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Apapa ports are most expensive globally

Wednesday, 25 July 2018 | 16:00

Globally, the cost to ship cargo or freight by a shipping container from the United States to Apapa (Nigeria) is about the highest in the world.

This is according to in a 2018 Overseas Cargo and Freight Costs template showing freight costs from United States (Los Angeles & New York) to different port destinations of the world.
The rates which are as accurate as of early 2017 shows that the Apapa port from New York is the most expensive destination among the countries included in the template. It costs about $4,982 to ship a 20 feet container from New York to Apapa which is about twice the amount to ship a container of the same size to Cape Town (South Africa) – $2,542.

Shipping a 40 feet container from New York to Apapa has a freight cost of about $7,436 almost double the cost of shipping a container of an exact size to Cape Town ($3,795).

Although shipping costs from Los Angeles to Apapa is a bit cheaper, the freight costs to Nigeria is the second highest globally which is about $3,027, a little behind the most expensive freight cost of $3,573 to Saudi Arabia for a 20 feet container.

For a 40 feet container, it costs $4,519 to Apapa and $5,333 to Saudi Arabia from Los Angeles. Freight costs to Cape Town from Los Angeles are found to be approximately $2,276 and $3,397 for a 20 and 40 feet container respectively. This higher cost to Lagos is despite the fact that New York to Lagos is just 6,516 nautical miles and will take approximately 27 days for a ship to sail the distance, while the distance between New York and Cape Town is 9,097 nautical miles and takes a ship approximately 38 days to sail the distance.

A probable reason for the higher costs to Apapa ports as compared to other ports in the world is the inefficiency embedded in the sea port operations at Apapa. The average turnaround time for ships at Apapa is estimated in excess of 30 days showing grave inefficiency as compared to an average of two days for the most efficient ports globally.

“The economy of Apapa is estimated to generate over N20 billion per day,” said Paul Gbadedo, group managing director, Flour Mills of Nigeria.

Despite the huge contribution from the N7.3 trillion Apapa economy, the access to the ports has actually shrunk which is evident in the gridlock caused by tanker drivers seeking to get into the ports to load their containers.

Meanwhile the search for a lasting solution to the gridlock around Lagos, and Apapa in particular, continued on Monday, with the Lagos State government resolving not to grant any further approval for the development of petroleum tank farms within Apapa and its environs going forward.

The state government, in collaboration with other stakeholders, also issued a 30-day ultimatum to existing tank farm operators in the area to secure loading bays for trucks doing business with them or incur the wrath of government. The Department of Petroleum Resources (DPA) has been given the responsibility of monitoring the compliance of the tank farm owners with the directive.

The resolutions were reached at an extended meeting involving many stakeholders in the maritime and transportation sectors, including Nigeria Ports Authority (NPA), Nigerian Shippers Council, tank farm owners, DPR, security agencies as well as clearing and forwarding agents at Government House, Alausa, chaired by Governor Akinwunmi Ambode.

The state government pledged to accelerate and complete work on the Bola Ahmed Tinubu Trailer Park at Orile within the next one month, to accommodate some of the trucks.

Ladi Lawanson, the state commissioner for transportation, who briefed correspondents on the resolutions reached at the meeting, which lasted over three hours, said all stakeholders resolved to work together to bring back sanity to the Apapa axis, as well as agreed on sanctions against operators that would flout the resolutions henceforth.

Lawanson, who was joined by Hadiza Bala-Usman, managing director of NPA, Tunji Bello, secretary to the state government among other stakeholders, said that a joint security task force had been constituted by the federal and Lagos state government and would work continuously for 30 days to bring sanity to the roads, while sanctions slammed on shipping companies for non-compliance on utilisation of holding bays in the ports had been extended by five days.

He said to also cushion the effect on the congestion experienced by motorists in the area; the Federal Ministry of Power, Works and Housing would immediately commence palliative measures on bad portions on access roads.

“The DPR is to ensure that tank farm owners fully comply with holding bay requirements, while trailers not called upon and found trampling will be impounded and sanctioned in Lagos.

“With immediate effect, Lagos State government suspends the approval of tank farms and the government is going to accelerate the completion of the Bola Ahmed Tinubu Trailer Park and it should be ready within a month,” Lawanson said.

The state government also directed that all truck and tanker owners must be duly registered and well regulated by their unions, adding that the unions would be held accountable for their adherence to extant rules and regulations.

“The NPA in collaboration with the Lagos State government will going forward license trailer parks whereby only trucks housed in those designated parks will be granted access. Furthermore, tank farms without adequate loading bays within the next 30 days will be sanctioned.

“These resolutions were arrived at and agreed by all parties and all parties have resolved to jointly implement these resolutions and the effects will be seen by Nigerians very shortly,” the Commissioner said.
Source: BusinessDay

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