Cargo pile up at Mombasa port container terminal. Kenya Ports Authority has invited bidders to apply for container freight station licenses

More container freight stations will be enlisted to mitigate the cargo congestion crisis at the Mombasa port.The Kenya Ports Authority has invited bidders to apply for container freight station (CFS) licenses in a move that affirms the increasing role that such stations will continue playing in the local cargo handling chain in future.

Firms to be licensed will operate alongside the two leading logistic service providers — Consolbase Limited and Mombasa Container Terminal, which are mandated by KPA to clear containers on its behalf. Apart from the two, there are 11 other container freight stations which specialise in handling group cargo and motor vehicles.

Container freight station is emerging as a major sub-sector in the shipping industry, as shrewd investors steadily move in to cash in on this logistic solution.Though the concept is relatively new in Kenya, those venturing into it say that such terminals have a bright future considering the recent trend of port authorities commercialising cargo handling services.

Over the last five years, 13 firms have ventured into freight stations. These include Awanad, Mitchell Cotts, Mombasa Container Terminal, Kencont, Consolbase, African Liner Agencies, Boss Freight, Siginon, Regional Logistics, Makupa, Kenfreight, Portside and Interpel.

“I think CFS will play a bigger role in future; their role in helping to decongest port during the post election violence is an illustration of the critical role they can play in the cargo handling chain,’’ Mr Mohammed Jama, a director of Interpel CFS told Business Daily.

A Container Freight Station is an extension of the port thus it ordinarily has to operate under customs control and other governmental agencies. It must have the minimum cargo handling and storage facilities.A CFS operates in the same way as an inland container depot (ICD) only that the latter is in most cases located further inland. Their main functions include receipt and dispatch of cargo, loading and offloading of group cargo from containers, provision of transit operations among others.

Their popularity has been boosted by the shipping trends worldwide and a realization by both government and private sector of the great economic benefits accruing from such yards or terminals. Some of these include convenient handling of long distance or transit cargos.The make it possible to bring the customs services near the centres of production and consumption. There is also the efficiency of the yards which leads to less demurrage and pilferage being incurred.

The direct movement of cargo from the Mombasa port to the CFS means such cargo is not subjected to customs procedures at the gate of the port thus saving on time. When the KRA is licensing a CFS it has to take into account factors such as location, facilities, security and equipment, among others.

A nearby railway line is an important asset for CFS developers, but following the poor performance of the Rift Valley Railways in recent times, several of the recently gazetted CFS happen to be kilometres away from Kenya’s lines. Other key facilities include warehouses, gate complexes, cargo handling equipment such as cranes, haulers and trolleys and a premises to house customs and other agencies.

A warehouse is needed to provide storage and working area for non containerized cargo. Enough space is needed to isolate the separate export bound cargo from the imports which are unpacked and distributed to individual owners.A gate complex is required for proper regulation of entry and exit of vehicles carrying cargo and containers through the terminal. It is where documentation, security and container inspection procedures are undertaken.