Vessels Delay: Importers Pay N47.3b Demurage To Foreign Shipping Companies Annually

Importers and Shippers pay an average  demurrage of $30,000 (N9.5million at a prevailing rate of N315/$) to foreign Shipowners on vessels that call at Nigerian ports daily.

The Foreign ships that berth at the nation’s seaports incur a demurrage  of $7,500 (N2.4million at a prevailing rate of N315/$) per hour to officials of government agencies who perform statutory checks on vessels that berth at Nigerian ports.

With a standard time for such inspections should not be more than one hour but stakeholders have alleged that a vessel can be delayed for as much as four hours ($30,000). during these statutory inspections before stevedoring are allowed to work on the vessel.

With an average of 5,000 sea-going vessels calling at Nigerian ports in a year, this could sum up to N47.3billion on an annual basis

The government agencies who performed inspection and rummaging for immigration control, port state control and enforcement of government fiscal policies includes the Nigeria Immigration Service, Quarantine Service, Port Health, Nigeria Customs Service among others  .

It was revealed that four hour delay could cost a shipping company as much as $30,000 and only one out of about 300 vessels delayed would eventually have issues with the inspection agencies.

The loss incurred by this shipping companies are transferred to importers who have cargoes on the ships while the importers transfer to final consumer with the Nigerian economy at the receiving end.

Stakeholders have advised that vessels discharge should be allowed to commence immediately a ship berths while the inspection officers perform their duties.

Speaking about the delay recently, the Manager, Operations and Logistics, Sharaf Shipping Agency Limited, Jamiu Ogunsola said bottlenecks pose serious challenges and hinder the smooth operations of Shipping Agents in the discharge of their responsibilities.

 Ogunsola said the most challenging issues confronting Shipping Agents in the Nigerian maritime industry would be government officials and their selective interpretation of the law and the resultant delay they cause for vessels.

Ogunsola alleged that Immigration officers were especially culpable in this regard as they tend to stray from their original mandate.

He said “As Shipping Agents, we try to obey all regulations and comply with international best practices, but government officials, especially the Immigration personnel, tend to frustrate our efforts. When they board a vessel, they begin to look for errors and trouble where there are none. They also administer punitive measures for what should ordinarily attract correction; and at that point there are no authorities to report such issues to.”

Ogunsola, who stated that as a representative of either a charterer or cargo owner, the Shipping Agent is caught between complying with the laws of the land and pleasing the Ship Master who is his source of livelihood.

He urged regulatory bodies in Nigeria’s maritime industry to provide complaints platforms to enable stakeholders report violations and issues that may arise onboard between their personnel and Shipping Agents.

“The Agencies should have representatives on ground at all points of contact and develop a Standard Operating Procedure for resolving issues that arise between a vessel and authorities in Nigeria. Even in the ports, you cannot get quick response to issues that need to be resolved,” Ogunsola pointed out.

The Managing Director, Shihab Shipping, Babatunde Shittu said the government agencies who board the vessels look for fault where there is none.

He said government agents raised spurious allegations to extort money from crews in the vessel.

His words, “I discover that most of these government agencies bring up spurious allegations against the crew to extort money from them. Most of them don’t have experience about shipping because if they do, they won’t delay vessels  unnecessarily,” he said.