Freight Rates Dip on Low Cargo Volumes at Port of Mombasa

Freight charges from Mombasa to Kampala have dropped by 17 percent on low demand for transport services, in what has seen nearly 40 percent of the trucks under Kenya Transporters Association (KTA) remain idle.

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

Mr Ombok said there has been a decline on volumes of cargo at the Port of Mombasa 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 Sendy.

It is not clear whether the decline on throughput cargo at the Port of Mombasa has been occasioned by the shortage of containers that has hit the global market in recent days or if it could be the effects of the Covid-19 pandemic that continues to ravage global trade.

An official from the Kenya Ports Authority (KPA) said the actual cause and the extent at which the volumes have dropped could not be established immediately.

“It require a little bit of time before we get the numbers and the reasons for the decline, at least by the end of the month we shall have a clearer picture,” said the official.

The cargo business had started picking in the period between October-December 2020, where the port realized improved performance.

According to KPA, the total throughput within this period not only recovered, but also surpassed the forecasted 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 after countries around the globe imposed lockdowns due to the Covid-19 pandemic.

“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 tons of cargo in 2020 compared to the 34.06 million tons handled the year before.

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