More bad news for Transnet as ports suffer major backlogs

South Africa’s logistics crisis is becoming as debilitating as the Energy Crisis as Transnet struggles with operational inefficiencies.

Turnaround Talk recently pointed out that shipping giants are fed up to the point that they are now penalising Transnet for unnecessary delays. But is this all that there is to the saga?

Transnet’s aged equipment creates backlog with 70k goods containers stuck

The original article can be found here.

South Africa’s rail, port and pipeline company Transnet has taken responsibility for not maintaining its equipment at some ports – compromising their lifespan.

This has contributed to the massive backlog at ports – with thousands of containers stuck ahead of the festive season where demand for goods spikes.

While Transnet has attributed the delays to broken equipment at its terminals, it has also cited bad weather as a contributing factor.

The Durban port has 70,000 stuck goods containers and there is a 21-day waiting period before offloading can take place.

The hamstrung state-owned enterprise said it’s working to clear the backlog, adding that it could take months to conclude.

Transnet’s acting CEO Michelle Phillips said they’re engaging Government to address the issue.

“We’ve been engaging with the National Treasury for some time now. You cannot have normal business processes apply in a situation where, strictly speaking, you are at war. Rome is burning and you need to get out of that situation as a matter of urgency.”

The government has played a significant role in assisting Transnet’s looming crisis, she added.

“The National Treasury has withdrawn a number of instruction notes that constrained us in the past when it comes to the procurement process.”

Phillips said this would help to speed up the process of acquiring the necessary equipment at the ports to successfully clear the backlog.

Transnet crisis sees almost 100 ships stranded

The original article can be found here.

A maritime gridlock at South African ports has kept nearly 100 vessels waiting to dock as Transnet, the state-owned logistics firm, struggles with breakdowns and bad weather.

Outdated equipment has contributed to the slow turnaround at Durban’s container terminal, which handles more than 40% of South Africa’s port traffic, Transnet Chairman Andile Sangqu told reporters in an online briefing on Monday.

The latest bottlenecks add to financial problems and poor performance throughout its other operations.  

Nearly 70 containers, cargo and bulk carriers were in or around Durban on Wednesday, according to ship tracking data compiled by Bloomberg.

The backlog, in part, prompted A.P. Moller-Maersk to dump Cape Town as a stop on one of its Asia routes.

There were 96 vessels waiting at anchorage outside South Africa’s commercial ports earlier this week, the South African Association of Freight Forwarders said in an emailed statement on Tuesday.

That results in direct costs of R98 million ($5.2 million) a day when congestion surcharges are added.

“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,” the group said.