Kenya Freight Transport Report

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Providing expert analysis, independent forecasts and competitive intelligence on the freight transport industry.

Report includes: BMI Industry View, Industry SWOT Analysis, Industry Forecasts, Freight Transport Risk Reward Index, Macroeconomic Forecast, Company Profiles and Regional and Country Industry Overviews.

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Kenya Freight Transport Report
Product Price
$1,295.00

Although Kenya's GDP will continue to grow through 2016 and into the medium term, trade growth figures will start from a weak position with both imports and exports shrinking until they recover into positive growth in 2017. That said, the major transport sectors will remain in positive growth over the entire period, buoyed up by investment and a growing economy.

Despite increasing headwinds, economic growth in Kenya looks to be picking up. Data from the Kenya National Bureau of Statistics showed that real GDP grew by 5.5% y-o-y in Q215 from 4.9% in Q115. Currency depreciation and monetary tightening are still having an effect and should maintain strong growth. In addition, the diversification in the economy has lowered its exposure to a downturn in commodity prices and a slowdown in China and confidence in the country is strong. Sectors such as construction, financial services and wholesale and retail trade have been buoyed by resilient domestic consumption and government spending on major infrastructure projects.

Industrial growth in sectors such as agricultural production and manufacturing will ensure Kenya will be one of the fastest growing economies in East Africa. Continuing investment will help to boost exports as well as improve the country's infrastructure, feeding positively into the freight industry by improving efficiencies and capacity.

The dominance of road transport is likely to continue if not increase in the country with growth expected to rise through to 2020. The need for investment in the network is recognised as necessary to reduce congestion and increase efficiency. Rail transport, which plays a small part in the freight mix, is set to undergo some important developments to improve links with neighboring trade partners and improve access to the country's major cities and sea ports. Air freight, which is currently seeing the strongest growth, will diminish in importance in the freight mix, as foreign airlines such as in Ethiopia assert their competitive advantage over the Kenyan players. Some investment in areas such as perishable goods will help strengthen the sector.

Headline Industry Data

  • 2016 Port of Mombasa tonnage throughput forecast to grow by 5.00%.

  • 2016 air freight tonnage throughput predicted to rise by 8.58%.

  • 2016 rail freight tonnage throughput forecast to increase 2.05%.

  • 2016 total trade set for y-o-y real-term growth of 0.28%.

Key Industry Trends

RIFT Valley Railways announces growth in 2014 - the railway company that operates the Kenya to Uganda line announced that its freight traffic increased by 24.3% in 2014, with the Kenya National Bureau of Statistics reporting that the company moved 1.5 million tonnes of freight in 2014, compared to 1.2 in 2013. Investment in new rolling stock has improved performance and reliability and placed the railway in a strong position to compete with the new standard-gauge line planned between the two countries.

Mombasa to Nairobi standard- gauge line - The Kenyan government has announced that it is to allocate a further USD1.4bn from its 2015-16 budget for the construction of the 609km standard-gauge line from the port of Mombasa to Nairobi. The aim of the funding is to encourage the rapid implementation of the project. The additional funding will consist of a loan from China and from the government's own Railway Development Levy Fund.

FSG announces acquisition of South African Transit Freight Coordinators Group - Frontier Services Group, based in Kenya, has announced the acquisition of the business and some assets belonging to the South African company. The move forms part of FSG's pledge to provide a one-stop logistics solution across road, rail and sea for the whole of Africa and should strengthen Kenya's position as a key logistics hub in the region.

Key Risks To Outlook

Updated GDP figures have not led us to significantly revise our outlook for the Kenyan economy, but we anticipate headwinds to affect the Kenyan freight industry owing to weak export growth over the medium term. Achieving 'middle income status' may increase investor interest in the country over the longer term.

The Kenyan National Bureau of Statistics (KNBS) has released an updated measure of Kenya's GDP. The new figures show the country's economy was 25.3% larger in 2013 than had been previously assumed.

The new data show Kenya's GDP per capita exceeded the World Bank's 'middle income' threshold in 2012; an announcement that may increase Nairobi's ability to tap global capital markets. Kenya's wide fiscal and current account deficits are now lower as a proportion of GDP, indicating macroeconomic imbalances are less severe than had been previously reported.

