South African ports are facing a host of challenges, from bad weather to poor equipment, resulting in a queue of waiting ships at a major gateway.
While there have been some recent improvements in Cape Town and Port Elizabeth, Durban's Container Terminal remains severely congested.
According to data from Kuehne+Nagel's seaexplorer, there are currently 12 vessels waiting outside Durban with an average waiting time of 12 days.
As a gateway to northern South African provinces and neighbouring countries, Durban remains a critical pain point.
It's Pier 2 terminal is the largest container terminal in South Africa, with a capacity to handle 3400 containers a day. Last week, it moved around 2889 containers, translating to 84% productivity, reports the South African Association of Freight Forwarders (SAAFF).
Measures taken to limit the delay to South African cargo
Pressure from port users and the cost to the economy has brought heavy focus on improving productivity.
State-owned port operator Transnet has implemented a recovery plan which will bring some relief in the coming weeks to Cape Town and Port Elizabeth. For Durban's Pier 2, the recovery is expected to take 8-12 weeks.
While significant improvement is not expected in the short term, carriers and forwarders alike are working to mitigate the impact on customers.
In an advisory, Kuehne+Nagel states: 'Kuehne+Nagel is actively engaging in mitigation efforts to minimize customer impact, focusing on continuous improvement and vigilant monitoring to navigate these challenges effectively."
While carriers are changing port rotations on short notice, some have announced contingency plans to maintain a reliable service offering.
Maersk and CMA CGM have announced they would alternate port calls between Port Elizabeth and Port Louis, Mauritius, on their India Middle East - Africa services until the end of January 2024.
In addition, CMA CGM has adjusted its West Africa and South Africa Services to serve Cape Town via transhipment in Port Louis, Mauritius.
On a positive note, Transnet Freight Rail has found a solution to its cable theft problem, which has heavily impacted the movement of containers to hinterland areas.
As reported by Engineering News, it has replaced about 55% of the copper cables across its national railway network with an aluminium conductor steel reinforced (ACSR) cable called Tiger Wire. While ACSR is not as conductive as copper, it is less attractive to criminals and will keep the rail network operable.
The economic impact of port congestion
Earlier this week, SAAFF issued a media statement outlining the staggering economic cost of these disruptions.
"The additional direct logistics cost – simply put, the cost of the current situation - amounts to at least R48.5 million of pure, sunken cost just sitting outside at anchorage per day."
In addition, indirect costs, including the opportunity cost of goods waiting on vessels and the extended time to get these goods to market, add another R26 million per day and could be as much as R165 million, notes SAAFF.
"We must improve operational efficiency and increase throughput, or else the trade, transport, and logistics industries will continue to curtail desperately needed economic growth for South Africa,” emphasised SAAFF.
Transnet cautions that the complex challenges require significant investment and time to overcome. Procurement lead times for new equipment, so desperately needed, is estimated at 12-18 months.
