The amount importers and their clearing agents are paying as demurrage and storage charges at the nation’s sea ports have increased drastically in the port, The Nation can confirm.
Over N80 billion, it was gathered, were lost as demurrage and storage charges by shippers to foreign shipping companies and terminal operators between 2020 and 2022.
The huge loss, the Acting President, Association of Nigerian Licensed Customs Agents (ANCLA), Dr Kayode Farinto said, was due to over-reliance on manual processes and procedures in cargo clearance at the port.
Nigeria’s seaports, he said, received a total of 1,992 ships with an aggregate gross registered tonnage of 60.2 million tons and handled 849,175 TEUs (twenty equivalent units) of container in the first six months of 2022
Additional N40 billion, Farito said, may therefore, be lost by importers and their clearing agents to foreign shipping companies this year, based on high exchange rate, inefficiency and lack of competition among the terminal operators at ports.
The Federal Government, he said, needs to formulate and implement policies that will lead to complete overhauling of port processes from manual to digital to save the country the huge demurrage charges this year.
To reduce the loss, Farinto called on the government to see to the complete overhauling of port processes from manual to digital.
He said that having an automated, digital, and electronic-driven port would put an end to the issue of demurrage and storage charges at the nation”s sea port.
Before, importers, Farinto said, were paying between N8, 000 and N11,000 as storage and demurrage charges, but they are now paying between N11,000 and 14,000 plus 7.5 per cent Cat on every 40ft container.
“When you calculate that amount with the over 849,000 containers that landed in our ports in the first six months of the year and now, you will discover that between N40 billion and N60billion would be lost to foreign shipping companies as demurrage charges,” Far into said.
Other importers who spoke with our correspondent however, lamented that they are finding it difficult to avoid these notorious surcharges because of the high exchange rate and the poor situation of the roads leading to the Lagos ports.
According to a senior official 8n one of the terminals at Tin-Can Island port who craved anonymity: “importers and their clearing agents pay demurrage to shipping line and storage charges to terminal operators when they exceed the use of containers and space they are occupying in the port.”
The amount, the senior official said, continues to add up every day on a per-day basis till the importer or clearing agent removes the container from the space they are occupying in the terminal and delivers the containers back to the shipping lines.
Such high charges are “unjust and unreasonable” for shippers and clearing agents but for shipping lines and terminal operators, “they ensure the efficient use of their containers and the space they have inside the port.”
Investigation conducted by The Nation revealed that the average demurrage charges by the following shipping lines after 14 days for 14ft container in US dollars are: Yangming $719; Maersk $595; CMA CGM $567; HMM $513; ZIM $503; ONE $501; Hapag-Lloyd $465 and COSCO Shipping is $322
It was gathered that Nigeria Container Port Throughput was reported at 1,528,520.000 TEU in December, 2020. This records an increase from the previous number of 1,484,000.000 TEU for Dec 2019. Nigeria Container Port Throughput data is updated yearly, averaging about 1,484,000.000 TEU from December 2008 to 2021.
Most of the containers, according to an importer, Mr Felix Anderson, are stocked in the ports because of lack of necessary cargo handling equipment by terminal operators, lack of fund by some importers to clear their goods on time because of the new exchange rate, closure of some section of the road leading to the port, gridlock and lack of automation by many government agencies operating at the port.
A former Executive Secretary, Nigeria Shippers Council (NSC), Mr Hassan Bello said that having an automated, digital, and electronic-driven port would put an end to the issue of demurrage at the nation’s sea port.
According to him, demurrage is an aberration, and it is difficult to understand why people pay N47 billion in one year. “It is a sign of inefficiency and lack of competition. Terminals should compete with one another to raise the bar in efficiency just like in the communication sector. Customs clearance should be as fast as possible and we hope that the e-Customs would help to bring down the turnaround time for vessels and dwell time of cargo,” Bello said.