The Kenyan government also signed a Memorandum of Understanding (MoU) with China Communications Construction Company Limited to establish a free trade zone in Mombasa, Bernama reported in August 2014. The link up, which will be Kenya's first free port, should aid the Kenyan freight industry.

BMI Industry View
7
SWOT
9
Freight Transport
9
Political
11
Economic
12
Industry Forecast
13
Macroeconomic Outlook
13
Air Freight
13
Table: 1: Air Freight, 2012-19
13
Maritime Freight
13
Table: 2: Maritime Freight, 2012-19
14
Rail Freight
14
Table: 3: Rail Freight, 2012-19
14
Trade
14
Table: 4: Trade Overview, 2012-19
15
Table: 5: Key Trade Indicators, 2012-19
15
Table: 6: TOP IMPORT DESTINATIONS, 2005-2012, USDmn
16
Table: 7: TOP EXPORT DESTINATIONS, 2005-2012, USDmn
17
Market Overview
18
Industry Trends And Developments
26
Air Freight
26
Rail Freight
27
Road Freight
28
Multimodal freight
29
Maritime Freight
29
Company Profile
33
Kenya Airways Cargo (KQ Cargo)
33
Delmas
36
Political Outlook
39
Long-Term Political Outlook
39
Table: Kenya Political Overview
43
Macroeconomic Forecasts
44
Economic Analysis
44
Table: GDP By Expenditure (Kenya 2011-2018)
50
Demographic Forecast
51
Table: Population Headline Indicators (Kenya 1990-2025)
52
Table: Key Population Ratios (Kenya 1990-2025)
52
Table: Urban/Rural Population & Life Expectancy (Kenya 1990-2025)
53
Table: Population By Age Group (Kenya 1990-2025)
53
Table: Population By Age Group % (Kenya 1990-2025)
54
Methodology
56
Industry Forecast Methodology
56
Sector-Specific Methodology
57
Sources
58

The Kenya Freight Transport Report has been researched at source, and features latest-available data covering commercial transport and logistics by road, rail, air and water; industry forecasts, company rankings covering leading national and multinational operators; and analysis of latest industry trends, opportunities, projects and regulatory changes.

BMI Research's Kenya Freight Transport Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Kenyan freight transport and logistics industry.

Key Benefits

  • Benchmark BMI's independent freight transport industry forecasts on Kenya to test other views - a key input for successful budgetary and planning in the strategic freight transport market.
  • Target business opportunities and risks in the Kenyan freight transport sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Kenya.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs, and latest activity).

Coverage

BMI Industry View

Summary of BMI’s key industry forecasts, views and trend analysis covering freight transport and logistics, regulatory changes, major investments and projects and significant national and multinational company developments.

Industry SWOT Analysis

Analysis of the major strengths, weaknesses, opportunities and threats within the freight transport sector and within the broader political, economic and business environment.

BMI Industry Forecasts

Historic data series (2008-2012) and forecasts to end-2019 for all key industry and economic indicators (see list below), supported by explicit assumptions plus analysis of key downside risks to the main forecast including:

  • Transport Sector: Total freight carried by road, rail, inland waterways, maritime, air and pipeline (mn tonnes-km/mn tonnes).
  • Trade: Exports and imports (USDmn) by category of goods (manufactured goods, food, chemicals etc.); top five import and export trade partners (USDmn); imports/exports to each global region (USDmn)
  • Port Data: Throughput (‘000 tonnes) for all major ports in the state.
  • Oil Products Prices: Price forecasts for gasoline and aviation fuel (USD/bbl) at all major global energy trading hubs.
  • Economic Indicators: Nominal GDP (USDbn); real GDP growth (%); GDP per capita (USD); industrial production (%); unemployment (%)

Market Overview

Details of the freight infrastructure in each state by segment (road, rail, air, water and pipelines). Full analysis of the competitive landscape within each segment.

Industry Trends and Developments

Analysis of the latest projects across the freight transport sector (road, rail, air, sea and logistics) including a market overview which provides an outline of the key elements driving development.

Political Outlook

The Freight Transport market reports contain a chapter detailing the political outlook of a given region, examining the domestic politics, long-term outlook and foreign policy, and assessing the impact this could have on freight and transport businesses.

Company Profiles*

Examines the short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses.

The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

Sources

The Freight Transport reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.