Business

Boost for SGR cargo transport as Kenya receives 50 new wagons

Transport minister Kipchumba Murkomen flags off 50 new wagons at the Port Reitz Freight Station in Mombasa on February 5, 2024. (Photo: X/. Kipchumba Murkomen)

By Ibrahim Omar | Monday, February 5, 2024

This is the first time new wagons have been added since the launch of the SGR in May 2017.

Kenya has received 50 new freight wagons for the Standard Gauge Railway (SGR) with 250 others expected later this month, in what is set to boost the capacity of the SGR to ferry cargo.

Transport Cabinet Secretary Kipchumba Murkomen on Monday dispatched the wagons which arrived in Mombasa from China late last month.

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Twenty of them will have power plugins to enable the movement of refrigerated containers, a hitherto untapped business potential for SGR.

The refrigerated wagons, Murkomen said, will be a big boost to Kenya’s horticultural sector, enabling rail services to respond to the preferences of customers around the world.

“Railway transport is a key enabler of the aspirations set out in our country’s long-term development blueprint, Vision 2030,” said the CS. “My ministry, therefore, will ensure we have the requisite human capital, operational assets and information systems that are geared towards achieving this goal."

This is the first time new wagons have been added since the launch of the SGR in May 2017.

Mr Murkomen said the wagons are part of Kenya’s strategic response to market dynamics and that the move lines up with the need to meet the ever-changing demands of customers and gain a competitive edge in the region.

Kenya is also expecting to receive 20 more SGR passenger coaches, six of which will accommodate people with disabilities, said the CS.

To this end, the country has concluded a cold-chain logistics agreement with its partners in the Netherlands.

Kenyan farmers and exporters have been unable to transport horticultural products – cut flowers, fresh fruits and vegetables – via rail because the locomotives lack the cold storage capability and therefore cannot be used to transport highly perishable produce. As a result, the produce is primarily transported by air.

The addition of the wagons is a big boost to Kenya Railways, which makes much of its money from its cargo business. The parastatal is making the biggest losses by any State-owned corporation in Kenya.

The SGR, however, recorded a 21.2 per cent increase in revenue in the financial year to June 2023, driven by higher cargo haulage and passenger traffic.

The train service made a record Sh18.2 billion in revenue in the period, marking a significant increase from the Sh15.01 billion it earned the previous year.

The CS was accompanied by Kenya Railways Corporation Managing Director Philip Mainga and his Kenya Ports Authority (KPA) counterpart William Ruto.