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Freight Market Update: May 24, 2021

May 27, 2021

Freight Rates: 

Lamu Port Offers 50% Tariff Cut.

In an effort to lure more vessels to dock at Kenya’s second commercial Harbour by cutting tariffs by a whopping 50% of the rates charged at the Mombasa port. Kenya Ports Authority (KPA) halved the cost of pilotage, tug services and mooring for the vessels calling on the port of Lamu.

As it currently stands, ships that dock at the Mombasa port pay 16,200 Kshs to use the KPA pilots to bring ships to the berth, 32,400 Kshs to use the agency’s tug boats and a minimum of 21,600 Kshs for mooring services.

KPA has also lowered the prices of transhipment vehicles, with the first 30 days attracting no charge at all. After the 30 day grace period, shippers will only have to pay 2,160 Kshs and 4,320 Ksh for the 20- and 40-foot containers, respectively.

The Promotional tariff will remain open until May 2022.

Freight Traffic: 

Kenya to use Refurbished Nanyuki Rail to increase Cargo to Ethiopia.

In a statement released by Kenya Ports Authority Chairman General Joseph Kibwana, it was revealed that plans are underway to have cargo destined for Ethiopia transported from Mombasa via the standard gauge railway to Nairobi and then to Nanyuki via the refurbished railway line. 

A meeting is scheduled to occur between the Kenya transport and logistics network and their Ethiopian counterparts in order to agree on the planned movement of the cargo. Should this venture be successful, this will promote trade between the two nations.

General Kibwana went on to add, “Following a feasibility study the plan is viable, and that’s why we want to tap the potential and grow our industrial activities at the border”.

18bn Shs Kibwezi-Kitui road opens up region for Trade.

The soon to be completed 192km Kibwezi-Kitui-Migwani road is already proving it to be beneficial to the region.

The 18.4 billion project, will be jointly funded by the Kenyan taxpayers and the Chinese Exim bank and has reached 90% completion but has already been open for use before its completion.

The Class-B road, which is part of the Mombasa-Isiolo-Addis Ababa transport corridor and will provide a direct link from Mombasa to Addis through Isiolo and Moyale. This road is meant to decongest the Nairobi-Mombasa highway and open up Ukambani for further development. 

Part of the goals of the project include sprucing up Kibwezi and its surrounding townships, many of which will be receiving a water drainage system and tarmacked feeder roads for the very first time. 

Shipping and logistics have established that plans to install a Lorry park around Kibwezi township have reached an advanced stage.

The Lorry park will serve as a resting point for trucks in transit along the new road and will spur the emergence of new business opportunities throughout the region.

Uganda, Kenya team up on old meter gauge rail project eyeing Congo, South Sudan.

There is renewed vibrancy in the Northern corridor with an eye on the growing markets in the Democratic Republic of Congo and South Sudan.

Uganda and Kenya have joined forces to push for the rehabilitation and seamless connection of the old meter-gauge railway line, over which officials from the two countries met to map out operational details.

Kenya is already in the process of revamping the railway line from Naivasha to Malaba and wants a reliable mode of transport for onward transit of cargo.

Besides infrastructure logistics, Kenya is also eyeing the USD 92.3 Million Congolese Market for its infrastructure goods and is keen to see a link with Uganda actualized in the shortest amount of time possible. 

A meeting was held between leaders from the two nations and China Roads and bridge corporation to rehabilitate the Malaba-Kampala railway line. 

This new partnership enables the two countries the ability to dominate markets beyond their borders after years of failure to build a Northern corridor standard gauge railway for Kenya, Uganda, Rwanda and South Sudan.

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