Lacking the means to deliver

Apr 25, 2004
Author: Terry Hutson

This article first appeared in The Mercury newspaper dated 2 April 2004, as part of a series looking at factors influencing the ports of Durban and Richards Bay

Diesel-electric locomotives such as these being loaded on board a ship bound for East Africa, were termed surplus to requirements by Spoornet and have been shipped to African countries despite a shortage back home. Picture Terry Hutson

A SMALL item in the news last year indicated that a leading bank and Spoornet were holding talks with the government of Ghana concerning the takeover of Ghana’s national railway.

In years gone by such news would have evoked excitement and a sense of pride. With Spoornet having already become involved in the operation of railways throughout more than a dozen other African countries, the pride would have been well placed.

The problem today, however, comes from having to remain enthusiastic while Spoornet is busy imploding and failing to meet the expectations and demands of its customers, particularly the importers and exporters who market and sell South Africa to the world.

Henry Posner III, chairman of a US company involved in privatised railway operations in Malawi, South America and Eastern Europe, last year drew attention to Spoornet’s involvement in Africa, which he called a paradox of financing that involved the privatisation of parastatals by a parastatal.

At a conference in London he drew attention to Spoornet’s involvement in African rail privatisations despite having embarked on a massive scrapping program, one that effectively reduced Spoornet’s capacity to handle traffic within South Africa.

“What is most important is that while South Africa is aggressively pursuing privatisations outside of South Africa, it has been successful in resisting it within its own country,” he added.

This background highlights a Spoornet policy that at times evokes visions of a scorched earth retreat - of a railway closing branch lines, scrapping tens of thousand of rail wagons, thousands of passenger coaches, and hundreds of locomotives, while at the same time discouraging and refusing specified cargo on major trunk lines because it claims not to have the infrastructure. Yet one of the ironies of Spoornet’s African safari is that it is making use of the same locomotives and coaches deemed surplus to domestic requirements.

Unfortunately this policy has had a direct effect on the ports, and Durban in particular. It has become of great concern to many importers and exporters who are finding their access to the port of choice limited by an intransigent railway administration that dictates rather than discusses, which has resulted in the cancellation of export contracts to the detriment of the country’s economy.

The method employed by Spoornet involves either increasing tariffs, on the basis that they have been historically undervalued, or by claiming that there isn’t sufficient rolling stock available.

These and other factors have relegated South Africa’s principal general freight artery, the Durban – Gauteng mainline, to playing a secondary role to the adjacent road in spite of the road system not having been designed for such volumes. In Durban itself, streets around the port have become congested with heavy vehicles accounting for about 80% of cargo moving in and out of the port.

Many of the port terminals have been forced to turn to this road transport to remain in business – it’s no secret that the Bluff coaling terminal is on the point of switching from coal as an alternative to facing closure because of Spoornet’s pricing policy. Spoornet tells coal producers that their commodity should be handled in Richards Bay, despite the lack of suitable facilities at the other port.

If this results in coal exported from Durban being replaced with another commodity - and the first test shipment has already left our shores - then the bad news is that an estimated two million tons a year will start entering the city by road instead of rail during this year.

WHAT should concern everyone is that this will require more than 50 000 ultra heavy road trucks to deliver the new commodity along Edwin Swales Drive and Bayhead Road each year – that’s an average of more than 140 each day.

There are other examples. For many years bulk salt was shipped from Walvis Bay direct to Durban. Spoornet’s pricing policy now dictates that this commodity will be handled at Richards Bay, from where it is delivered to Gauteng by road. This may not sound serious, except it means reduced port (and other) revenue for Durban plus an additional port call and costs for the shipping company, as the vessel has to return to Durban to load sugar for the return journey.

But it’s not all doom and gloom. A joint railfreight alliance between Sappi and Spoornet has successfully pointed the way forward for co-operative action between customers and the railway, with the port of Durban standing to be one of the main winners.

The dedicated ore lines to Saldanha and Richards Bay remain world class, although they remain challenged by capacity and maintenance.

Elsewhere there are few successes.

Seafreight is currently enjoying boom times with an increasing demand for raw materials, which other exporting countries such as Australia and Brazil are capitalising on through increased production. South Africa is hamstrung, not because the ports are unable to absorb the extra volumes but largely because Spoornet lacks the means to deliver.

AN ESTIMATED shortfall on rail of 10 million tons of general cargo has been mentioned, which was before the boom times began.

A year ago President Mbeki promised a massive upgrade of Spoornet infrastructure in his State of the Nation address. It remains unfulfilled.

Meanwhile the ports are bleeding, as are our roads, as is the economy.

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