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Logistics News Update – 14 February 2024

Good morning, Welcome to another Logistics News Update. Happy Valentine's Day         Alarm bells are ringing for South Africa's import and export sectors as shipping volumes plummet to 2018 levels. Service providers brace for a dismal first quarter...

Good morning,

Welcome to another Logistics News Update.

Happy Valentine’s Day        

Alarm bells are ringing for South Africa’s import and export sectors, as shipping volumes plummet to 2018 levels. Service providers brace for a dismal first quarter, with concerns that even the rest of the year might not offer enough recovery. This dramatic drop signifies a wider economic slowdown, potentially making 2024 a bumpy ride for all sectors. 

South African Fruit Exports Face Hurdles: Ensuring Preparedness is Key – The South African fruit industry faces several challenges hindering exports, including concerns about citrus black spots impacting European Union (EU) access. While these hurdles are significant, proactive measures can ensure continued export success. One of the largest shipping lines has already offered to load exports for fruit only out of the Easter Cape at a private berthing. 

So the question is, is the port getting better, the answer is compared to? If we compare it to November/December 2023, yes, we are well on the way back to “normal” by South African standards and not international normal. Hope that this answers this very grey area. 

We could do a checklist of what the problems are, but we need to celebrate the successes and we are on the right track. 

Let’s look at the port updates:

Freight BUSA – SAAFF

How to read the above:

Port:                             Self-explanatory

Vessels:                        All the vessels, not just container vessels, in this one, there are 10 container vessels outside the port of Durban

Resources:                    What they need to bring the vessel in. (the helicopter is to bring the vessels in)

NEWS

Logistics reforms cannot be rushed: 

Transnet acting CEO Michelle Phillips

Durban Container Terminal reduces vessels at anchorage

12 Feb 2024 – by Staff reporter

State-owned rail and port operator Transnet has told the government it needs more time and cannot meet deadlines beginning next month in a roadmap to address the country’s logistic problems, its acting CEO said on Tuesday.

Transnet has struggled to provide adequate freight rail and port services because of equipment shortages and maintenance backlogs after years of underinvestment. Rampant cable theft and vandalism have also damaged the network.

Exporters, including South Africa’s miners, say they have lost millions of dollars as a result, with knock-on effects for the economy, but Transnet said trying to rush solutions would not help.

“We are in discussion with the National Treasury and the shareholder on some of the dates,” Transnet acting CEO Michelle Phillips told Reuters on the sidelines of the Investing in African Mining Indaba in Cape Town.

“We have provided alternate dates because if you go to the logistics roadmap, there are a number of transactions with dates, a number of them speak to March this year. It can’t be done by me, and I don’t think we can do it as Transnet.”

Source: Sunday Time

Durban Container Terminal (DCT) Pier 2 has reduced the number of vessels waiting at anchor after boosting operational teams on duty.

DCT said in a statement on Friday that the terminal had maintained single-digit numbers of vessels at anchor, having increased operational teams to 11 per shift on the waterside, reducing congestion in the terminal.

“The combination of employee allocations and evacuation of import containers, averaging 35 wagons daily, via rail to back-of-port facilities, has also enabled fluidity on the landside handling,” DCT said.

At the height of the vessel backlog in November, DCT Pier 2 had 43 491 import containers waiting at anchor, which has now been reduced to1 738.

Durban Terminals managing executive Earle Peters said management was holding ongoing positive engagements with shipping lines and transporters.

“We have benefited greatly from continuously engaging with our customers and partners and heeding their feedback. The transparency is creating a win-win solution,” he said.

Freight News Online

Cape Town and Ngqura receive the first hydraulic tension mooring units

12 Feb 2024 – by Staff reporter

SA-US relationship on rocky ground

12 Feb 2024 – by Staff reporter

The first batch of four hydraulic tension mooring units has been delivered and operationalised at the ports of Cape Town and Ngqura to improve operational efficiencies caused by inclement weather.

Transnet National Ports Authority (TNPA) said the consignment formed part of an order of 52 units that would contribute to easing congestion and shipping delays at the ports.

View latest feature – Clearing & Forwarding – Click here!

A hydraulic tension mooring unit is a system that is placed on the quayside to ensure the safety of vessels, mitigating the severity of long-wave effects on vessels. The units assist by stabilising vessels during strong winds, adverse weather conditions and high swells, minimising down-time and improving safety of staff during port operations.

TNPA general manager for infrastructure, Thecla Mneney, said the delivery marked the first of a series of major port equipment deliveries at commercial seaports this year.

“We continue to make progress in fast-tracking the implementation of key investments in port infrastructure to improve operational efficiencies and provide quality service to the maritime industry,” he added.

The new mooring units increase TNPA’s capacity to prevent excessive surge motions of vessels alongside quays, bringing the total number of units to six at the Port of Cape Town and four at the Port of Ngqura.

Freight News Online

South Africa’s close ties with China, Russia, and Hamas are placing its relationship with the US in jeopardy.

This after US lawmakers Rep John James (Republican) and Rep Jared Moskowitz (Democrat) announced the introduction of the ‘US-South Africa Bilateral Relations Review Act’ in the US House of Representatives early last week.

The draft legislation reflects a growing realisation that while South Africa claims to be “non-aligned” on the global stage, its actions often do not reflect this.

Of particular concern to the lawmakers are the South African government’s close ties with China, Russia, and Hamas, “a US-designated Foreign Terrorist Organization and a proxy of the Iranian regime”. These relationships are considered a potential threat to the national security and foreign policy interests of the United States.

