Haulage Firms Lament Rate Crash At Lagos Ports
Haulage companies operating at the Apapa and Tin-Can Island Ports are facing increasing financial pressure following a sharp decline in haulage rates, with operators struggling to meet bank loan repayments and other financial obligations.
The decline has been attributed largely to delays in the arrival of vessels at Nigerian ports following attacks on commercial shipping in the Red Sea, the Bab al-Mandeb Strait and the Gulf of Aden by Houthi militants.
Findings showed that the cost of moving a container from Apapa Port to Ikeja, Lagos, which previously stood at about N500,000, has dropped to N250,000.
Similarly, haulage from Apapa to Sango in Ogun State, which used to cost about N700,000, now attracts between N350,000 and N400,000, while the rate for transporting containers from Apapa to Ibadan, Oyo State, has fallen from about N900,000 to between N450,000 and N500,000.
Speaking on the development, the General Secretary of the Association of Maritime Truck Owners, Mohammed Sani, said the decline in haulage rates was largely a result of the forces of demand and supply.
Sani explained that haulage rates typically rise when there is a surge in import activities and a corresponding increase in demand for trucks. However, when import volumes and demand for trucks decline, operators are forced to reduce their rates to secure available jobs.
He said attacks on commercial vessels had resulted in shipping companies taking longer routes to reach West African ports, thereby delaying vessel arrivals and reducing the demand for trucks at Nigerian ports.
“Due to attacks on commercial shipping by Houthi rebels, ships are taking longer routes to get to West African ports, including Nigerian ports. This is causing delays to vessel arrivals and ultimately leading to lower demand for trucks,” Sani said.
He noted that the situation had forced many haulage operators to accept rates that were barely sustainable in order to remain in business.
“It is because of a situation like this that AMATO has been advocating unified, harmonised rates for haulage businesses at the ports,” he said.
According to him, the Nigerian Shippers’ Council, now the Nigerian Ports Economic Regulatory Agency, had previously concluded plans to introduce harmonised haulage rates for operations at the Eastern ports, but the proposal was rejected by freight forwarders.
Sani also expressed concern over the financial burden facing truck owners, noting that many operators had obtained bank loans to finance their businesses and depended on regular jobs to meet their repayment obligations.
“Haulage business is all about turnaround because if you don’t get jobs, you won’t be able to meet your revenue target.
“Most truckers run on bank loans, and to meet this financial obligation, you must get jobs. That’s why when truckers’ demand falls, every haulage operator struggles for whatever is available.
“This is why haulage cost has gone down. Everybody is struggling to survive economically,” he added.
The AMATO official therefore urged the Nigerian Ports Economic Regulatory Agency to revisit the issue of harmonised haulage rates as a means of protecting operators from unhealthy competition and ensuring greater stability in the port trucking sector.
