The Alchemy behind the Mombasa port cargo growth

The Northern corridor is the transport corridor linking the land locked countries of Uganda, Rwanda, South Sudan, Eastern DRC and Burundi with Kenya’s maritime port of Mombasa. It is a multi-modal corridor, encompassing road, rail, pipeline and inland waterways transport.

The main road network runs from Mombasa Sea Port through Kenya and Uganda to Kigali in Rwanda, Bujumbura in Burundi and to Kisangani in the Democratic Republic of Congo. The same network also links Kenya and Uganda to Juba in South Sudan.

The Northern Corridor Transit and Transport Co-ordination Authority (NCTTCA) was established under the legal framework of NCTTA to co-ordinate the implementation of the Northern Corridor Treaty and to carry out decisions and resolutions reached by policy organs of the Authority.

The overall strategic objective of Transport Corridors is to accelerate regional integration and that of the continent by facilitating trade and promoting development of transboundary transport infrastructure and elimination/reduction of Non-Tariffs Barriers e.g. multiple customs documentations, Checkpoints, Infrastructure bottlenecks, statics weighbridges, Border stoppages, Cargo diversions etc.

The Kenyan Port of Mombasa, handles about 65 per cent of the regional transit traffic on the ports annually compared to Dar es Salaam port which handles the remaining 35 per cent. The market for Tanzania is Zambia, D.R. Congo, Rwanda, Burundi, Malawi and Uganda. Mombasa port still remains a port of choice to Uganda due to a difference in distance of about 600 km compared to the port of Dar es Salaam. Uganda commands more than 50 per cent of the regional transit traffic. Dar es Salaam is the preferred port in the transit traffic for Burundi, Rwanda and D.R. Congo because Tanzania has absolute advantage on distance from the coast. This translates to cost advantage as well as time utility. In addition to improving the competitiveness of Mombasa port, Kenya needs to focus on encouraging the formation of Trans-Africa transit traffic and trans-shipment infrastructure to reach out beyond the EAC region.

Part of the Mombasa Port

Some of the notable achievements during the fourth quarter of 2018 include but not limited to: the reduction of cargo dwell time to 82 hours, modernization of the port, and expansion of infrastructure, implementation of standard gauge rail and implementation of the Green Port Policy.

All those efforts translated into an overall improvement of Port performance indicators as well as an increase in Cargo handled.

In June 2018 the port handled throughput of 2,720,000 TEUs representing a 0.6 per cent increase compared to the same month in 2017.

The growth is attributable to an increase in dry bulk and containerised cargo, which recorded an increase of 6.8 per cent and 10.6 per cent respectively.

January to June saw the port register a 2.4 per cent growth in throughput compared to the same period last year. Imports took a lion’s share of the throughput at 83.6 per cent, while exports registered 12.5 per cent. Transshipment cargo recorded 3.6 percent of the total traffic.

The strong freight figures were equally demonstrated by the growth of container traffic. In June, the port registered 106,153 Twenty Foot Equivalent Units (TEU’s) compared to 99,727 TEUs handled last year and posting an increase of 6.9 percent. The cumulative container traffic from January to June saw an increase of 5.3 per cent with the port handling 614,625 TEUs compared to 583,661 TEUs during a similar period last year.

Additionally, June 2018 saw the breaking of two productivity records with container ship – Livorno - registering an average of 140 gross moves per hour to beat a record set a week before by MV Ever Dynamic’s of 129 gross moves per hour. The records surpassed a similar one set in 2015 by MV Kota Lambai’s of 82 gross moves per hour. Gross moves per hour is a maritime productivity term that defines the total container movement (on loading, offloading and repositioning) divided by the number of hours for which the vessel is at berth. In June 2018 an average of 35 gross moves per hour were recorded at the port of Mombasa compared to 28.1 movers per notched up last year.

Average ship turnaround time improved from 135 hours in the fourth quarter of 2015 to 77 hours in the same period 2016. The turnaround time deteriorated to 91 hours in 2017 and further to 116 hours in 2018. However, in June 2018 there was a great improvement in turnaround time to 75 hours against the set target of 72 hours. The positive performance can be related to the implementation of the second container terminal in September 2016, acquisition of more equipment and introduction of fixed berthing window scheme, expansion of terminals, construction of an offshore Single Buoy Mooring and establishment of up to date dry bulk facilities among others.

