Durban Port to be Privatized

1. LOGISTICS AND INFRASTRUCTURE

In July the Durban Container Terminal (DCT) Pier 2, a crucial element of South Africa’s logistical infrastructure, announced a partnership with Manila-headquartered International Container Terminal Services Inc. (ICTSI), a leading global container terminal operator. Over a 25-year term, ICTSI will partner with Transnet Port Terminals (TPT) to develop and upgrade Transnet’s biggest container terminal, handling 72% of the Port of Durban’s throughput and 46% of South Africa’s port traffic.

This is good news for the citrus industry as congestion and delays at the port of Durban have been one of the biggest constraints to citrus exports from South Africa to date. This partnership is expected to bring about positive impacts on labour, business, and the government and drive growth in volume throughput and improve port functionality. The upgraded logistics infrastructure, such as container terminals and efficient transport systems, is essential for the citrus industry to handle its projected growth and ensure smooth exports and the private sector involvement is expected to benefit the entire citrus supply chain.

It is calculated that there are currently 2 200 trucks on the road per week transporting citrus from the northern regions, with a further 1 200 in the Eastern Cape and 1 000 in the Western and Northern Cape. Without improved rail capacity, production growth will require up to 3000 trucks on the road per week transporting citrus from the northern regions. It is concerning that during the peak of the season in the past few weeks, criminals have hijacked and torched several trucks on our major routes.  The resulting increased insurance premiums, additional security measures, and replacement of vandalised equipment create costs that are passed on to consumers.

It is therefore particularly good news that the important rail line between Durban and Gauteng, commonly known as the Container Corridor line, is currently also in the process of embarking on Private Sector Participation. This is also very good news for the citrus industry, as improvements to this vital rail link are crucial for the logistical capacity to move the increased production volumes to Durban, the country’s biggest port.