Changing market conditions turn up the pressure

KEVIN MAYHEW SOUTH AFRICAN consolidators are coming under intense pressure to offer a regular and reliable service to Africa as goods are increasingly routed through southern African ports and the volume of exports from South Africa continues to be adversely affected by the stronger rand. Managing director of Germiston-based Discount Freight, Jakes Ambaram, says that a recent visit to clients in Malawi and Zambia had given him the impression that importers in these countries believe South African exporters have priced themselves out of these markets. “The reasons given were twofold - the strength of the rand against the dollar and a reluctance by South African exporters to reduce their prices to remain competitive. This has forced importers to source from other markets like Kenya, Tanzania, Dubai and the Far East which offer more competitive prices despite the long delivery distance compared with South Africa,” he said. In addition, most of the imports are being routed through the more competitive ports of Nacala and Beira in Mozambique and Dar-es-Salaam in Tanzania to avoid the more reliable but stringently red taped port of Durban, Ambaram added. “Only urgent consignments or those of a sensitive nature are routed through Durban for removal in-bond to these landlocked countries. Gone are the days when we used to dispatch daily consolidations. Now we have to contend with two consolidations per week and this trend is likely to continue unless the rand weakens to about R7.50/dollar and provided South African exporters can regain their foothold in these countries,” he concluded.