Traders livid as KPA offers transit goods free storage

Trucks waiting for clearance to transport cargo to upcountry at Mombasa port last year.

Photo credit: File | Nation Media Group

What you need to know:

  • The move is viewed by many stakeholders as favouring goods destined to neighbours such as Uganda essentially making them cheaper.

Kenya Ports Authority has declined to increase free cargo storage period for domestic containers, leaving a bad taste in the mouths of local traders.

KPA in a Friday notice extended goods free storage time it had announced in May by another 90 days but still left out domestic importers who have four days to clear them or risk hefty penalties.

The move is viewed by many stakeholders as favouring goods destined to neighbours such as Uganda essentially making them cheaper.

Kenya Shippers Council chief executive Gilbert Langat said the four days’ duration is not even sufficient to clear cargo, setting up Kenyan importers to fines associated with delays.

“This is a matter we had raised to the highest possible level and we had hoped KPA board was going to address it. The turn-around-time at the inland container depot now is about seven days so that means the four days still leave the local importer with a higher bill,” Mr Langat told Nation on Friday.

Free storage

KPA had in May extended the free storage period for those importing cargo for export to other countries from nine to 15 days at the Mombasa port, and to 14 days for those handling at the ICD in Embakasi.

Those handling transit export containers were added five more free days to 20 and those handling transit import containers at the Naivasha ICD were given 30 free days to clear.

The offers have since been extended to November 18 in what KPA acting managing director Rashid Salim termed as a measure to cushion traders against the economic pressures brought by Covid-19.

“Kenya Ports Authority wishes to announce to the general public of extension of free storage period to its customers. This is in line with our continuous and deliberate efforts of cushioning our customers on effects of the coronavirus, which have impacted the whole transport logistics chain,” Mr Salim wrote in the notice.

Traders are surcharged between $30 (Sh3,240) and $90 (Sh9,720) per day for any extra day their cargo stays at the port beyond the free storage period depending on size of the containers.

Cargo owners whose containers have been cleared and released by the Kenya Revenue Authority and not collected after 24 hours pay $100 (Sh10,980 and $200 (Sh21,600) per day for 20ft and 40ft respectively.

Huge relief

Although the longer free storage periods give a huge relief to importers and exporters using the Port of Mombasa after Covi-19 restrictions disrupted cargo logistics, failure to extend the same favour to those importing cargo to sell locally dents competitiveness for local goods and is a recipe for smuggling of the cargo that still land in Uganda cheaper despite transiting through Kenya.

Truck turnaround time for return of empties has increased from an average of 3.5 hours in January, 2020 to 8.9 hours in March, 2020 (figure 5). This can be attributed to waiting time by truck as they line up to offload the empties at ICD.