Anxiety As Shipping Companies Set To Introduce ‘Congestion Surcharge’ On Lagos Cargoes

There are fresh indications that foreign shipping companies in Nigeria are planning to re-introduce what they called ‘congestion surcharge’.  Investigations by Shipping Position Daily showed that the shipping companies blamed the new charge on what they explained as the huge losses that they have been incurring due to the dilapidated condition of the roads leading to Lagos ports.

 Our correspondent also gathered that due to the cargo congestion at the various terminals, the waiting time of vessels have increased, thereby causing shipping companies to pay more on vessel demurrage. 

Justifying the impending increase at an event in Lagos last week, Former Director of Commercial Shipping at the Nigerian Shippers’ Council, Mrs Dabney Shal-holmer told newsmen that the shipping companies and terminals have every right to increase their charges because of the bad state of port infrastructures in Nigeria. 

She said the cause of such increase is not just the port access roads; it is also due to the inability of the port to receive bigger vessels. She said that the port of Lome in Togo has been developed to 17 to 18metres draft, so it can receive much bigger ships, which Nigerian ports are not able to receive. 

She argued that currently, business and efficiency at the seaside is not matching with the landside efficiency, adding that due to the nature of the bad roads leading to Apapa and Tin Can ports, cargoes are piling up at the quay apron and the stacking area at the terminals. 

Speaking further, she said “shipping is a derived demand, if a shipping company wakes up today and wants to increase costs, he is not just increasing unilaterally, neither is he increasing because he does not know what to do, he is following the internationally laid down principles for increase, although they have not been consulting with Shippers’ Council which is the agency responsible for negotiating freight and all other charges”. 

“However, if the time the vessel is using is taking longer because there is no evacuation, who is going to be responsible for the demurrage on the ships and the containers?”

“A congestion surcharge simply means there is a congestion, unless there is no congestion, you cannot argue with the congestion surcharge, such charges are usually slammed when there is an incident and in this case there is an incident because we don’t have roads, cargo is piling up at the quay apron and the stacking area and they are not being moved out or moved in”, she said. 

Shal-holma told the newsmen that already, there is a committee on ground working on the legal aspect of the impending increase.

 “I have done negotiations in this industry for 22 years with the European shipping association. The surcharge is actually a penalty for not doing things right and for not preparing your environment to receive your cargo, if the environment is not ready to receive the cargo, then don’t call the ship into your environment”, she stressed.

“To a large extent, a lot of the bulk cargoes come to Tin Can and Lagos ports in Apapa where the draft are not sufficient, but there is a lot of innovation going on and we hope that before the end of this year it would change”, she added.