Ship Turnaround Time is an indicator which is meas­ured from the time the ship arrives at the port area (Fairway Buoy) to the time it leaves the port area. It comprises of the ship waiting time and the ship work­ing time (time when the vessel is being offloaded or loaded with cargo).

Vessel waiting time averaged 41 hours in the fourth quarter of 2018 with the month of June recording the best performance of 13 hours.

Ship Waiting Time before Berth is an indicator which is measured from the time the Ship arrives at the fairway buoy to the time of its first berth. It is a subset of the Ship turnaround time.

Theaverage Cargo dwell time for the period April-June 2018 stood at 89 hours with the month of June recording the best dwell time at 82 hours and the poorest performance of 97 hours was recorded in May 2018.

The implementation of a modernization programmes at Mombasa port has seen improvement in productivity and efficiency of the port. For instance, it can be observed that the average containerized cargo dwell time for the reporting quarter was 114 hours for 2015, 97 hours for 2016, 95 hours for 2017 and 89 hours for 2018. Performance in 2018 quarter represents a marginal improvement of 15 percent (that is the container dwell time was reduced to 3.7 days from the baseline of 105 hours) moving it closer to the set target of 3 days. Kenya Ports Authority (KPA) reported that the improvement was attributed to 24/7 clearance and evacuation of cargo from the port, evacuation of cargo using the Standard Gauge Railway, armouring of electronic cargo tracking system, automation of systems and expansion of exit lanes at the gates. Gate 18/20 was expanded with two additional lanes having been introduced to improve truck turn around.

In addition KPA acquired new cranes to increase volume of cargo transported through rail. However, there is also need to develop and expand parking yard outside the port since at the moment, majority of truck Owners Park alongside the roads causing congestion which contributes to higher dwell time. It is expected that this performance will improve as soon as the processes in cargo clearance are streamlined and sources of delays are identified and addressed including delay areas and parties responsible to each delay.

Average time spent at One Stop Centre reduced gradually from 56 hours in 2015 and 50 hours in 2016 to 47 hours in 2017 and reduced further to 44 hours in 2018 during the quarter under review. The performance is still far against the set target of 24 hours which is a pointer to prevailing inefficiencies and may be partly attributed to late submission and revision of documents by clearance agents and uncoordinated joint verification of cargo targets. Mombasa Port Community Charter (MPCC) committed to attaining this target by undertaking specific commitments including conducting joint verification. Therefore, mechanisms for speeding-up clearance of cargo processes by all the stakeholders involved to realize the required result of one day is important.

The target of 36 hours for the indicator to measure the Delay after Customs Release was also achieved in June 2018, suggesting improvements of roads infrastructure around the Port and the corridor together with the implementation of the Standard Gauge Railways (SGR) are bearing the desired outcomes to improve this indicator. Time taken after Customs have issued the transporters with a release order form authorizing their exit fairly was between 38 hours in April 2018 and 32 hours in June 2018. This as result of improvement in the rate of cargo pick up by transporters when compared to previous years. For instance average time taken after customs release in 2015 reduced significantly from 46 hours to 32 hours in 2018.

However, the Time Taken at the Document Processing Centre (DPC) which is the time it takes to have an entry lodged by a clearing agent passed by Customs, slightly increased from 1.7 hours in April 2018 to 2.5 hours in June 2018. Comparing previous performances for the quarter covering April to June, data shows that average time taken at DPC was not steady.

The average DPC time registered 2.5 hours in 2015, 2.4 hours in 2016, 2.3 hours in 2017 and 2.1 hours in 2018 against the target of 1 hour over the last 4 years. This under performance was attributable to the instability of SIMBA system and the quality of declaration by the relevant agents. Kenya Revenue Authority’s commitment was to establish a system of pre-arrival clearance to clear 70% of the cargo within a span of 48 hours before docking of vessels, within 3 months after the charter signing.

Addressing these challenges will go a long way in improving DPC time.  Among the initiatives to improve the Time Taken at the Document Processing Centre include on the spot approval of manifest, allow partial manifest and simultaneous online submission of manifest. Kenya Revenue Authority is also in the process of implementing the Integrated Customs Management System ICMS which will enhance faster clearance of cargo.