cargo owners to clear at the port, so basically all the cargo that is targeted ends up attracting storage, demurrage and a lot of penalties,” he said in Mombasa.

“We pay a deposit for the container. The detention charge will actually be paid from the deposit you put in place.”

He said shipping lines give shippers a period to offload the cargo and return the empty container.

“If you do not return it within that specific period of time you will pay what we call detention charges," he said.

“When a system goes down even for an hour the impact is huge. You cannot clear the cargo, you are not going to load or identify the cargo targeted for verification.”

He said the shipping lines only benefit when the container is in circulation .

Mr Lang’at, who was speaking at the sidelines of the Shippers Council of East Africa and COTECNA PVOC COC workshop, urged government agencies and shippers to work seamlessly to reduce the delays.

“Government agencies must wake up. We are operating in a global environment where we need to be competitive,” Mr Lang’at said.

He said the recent crackdown of illegal goods has led to a lot of containers being targeted for verification.

“When this issues arise then the government agencies will be targeting more cargo for inspection. When that happens the capacity of our port in terms of efficiency is affected,” he said.

“In the last couple of months we have seen an upsurge in the number of cargo containers that are targeted. It is important for us to engage our members and know where the cargo is coming from. We want to deal with this issue so that we do not have delay.”