If the draft legislation passes, it will oblige the US administration to undertake a systematic review of South Africa’s activities to determine whether – as Congress suspects – they have undermined US interests. Should this be confirmed, it could result in a substantial reordering of the relationship between the US and South Africa.

Source: Freight News Online

PORTS

Summary of port operations

The following sections provide a more detailed picture of the operational performance of our commercial ports over the last seven days.

Weather and other delays

  • Dense fog and union engagements were the most prominent operational constraints in Cape Town.
  • The Morning Celesta was delayed in Durban for approximately 12 hours due to occupied and unavailable marine resources.
  • NCT went windbound for the most significant part of Wednesday, while GCT also struggled with adverse weather.
  • Unfavourable weather conditions proved to be an operational constraint in Richards Bay.

Cape Town

On Wednesday, CTCT recorded three vessels at berth and four at anchor as the terminal embarked on recovery operations after being extensively delayed by dense fog on the waterside. In the preceding 24 hours, stack occupancy for GP containers was recorded at 32%, reefers at a high of 73%, and empties at 28%. In this period, the terminal moved 1 314 containers across the quay while operating with eight STS cranes and 27 RTGs. Towards the end of the week, crane LC6 made a welcome return to service before LC5 was taken out of service for load testing operations. On the landside, despite facilitating union engagements across all three shifts, 947 trucks were serviced, while 21 export- and 14 import rail units were handled.

Durban

Pier 1 on Wednesday recorded two vessels at berth, operated by four gangs, and four vessels at anchor. Stack occupancy was 48% for GP containers and remained undisclosed for reefers. During the same period, the terminal recorded 1 158 gate moves on the landside, with an undisclosed number of cancelled slots and 102 wasted. The truck turnaround time was recorded at ~129 minutes, with an average staging time of ~103 minutes. At the beginning of this week, the terminal had 2 263 imports on hand, with 255 having road stops and 247 being unassigned. Several block extensions were granted this week due to equipment challenges causing high traffic volumes.

Pier 2 had four vessels at berth and six at anchorage on Thursday. In the preceding 24 hours, stack occupancy was 63% for GP containers and undisclosed for reefers. The terminal operated with ten gangs while moving 2 696 TEUs across the quay. During the same period, there were 2 403 gate moves on the landside with a truck turnaround time of ~139 minutes and a staging time of ~211 minutes. Additionally, 249 rail import containers were on hand, with 192 moved by rail. Towards the end of the week, the terminal had about 54 straddles in operation. This brings the straddle carrier availability figure in the terminal to about 56%. That is currently approximately ↓29% below the number of machines that would be the minimum to satisfy industry demand.

TPT in Durban further communicated that due to new shift patterns in their respective terminals, slot review times have changed to 06:10, 09:30, 13:30, and 18:10, respectively. Additionally, the port struggled with its marine equipment this week, as only four tugs were operational for the most significant part of the week. The technical team acted swiftly to ensure that the fifth tug was recommissioned by the end of the week. The port helicopter also went out of commission; however, a backup helicopter was rapidly sourced and refuelled to aid waterside operations. Lastly, the floating crane is anticipated to make a welcome return next week.

Richards Bay

On Tuesday, Richards Bay recorded 13 vessels at anchor, translating to four vessels destined for DBT, four vessels destined for MPT, and five vessels destined for RBCT. A further 11 vessels were recorded on the berth, consisting of four at DBT, four at MPT, two at RBCT, and one at the liquid bulk terminal. Two tugs and one helicopter were in operation for marine resources, while the pilot boat remained out of service. During the same period, the coal terminal had two vessels at anchor and two at berth while handling 180 289 tons on the waterside. On the landside, 12 trains were serviced. The latest reports suggest that TNPA has appointed FFS Tank Terminal (Pty) Ltd as the preferred bidder to develop and operate a liquid bulk terminal specialising in bunker fuels at the port.

Eastern Cape ports

On Thursday, NCT recorded two vessels on the berth and three vessels at the outer anchorage. Marine resources of two tugs, two pilots, and one berthing gang were in operation in the 24 hours leading up to Friday. The port’s original pilot boat remains out of service; however, they are still sharing resources with GCT to service waterside activities. Stack occupancy was 44% for GP containers and 63% for reefer ground slots, as a total of 1 600 TEUs were processed on the waterside. Additionally, 485 trucks were serviced on the landside at a truck turnaround time of ~37 minutes. On Wednesday, the terminal went windbound for the most significant part of the day.

GCT on Thursday recorded one vessel at the outer anchorage with one vessel on the berth. Available waterside resources were two tugs, a pilot boat, two pilots, and one berthing gang in the preceding 24 hours. Stack occupancy was recorded at 36% for GP containers and 38% for reefers. On the waterside, 620 TEUs were handled across the quay. Additionally, 105 trucks were serviced on the landside at a truck turnaround time of ~18 minutes. Strong winds and dense fog challenged the terminal throughout the week.

Source: BUSA- SAAFF

Global container freight rates and carrier profits

Continuing from last week’s decrease, global container rates dropped again, as the “World Container Index” is down by ↓1,0% (or $38) to $3 786 per 40-ft container19. The following figure shows the movement of rates in the last 12 months:

The composite index remains up by ↑90% higher compared to the same week last year and ↑167% higher than the average 2019 pre-pandemic rates of $1 420. Drewry expects rates to remain stable next week due to the CNY holidays. Charter rates continue to rapidly catch up, as the Harper Petersen Index (Harpex) is currently trending at 1 097 points, up by ↑3,4% (w/w) and getting closer to 2023 levels (↓1%)20.

This week’s news was brought to you by:

FNB First Trade 360 – a digital logistics platform and Exporters Western Cape