Kenya's railways commercial freight business stalls before it even starts due to cargo shortage
The new railway was expected to haul a huge chunk of containers and take pressure off busy and congested Nairobi- Mombasa highway.
Kenya Railways has been forced to delay the daily service after cargo shortage hit the SGR’s goods haulage business.
The second cargo train that was expected in Nairobi on Wednesday was still stuck at Mombasa port awaiting containers despite increased imports via Kenya’s sole sea port, Mombasa port.
“The second SGR freight train, which was expected to come to today (yesterday), is not full. We will let you know when it will arrive in Nairobi once it’s full,” said a Kenya Railways official who sought anonymity given the sensitivity of the matter.
On Monday the first cargo train hauling 104 containers, which is almost equivalent to the trucks operating daily on the Mombasa-Nairobi highway arrived at Nairobi inland container depot and it was expected the business would automatically then take off.
The shortage has raised fears that investors may still be opting for road transport despite SGR offering cheaper prices and booming business at the port of Mombasa where Imports account for more than 80 per cent of the cargo or a daily average of 2,000 containers.
According to Kenya Railways statement, it costs Sh50,000 ($500) to ferry a 20-foot container from Mombasa port to the Nairobi inland container depot (ICD).
Truckers on the other hand charge between Sh60,000 and Sh80,000, ($600 – 800) depending on the weight and type of cargo.
Some stakeholders however say cargo owners will have to spend between Sh15,000 and Sh20,000 on the last mile transport to industries within Nairobi depending on the distance from an ICD, casting doubt on the affordability of the SGR freight business.
Mombasa port has in recent years witnessed increased traffic, helped by an expansion of its handling capacity.
It handled 22.8 million tonnes of cargo between January and September compared with 20.6 million in the same period last year.
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