Congestion and long cargo dwell time in Nigerian ports
Cargo dwell time in Nigerian ports is increasingly assuming a worrisome dimension as importers continue to spend longer days to clear their consignment out of the ports due to man-made obstacles as well as bureaucratic bottlenecks. As it is, from almost all the seaports in Nigeria, importers are compelled to clear their consignment within an average of 21 days (three weeks) or more, which brings to the fore the fact that the 48-hour cargo clearance policy of the Federal Government is not being implemented by all the players in the logistics supply chain.
Meanwhile, in other international ports in the world, including neighbouring West African ports, it currently takes a space of three to five days clear a consignment.
Ironically, since the era of port concession, most of the private terminal operators have invested millions of dollars into developing infrastructure and acquiring sophisticated cargo-handling equipment in their ports to ensure efficiency. Some of the terminal operators have also gone further to grant about 50 to 70 percent waivers on storage charges to importers of overtime cargoes to encourage them to come forward to clear their cargo. Only few importers, however, have come forward to make use of the waiver window to clear their consignment.
Findings show that the length of days it takes an importer to clear and take delivery of consignment in Nigerian ports has put businesses and multi-million dollar investments in the ports at risk of being crippled by the looming port congestion. This is as almost all the terminals in the Lagos pilotage district – which include APM Terminals Apapa, Tin-Can Island Container Terminal (TICT), Ports and Cargo Handling Services, Five Star Logistics, among others – are currently filled to the brim as the dwell time of cargo continues to increase.
Specifically, Nigerian ports, unlike other ports in the world, are not running 24-hour operation as directed by the presidency and handed over to port operators and agencies at the port in 2012 by Ngozi Okonjo-Iweala, minister of finance. According to findings, while terminal operators run on 24-hour basis, officers of the Nigerian Customs Services (NCS) and other government agencies in the ports do not. This contributes to delay in cargo clearance.
It was also discovered that when the terminals are over-utilised, shipping lines find it difficult to stem containers to off-dock facilities so as to reduce the number of containers occupying space for stacking laden containers in the port.
Apart from this, over 2,000 TEUs of overtime and abandoned cargoes are currently left in some terminals at the ports without being transferred to Ikorodu Lighter Terminal or any other approved government warehouse by a team of the Nigerian Ports Authority (NPA) and the Customs.
On the other hand, it was also discovered that some importers and clearing agents contribute to the long cargo dwell time at the ports. Some importers systematically delay coming forward to clear their cargo in an attempt to use the port as a warehouse rather than a transit point.
BusinessDay further investigation shows that effective movement of cargo in and out of Nigerian ports is also being constrained by poor transportation infrastructure in the ports. Cargo throughput in Nigerian ports grows by a margin of 10 to 12 percent annually, but NPA is still making use of the old port gates that have been in use since the 70s when the ports were built. This further constitutes a bottleneck that slows down traffic and contributes to congestion.
Also, over 90 percent of the trucks that move cargoes in and out of the ports are in a very bad condition and due for phasing out. This is why a good number of trucks are found either upturned or abandoned in a bad state on the port access road.
A cross-section of industry close watchers who spoke to BusinessDay are of the view that all the operators in the logistics chain need to deliver 24-hour service to enable Nigerian ports achieve timely delivery of cargo. According to them, if agencies and operators involved in cargo clearance at the port do not urgently address the issue around long cargo dwell time, congestion may set in, further increasing the already high cost of doing business at the ports.
Tony Anakebe, managing director, Gold-Link Investment Limited, a clearing and forwarding company, who confirmed that the dwell time of cargo was increasing by day, also said that Nigerian port industry could not afford to go back to the days of congestion.
According to him, port congestion spelt doom for importers, shipping companies, terminal operators, and the Nigerian economy as whole. He attributed the situation to the fact that freight charges would increase if turnaround time of vessels increased as well.
“The economic implication of this is that importers would pay for the additional cost that would be transferred to the end user in the form of high prices of goods in the market,” he added.
No doubt, Nigeria needs to stem the looming congestion by looking inward into the issues raised, especially ensuring that all the players in the logistics chain do the needful towards reducing the days it takes to clear and move cargoes out of the ports.