The recent increase in the haulage cost of moving containers from the Apapa port has elicited an uproar, as Nigerians expressed their reservations via social media.
The development is a result of the monetary and implicit cost impact of the recent gridlock on operators, as the increase in the number of shipments arriving at the port, poor road infrastructure and alleged law enforcement breakdown at the port has led to exorbitant payments.
The gridlock has translated to higher detention and demurrage cost of moving shipments at the port, as freight operators painfully haul their shipment from the port terminal.
Haulage cost continues to bite into the profits of the businesses of Nigerians and adversely affect freight companies and port operators, as these entities have to pay huge sums, running to millions of naira, just to move a container from the terminals.
However, the prospects of new investments in this space looks gloomy, with existing operators battling with the astronomical increase in detention and demurrage charges, as the only option of moving shipment by road is a tough alternative, owing to the poor transportation infrastructure and the underdeveloped rail network and high demand for freight logistics services.
This reality continues to mount pressure on stakeholders in the sector and Nigerians in general, as the prices of commodities are hugely impacted.
What they are saying
A number of freights and forwarding business owners have expressed dissatisfaction recently on social media. Gbemi Ola, a Freight Forwarding Businessperson, took to social media to express how disappointing the current situation is. He tweeted,
- “The recent situation at the port has made Nigeria a very unfriendly place to do business and this has limited the prospects of growth in the logistics space, as freight operators pay huge amount of money to forcefully haul their shipment from the port. The cost of trucking a container from Apapa to 10miles away has increased from N150k to N1.3 million.”
Joshua Aribido, another aggrieved Nigerian, tweeted that,
- “At current rates, since the last two weeks till date, the cost of moving a 40ft container from the terminal just outside black gate or National is N1.2Million. To move this same container to Ladipo, freight operators pay N1.8M.”
The operators also disclosed that aside the increase in the demand for freight service and the poor state of transportation infrastructure in the country, security operatives including Nigerian Ports Authority (NPA) security officials, Police and the Presidential task team are responsible for the sporadic increase in the haulage and demurrage cost.
In case you missed it
- Nairametrics reported last week that the haulage cost of moving containers from the Tin Can Island Port terminal increased from N1.2 million to N1.8 million in a week.
- However, the report also revealed that haulage cost of moving a truck miles away from the terminal increased by more than a thousand per cent within the review period, including detention and demurrage costs.