Port chaos: Transnet says Cape Town turnaround beat targets – but cold comfort for fruit exporters

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Transnet National Ports Authority (TNPA) says it is working hard to remedy a backlog at the Port of Cape Town that helped prompt a disastrous start to SA’s deciduous fruit season.

With SA’s fruit famers concerned about missing out on billions of rands, the port operator said operations have started to show recent signs of recovery. But congestion surcharges levied by global operators remain, while not all metrics are back at target levels.

Speaking at the Western Cape Legislature last week, TNPA port manager Oscar Borchards said more containers are being moved and loaded, while waiting times for vessels have improved since the “challenging” December period.

Recent statisitcs

Borchards said recent statistics show that vessel movement had reached a high of 8 000 standard containers per week against a target of 5 000. This means 16 000 containers had been moved in the last two weeks alone.

Between 15 and 21 January, vessel turnaround time had reached a high of 12 days against a target of four days, while truck turnaround time reached 75 minutes against a target of 40 minutes. However, as of February, vessel turnaround time has decreased to two days, while truck turnaround time decreased to 51 minutes.

Waiting time for vessels to berth at the harbour also decreased from 7.3 days to six days. This, however, remains well above the target of one day. 

Said Borchards: “It is not where we want to be, but it has improved. We also managed to reduce anchoring time for the vessels.”

Meanwhile, the Western Cape government has warned that the port has begun to lose its competitiveness, while there are concerns about the economic fallout from the continued dysfunction, including in SA’s labour-intensive agricultural industry.

The fruit season, which runs between November and May, started behind schedule due to decreased productivity, congestion, equipment breakdowns, adverse weather conditions and a lack of maintenance for infrastructure at the port.

According to TNPA, fruit volumes exported had decreased by 14% compared to the previous season, with producers warning that delays could once again cost the industry R2 billion in lost exports.

Provincial hit

Amid congestion and delays, fruit producers and exporters have also chosen to transport their cargo to the Eastern Cape ports of Nqqura and Port Elizabeth, as well as the Durban port to ensure that their product arrives on time.

Cargo was also exported from Namibia through Walvis Bay.

Normally, more than 50% of SA’s agricultural exports move via the Port of Cape Town.

Cape Town port manager, Rajesh Dana, said more than 5 000 containers had been sent to Ngqura, Port Elizabeth and the Durban ports. This has also proven costly for exporters who spend R38 000 per container to move their cargo to Eastern Cape ports.

The Western Cape Government has warned that port operations need to improve during peak trading season, as declining productivity could lead to the loss of thousands of jobs.

Member of the province’s Department of Economic Development and Tourism, Glen Steyn said in 2011, the port was one of best-performing container terminals in the world.

However, decreasing productivity and a sharp decline in ship working hour targets – less than half the target set by Transnet – remain a concern. 

Speaking at the legislature, Steyn said: “Unfortunately, there was a decline which became serious. Using working hours, there is a sharp drop in 2023 to half the working hours target set by Transnet. However, in the past weeks, we started to see the signs of recovery.”

According to Steyn, the port has also become incredibly important to the provincial economy, contributing nearly R20 billion in taxes to the government.

The port also helped sustain 225 000 jobs in 2021 during the Covid-19 pandemic and add R75 billion in the value of goods and services. However, if the port’s growth is not sustained, 19 000 jobs could be lost, according to the provincial government.

Steyn said there needs to be a clear Public Private Partnership (PPP) for technology and expertise to improve port operations.

Meanwhile, TNPA executive manager for the Western Region, including the Cape Town port, Vernal Jones, said while operations at the port have been “below international standards”, measures have been put in place to improve operations, including equipment availability.

He said while the port is battling equipment shortages and ageing equipment, orders were made for tugboats, work boats, haulers and helicopters that could direct vessels during adverse weather conditions. The equipment is expected to arrive between mid-2024 and 2025.

According to Jones, there are also long-term plans to increase the port’s capacity from one million containers to 1.4 million containers and improve traffic management. This, for example, could see congestion eased through the introduction of traffic circles.

Congestion surcharge

TNPA has also revealed that while there has been a slight improvement in decreasing delays, congestion surcharges have remained in place for major shipping lines at South African ports, including the Cape Town Port.

Last year, Mediterranean Shipping Company (MSC), Maersk, and French shipping company Compagnie Maritime d’Affrètement Compagnie Générale Maritime (CMA CGM) all announced they would be implementing surcharges, forcing cargo owners to pay an estimated $210 (R3 850) per shipping container.

Speaking to News24 at the Business-to-Business TNPA briefing on 23 February, Jones said there have been engagements with shipping lines to improve port performance and remove the current surcharges.

“The decisions of the shipping lines are not known to us in full detail because the decisions are made at head offices overseas, although it is done under the pretence of efficiencies and inefficiencies done at the port.”

Jones added they were engaging with shipping lines on the issue, and there had been a request to issue a container terminal performance plan in order to improve operations and oversight.