Shippers to pay more for road haulage as rates rise by 40%

…Stakeholders call for quick revival of rail system to cut transport cost

Exporters and importers across the country will in the next three weeks start paying more to lift their cleared consignments from the seaports to the importers’ warehouses, following the resolve by association of truck operators to carry out upward review of haulage rates.
The new haulage rate, detailed to take effect from April 1, has significant adjustments with high cost implication on importers, such that cargo movement from the seaports in Lagos to any warehouse within Lagos and outside Lagos, were reviewed upward, arriving at over 40 percent increment.
For instance, to move a truck load of general cargo from the Lagos ports to any warehouse within Lagos State, now costs from N80,000 to N150,000; N60,000 to N140,000 for a 20 foot container; N100, 000 to N170,000 for two 20 foot containers, and N80, 000 to N140, 000 for a 40 foot container.
The cost of freighting consignments by road to other states varies according to distance, size and weight of the cargo.
For instance, a Kaduna-based importer who used to pay about N300,000 to move a container to Kaduna, would be required to pay N480,000 to move a 20 foot container from Lagos to Kaduna and N500,000 for a 40 foot container. Taking containers of similar sizes to Nnewi in Anambra State cost N330,000 and N350,000 respectively per unit, while going to nearby Ile- Ife in Osun State, ranges between N180,000 and N200,000.
On why the adjustment in rates, especially at this time of dwindling business at the ports, Kayode Odunowo, chairman, Joint Council of Seaport Truck Operators (JCOST) said the nation’s present economic realities and the high cost of doing business in the industry, have necessitated the review of haulage rates by the Council.
According to Odunowo, the council arrived at the new template after exhaustive investigations, research and deliberations which established that only adjustment in tariff would enable truck operators keep their heads above the water.
Tony Anakebe, managing director of Gold-Link Investment Limited, a Lagos-based clearing and forwarding company, said Nigerian importers would be forced to pay dearly to move their cargoes from the seaports to the hinterland,as well as for export from the hinterland to the seaports.
Anakebe noted though, that adjustment in the haulage rates had become inevitable, judging from the skyrocketing price of diesel and cost of maintaining trucks, affected by high cost of spare parts. “The market price of spare parts has increased in the last one year, apparently due to high foreign exchange rate, inflation and shortage in dollar supply. At the end of the day, every cost goes back to the importer, who transfers such cost to the consumers of the imported products by increasing the price of goods”
Emma Nwabunwanne, a Lagos-based importer, who lamented the adjustment in haulage rate by truckers, said there has been a significant rise in the cost of doing business at the port in recent times. According to him, shippers were the worst hit by the instability in the foreign exchange market, as well as dollar shortages. He added that the upward review of rates, would only incur more cost for businesses.
“This is the aftermath of the ineffectiveness of the nation’s railway system, which compels businesses to pay high cost to move their cargoes from Lagos seaports to the hinterland by road.
“For instance, shippers moving 30 tons of goods from Lagos to Kaduna by road would be paying between N480,000 and N500,000 which is more than N14,000 per ton, while moving the same volume by rail cost about N240,000, showing that haulage of cargo by rail saves cost for businesses,” he stated.
“In recent times, the Federal Government has been making plans to divest by concessioning the railway system to private operators, which is at the bidding stage. There is a need for government to expedite action on the planned divestment because time has come for the Federal Government to fully involve the private sector in the development and management of the railway system,” he added.
Jonathan Nicole, president of the Shippers Association of Lagos, blamed the increase in the cost of fuel and diesel, as well as high inflation rate, which currently stands at 17. 8 percent, for the upward review of transportation fares.
Nicole, however, called on the Federal Government to be proactive in reviving the railway system. “The poor state of Nigeria’s rail system is discouraging businesses from relying on rail to move their import and export cargoes. This is because the state of the rail limits the turnaround time, such that a journey of four days in most cases takes over one week to be completed due to issues relating to poor maintenance of either the tracks or existing rail wagons.”

 

AMAKA ANAGOR-EWUZIE