Spedag Interfreight Kenya (SPIF) Limited is a transport and logistics company specializing in logistics services such as supply chain management, project support services, humanitarian aid and relief logistics, customs clearance, air, sea and road freight, inland terminals, oil and gas transportation, warehousing and the development of distribution concepts. Spedag has an operational presence in all five of the East African Community countries.
Launched in September 2015, Spedag Kenya with the help of a Logistics Innovation for Trade (LIFT) Challenge Fund grant will implement their project to develop the current Malaba Railway Yard into an intermodal cargo transfer facility that will be capable of handling, storing and consolidating cargo from rail to road and vice versa. This will result in reduced logistics costs as the facility will enhance cross-loading services to East African Community (EAC) enterprises using the Northern Corridor route – e.g. cargo will be transported by rail from the port of Mombasa to Malaba where it will then be transferred onto trucks for onward transportation by road to other final destination locations within East Africa. At the same time, goods from different East African countries can be transported by road to the Malaba facility before being transferred onto trains and transported by rail to Mombasa. This will broaden the transport and logistics options that are currently available to shippers, thereby introducing more competition and reducing logistics costs and improving efficiencies.
The intermodal facility will also act as a common-user facility by integrating the two modes of transport (rail and road) along the Northern Corridor countries of Kenya, Uganda, Rwanda, Burundi, DRC, and South Sudan. The common user facility will be operated at competitive rates, approximately 20% below the current standard freight handling charges, resulting in a significant reduction in logistics costs. The facility will reduce the transit time of rail-bound cargo and road transport costs for cargo from Mombasa destined to South Sudan, DRC, Rwanda and Northern Uganda by 20%; from 10 days to 8 days when handled through the proposed intermodal facility. It will also potentially increase the volume of export goods transiting the Northern Corridor. Exports that will benefit from the project include coffee, cocoa beans, cotton and timber, while the new facility will create new options to exploit market opportunities for minerals such as vermiculite.
The project’s aim is to expand the freight handling capacity at the border post in order to increase productivity to match improvements in pipeline railway capacity and address the requirements of the oil and gas industry. The improved infrastructure will support the recently introduced single window customs clearance processes for transit cargos, which was designed to facilitate trade in the East African Community. Further benefits from this initiative include moving more freight from road onto rail thereby reducing pressure on the road network. The project will also provide an opportunity for small and medium trucking enterprises (SMEs) to provide short-haul capacity to and from the facility.
“In todays’ global economy, intermodal facilities have become increasingly popular as a method of increasing efficiency and decreasing costs across the entire spectrum of supply chain operations. This said, SPIF’s proposed intermodal facility at Malaba Railway Yard aims to bring transport and logistics handling operations within the East African Region into line with best practices in the global economy.”
– Heinz Mueller, Resident Managing Director Spedag Interfreight.