Logistics consultant Dave Watts on the absence of rail exacerbating container imbalances and why new landside rules are upsetting truckers

Smooth flow of citrus exports from Durban relieves an anxious industry

“At the Durban Container Terminal, reefer containers are doing very well this year and the citrus industry is going to hit some nice numbers in terms of volumes,” says Dave Watts, a logistics consultant to the citrus industry. “Generally this year has, so far, been better than we thought it would be in terms of the performance of the terminals.”

Durban port operations are certainly better than last year, he remarks; the week of civil unrest in KwaZulu-Natal in mid-July last year was immediately followed by a cyber attack on Transnet, paralysing exports.

Durban Container Terminal (photo © Lcswart | Dreamstime.com)

A slow start to harvesting spread volumes out a bit, creating some breathing space, but now the season is at its peak with between 1.8 and 2 million 15kg cartons of mostly navels and late mandarins loaded out from Durban every week. Some cold stores in the Durban area have been “very very full”, he adds.

The citrus export estimate has been adjusted downwards by two million cartons to 164.6 million 15kg cartons, which will nevertheless be a record. Last year South Africa exported 161.1 million 15kg cartons of citrus.

“There’s a real attention here in Durban on reefer traffic, DCT [the Durban Container Terminal] tends to look after reefers, there’s a lot of money in them. We’re reaching the citrus peak now, and generally at DCT plug points are sufficient. No containers have had to be turned away because of slot unavailability.”

Empty containers have also been more available than the industry expected at the beginning of the season, although freight rates are still a problem.

There is still some road hauling of boxes filled with Eastern Cape citrus to Durban, destined for the Far East, which comes at a massive extra cost, Dave notes, but necessitated by constrained shipping capacity and vessels not calling at all ports.

Overall, he observes, citrus exports are moving smoothly, no vessels are waiting at anchorage, and the weather has been kind (it is the windy season but Durban hasn’t seen much wind delay).

Virtually zero rail increases truck pickups by 20%
“Rail is virtually not available currently. Consequently, there’s been really very little citrus transported by rail,” he says. The April floods in Durban did a lot of damage to rail infrastructure connecting to the port of Durban, practically “wiping out” the signaling system.

“The industry has been trying to build rail up over the years. It was a nice option from Bela-Bela or Tzaneen [both in Limpopo Province] to bring reefers down on the main container corridor line but at present the only option is the north line via Richards Bay.”

Broadly speaking, the lack of rail has increased truck pickups from Durban by about a fifth since the floods, with a concomitant 20% rise in traffic on the roads of Durban, which already has some of the most congested roads in South Africa, going to and from the port.

Congestion on the streets of Durban as trucks make their way to the container terminal

Transnet indicates that rail infrastructure should be repaired by the first quarter of 2023, but copper cable theft on the railways is a never-ending battle on which the state-owned transport company is spending vast amounts of money on security.

Imbalance between outgoing 20ft and incoming 40ft containers
“In the broader sense, general container traffic is down,” he explains. “There is a classic imbalance (which also exists in the United States of America): the country imports manufactured goods in 40ft containers but exports bulk products like mineral ores and coal, with limited products containerized."

Import 40ft containers are now rather stripped in Durban and the contents road hauled as breakbulk, leading to a significant increase in trucks on the national highway.

“The impact of the imbalance between 20ft and 40ft containers has been there for a long time but it’s become worse now that shipping lines can’t get empty 40ft containers back economically by rail, as they would’ve done prior to the floods.”

Landside operations lag behind
“On the import side we have a real struggle on our hands. Terminals tend to look at imports as a problem and now they want to introduce even more stringent rules for what they call “free time”: a reduction in the time allowed to remove inbound containers, which used to be 3.25 days starting from vessel completion and will now commence from day of landing.”

Quite clearly, Dave observes, the focus at Transnet Port Terminals (TPT) is on discharging and loading of containers on the waterside, which isn’t always to the benefit of landside operations.

Durban Container Terminal (photo © Druid007 | Dreamstime.com)

He maintains that there is no question in the mind of truckers that there’s a capacity problem with, for instance, insufficient straddle carrier capacity to deal with imports on the landside.

He remarks that the trucking industry is “extremely upset” at the reduction in allotted time to remove import containers. “They think it’s totally unreasonable as it doesn’t take the time to arrange release processes into consideration.”

He emphasizes that this does not affect fruit exports. However, transporters tell him it’s becoming increasingly onerous and financially unviable for them to do harbour carrier work. Transporters exiting the industry, or rather taking on other work, could have an adverse effect on truck capacity for reefer and general cargo exports.

Parcel sizes increase as vessels become bigger
Over the years the number of container vessel calls to Durban has reduced while parcel sizes increase, in line with global trends as bigger ships are built.

He points out that in 2010, the Durban Container Terminal received 1,681 vessel calls carrying 2.5 million TEUs (1,504 TEUs per call, on average). Last year, there were only 654 calls to DCT, bringing 2.6 million TEUs which translates to a threefold increase in average parcel size on a vessel.

“You’re getting fewer calls, but they are more concentrated and closely followed by another vessel. This presents a completely different scenario, one that puts strain on terminal capacity and impacts on how terminals perform. It is a worldwide phenomenon - it’s nice to know we’re not the only ones facing these issues.”

An aerial view of the port of Durban (photo © Hongqi Zhang (aka Michael Zhang) | Dreamstime.com)

Plan for two new container terminals exceeds city’s capacities
Last year Transnet announced plans for a new container terminal at the Point Precinct, but Dave questions the assumptions of massive growth in volumes projected to move through Durban Container Terminal over the next ten to fifteen years (much of that slated to come from transhipments) on which the plans are based.

As a Durban resident who personally experiences the level of congestion caused by the thousands of trucks moving to and from the port precinct, the thought of a new container terminal fills him with no joy.

“A new container terminal at Point, handling 1.8 million, and a new container terminal at Maydon Wharf handling 1.4 million – how are you getting all of that stuff in and out? You can’t just push this much additional traffic into a city with four million inhabitants. A port should be built around what is available and what would be ideal for the residents of the city.”

He points out that the volumes handled at Durban has stayed fairly stable: in 2011, Durban handled 2.72 million TEUs, in 2021 Durban handled 2.696 million TEUs.

What he would much rather see, he says, is a plan that clearly shows how access into the terminals will be improved.

Ports being developed all along Africa’s coast pose future competition to South Africa’s ports, he notes.

 


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