Breakbulk sector will score high from Transnet’s investment plans

South Africa’s breakbulk industry will derive the greatest benefit from Transnet’s Market Demand Strategy (MDS) because much of the investment will go to rail improvements. That’s according to Transnet CEO Brian Molefe who believes that the investment of more than R150 billion in Transnet Freight Rail will increase rail’s competitiveness in the bulk cargo and even the project cargo sector significantly. “Rail’s greatest advantage lies in its ability to move bulk cargo more cheaply than road over long distances,” he said in Cape Town recently. “The MDS, which will see us spending R300 billion overall in the organisation, is really aimed at moving road cargo to rail. Through this investment we will increase our capacity exponentially, which bodes well for the breakbulk industry.” The MDS will see the organisation increase its revenue from R46 billion to a whopping R128 billion over the next seven years, with profits set to increase to R68 billion. “This is our story and we are sticking to it,” he said. Through the MDS, Transnet Freight Rail will see an increase of 44% in its coal capacity, moving 98 million tons of coal by 2019 from the current 68 million tons. “This will make us a key thermal coal exporter in the world,” said Molefe. “Our targets to increase the iron ore moved from 53 million tons to 83 million tons will see us become the fourth-largest supplier of iron ore to China while we will also become a leading manganese exporter globally.” He said while the investment would especially benefit the general freight business – with containers coming though the country’s ports expected to increase from 4.3 million to 7.6 million – the breakbulk sector was an important area Transnet wanted to address. “Yes, we will see our containers on rail increase drastically, but it is in the movement of bulk cargo where the real advantage lies,” he said. “We want to see the 7.3 million tons of coal we move for Eskom increase to an expected 29.6 million tonnes, while we want to improve the manganese from 4.8 million tons at present to 11.7 million tons. We are also planning a new manganese terminal at the Port of Ngqura, while the railway line from De Aar to Ngqura will see some major refurbishment.” CAPTION Brian Molefe … ramping up capacity and operational performance.