Transport

Shippers want KPA, Railways to pay for container delays

kpa

Standard gauge railway. FILE PHOTO | NMG

The Shippers Council of Eastern Africa (SCEA) wants the Kenya Railways and Kenya Ports Authority (KPA) to be responsible for the delays being experienced in transferring containers to the Inland Container Depot (ICD) in Nairobi.

The council said shippers have incurred millions of shillings in demurrage charges as a result of delays to transport empty containers back to Mombasa, adding that the matter should be resolved to cushion importers from further losses.

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Shipping lines charge $200 and $400 as deposit for the 20-foot and 40-foot containers respectively. The refunds are made when 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.

The SGR freight services started in January this year with the service currently running four scheduled trains to the ICD each ferrying 108 Twenty Foot Equivalent Units (TEUs), or a total of 432 TEUs daily. This is expected to increase to six trains daily by June carrying 648 TEUs while by December, 12 trains are expected to operate each day transporting at least 1,200 TEUs.

SCEA executive officer Gilbert Lang’at said due to delays to load containers at the Mombasa port and return empty containers, importers have had to forgo their deposits.

“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 $5,000 (Sh510,000) and $ 25,000 (Sh2.5 million) over the past month,” he said in a telephone interview.

“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,” he added.

Tuesday, KPA General Manager Operations Captain William Ruto could not be reached for comment but in a recent interview, he said they had set aside a section of the yard to handle empty containers.

In a statement sent to media last week, the council also said there was need for KPA and KRC to ensure cargo is transferred from the port within the shortest time possible and.

“KPA and KRC must take responsibility for delays occasioned by the implementation of the SGR directive and direct shipping lines to waive any resultant demurrage incurred by shippers through penalties being imposed by the shipping lines,” he added.

According to Mr Lang’at, the two agencies, including the regulator, the Kenya Maritime Authority (KMA), should also come up with a model that will cushion the importers and agents.

According to SCEA, KPA and shipping lines should start counting the free period days for all cargo when goods land at ICDN. Currently, goods shipped on merchant haulage model are considered to have reached their destination once offloaded at the port, as opposed to those on Through Bill of Lading (TBL) whose destination is marked as ICD.

Mr Lang’at said even in its full operation, SGR would at most take between 30 and 35 per cent of cargo generated at the Mombasa port, and called for operators to cooperate with transporters for smooth running of the service.

“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.