Covid vs Freight Costs in East Africa
When discussing East Africa in terms of Logistics, The Shippers Council of Eastern Africa (SCEA) has identified the key trading routes in the region. They are; the Port of Mombasa, Rwanda, South Sudan, Uganda, DROC (Democratic Republic Of Congo) and Burundi.
The East African region is inter-reliant ,in that, a majority of the countries in question are landlocked. Thus many rely on bulk freight imports through their neighbors’ sea ports and via road transits. Additionally, this is mainly because air freight is quite expensive and limited in capacity. Although, it is still utilized, but particularly for more delicate or urgent products.
However, the regulations put in play after the Covid-19 outbreak waves, have led to an increase in freight charges within the region. The cost of both the 40ft and 20ft containers have increased significantly in each area, except for Tanzania.
This is credited to the fact that Tanzania, at the beginning of the outbreak, did not set up the same stringent restrictions as Rwanda, Kenya and Uganda. As such, they were able to standardize their charges for a significant amount of time before the severity of the different waves of the pandemic forced them to take similar measures.
Post Covid Freight Costs East Africa
According to The Star’s Martin Mwita the freight costs have gone up as stipulated below :
NB: Uganda is the biggest destination for transit cargo along the corridor, it accounts for about 83.2 per cent of total transit volumes.
- Mombasa to Kampala increased from $2,200 (Sh238,150) in the pre-pandemic period to $2,500 (Sh 270,625 ) per container. This was for both 20 and 40 foot, which extended into the first half of this year.
- Moving containerised goods to Kigali from Mombasa also increased from $3,400 (Sh 368,050) to $3800 (Sh 411,350). This is pegged mainly on the delays along the corridor ,and especially at the ports of loading and the exit borders.
- Mombasa to South Sudan increased to $4,500 (Sh487,125 ) from $3,600 (Sh 389,700) .
- Moving a container to DRC went up to $6,000( Sh649,500 ) between March and June this year, from $5,000 (Sh 541,250).
- Nairobi and Zambia increased to $7,000 (Sh757,750) from $6,000 (Sh 649,500 ), with transit time increasing to an average 30 days from 10-12 days.
The Inland Container Depot, Nairobi (ICDN) has been a clear indicator of the issue at hand. Usually there is a four-day free period for containers to clear, after which, they are forced to incur storage fees.
Stay tuned to our Globeflight Kenya blog for more updates and info from the logistics sector. We are your go to logistics guys in the seas or the skies!