Automotive industry releases results of three port comparison

Walvis Bay port charges come out on top ALAN PEAT IN THE three port – Walvis Bay, Durban and Port Elizabeth - comparison conducted by the Automotive Industry Development Centre (AIDC) and the Walvis Bay Corridor Group (WBCG) FTW hoped to be able to give a simple 1st, 2nd, 3rd in cost efficiency. But, with the figures issued in the report no direct overall comparison is possible, and each of the five elements – lead-time, warehouse-to-port transit time, port-to-port transit time, total transit time and cost comparison - has to be judged on an individual comparative basis. For both the SA ports road transport comes out on top in lead-time, with cargo which is being railed having to be in City Deep terminal at least six days prior to the vessel departure date from Durban and Port Elizabeth - which increases the total transit time by a week. Rail is not an option to Walvis Bay. Stack closing For all three ports, the stack closing date lead-time is two days prior to the vessel’s estimated time of arrival (ETA). In warehouse-to-port transit time the SA ports are winners, being only one day‘s haul away by road from the Gauteng-based warehouses – while it’s a two day haul to WB. The port-to-port transit time was complicated by a transhipment via Rotterdam to Antwerp being necessary in the case of the trial shipment via WB, thanks to cargo volumes not being sufficient for shipping line MACS to be able to justify a direct call at the Belgian port. Transhipment from Rotterdam to Antwerp normally takes three days. However, in this particular instance eight days were added to the port-to-port transit time from WB. However, MACS offers a direct sailing on a bi-weekly basis to Europe from WB, and Antwerp is called direct when there is sufficient cargo. When vessels call direct, the transit time from WB to Antwerp would be five-to-six days shorter than via PE and ten-to-eleven days shorter than via Durban. “With an inland haulage transit time of two days from Gauteng to WB and the flexibility of the port in terms of receipt of cargo for export,” said the WBCG/AIDC report, “the trans-Kalahari corridor (TKC) is a viable option for time sensitive cargo.” Total transit Also, the total transit time for a container transported from Gauteng via WB to Rotterdam in Europe is 21 days, compared to a transit time of 24 days via the fastest option in SA, which is PE – and 30 days via Durban. Said the WBCG: “This minimum three day reduction in lead-time could be utilised to further optimise existing supply chains for time-sensitive goods.” The cost comparison was also a complicated issue. First was the fact that the volumes shipped by the SA automotive industry give the companies enough muscle to be able to get special negotiated rates for the SA routes. Equalised rates Also, the industry enjoys extremely good shipping rates, and, said the AIDC, equalised rates would have to be negotiated with shipping lines if this corridor is to attract automotive clients to WB. Since the various negotiated rates are highly confidential, market related rates as of July 2005 have been used for this exercise. Variable charges – such as insurance, fumigation, destination costs, additional documentation requirements, and clearing and forwarding – are not included since they are customer specific. Also, the custom bond rate stated in the cost comparison table is not applicable on cargo from Gauteng moving via SA ports but was included for WB for this trial shipment. However, said the AIDC report: “This amount is marginal, as bond charges would not apply to volume customers.” In the cost comparison, this charge and the higher road transport cost to WB – almost twice that to PE and three times that to Durban; and almost three times that by rail to either PE or Durban – were the limiting factors as far as the WB/TKC route were concerned. Where there were differences in the other charges, these were minimal – and, in fact, WB came out on top as far as the port charges were concerned, and was just in second spot on shipping line charges.