Fuel surcharge keeps costings fair and equitable

THE ESCALATING fuel price is a major concern and cost to Zambia transport specialist Celtic Freight. It creates a lot of stress and strain for the company which has no choice but to pass the cost on to clients. To make the process as equitable as possible, Celtic has a base price per ton and every month they add a fuel surcharge directly related to the fuel increase. The benefit is that if the fuel price is reduced the surcharge is reduced exponentially, working on similar lines to seafreight where rates are calculated to accommodate any changes in currencies and the like. Yogesh Kuntawala, managing director of Celtic Zambia, believes this is the only way to handle the costs fairly as they “are not prepared to go for the kill and hide behind fuel increases to make a quick profit”. Celtic is growing along with the Zambian economy and will be moving to new premises by the end of 2008 as the company would like to get all its operations (including bigger offices, warehouses and open areas) under one roof. This is gigantic progress from the single 40 foot container which constituted their original home. Kuntawala says the major growth has happened over the past seven to eight years thanks to the new mines, sugar farming and other developments which have had a positive impact on all the surrounding industries and support services. The Zambian economy is still growing along with the identification of new mining sites and higher annual volumes of agricultural produce. For the company itself the biggest opportunity for growth is through an increase in its fleet size. They want to accomplish this without losing sight of the need to maintain quality service regardless of whether they have one or 100 trucks. Celtic considers itself to be part of the service industry and takes pride in delivering quality along with freight. In order to do this they are prepared to look at sustainable development over the long term instead of focusing on making a quick profit. The company’s fleet of 100 crossborder units specialises in the South Africa-Zambia route as they would rather be experts on one route and thereby offer quality service. Imports include machinery and equipment for the mines and other industries, consumable raw materials for manufacturing, commercial cargo for resale, irrigation and related material for the agricultural sector and project cargo. Celtic also has its own lowbed trucks for the import of abnormal equipment for the mines and other industries. Durban is the point of collection for foreign goods into Zambia. Goods manufactured in South Africa and imported into Zambia include furniture, irrigation equipment and the like. A huge part of the freight consists of paper imports of all kinds, from toilet paper to cardboard. Approximately 90% of Zambia’s paper requirements are imported from South Africa. On the export side freight includes agricultural products such as cotton which is exported in lint, seed or cake format, coffee, maize seeds and tobacco. When it comes to minerals, copper concentrate and copper cathodes rule the roads. Celtic also moves a lot of containerised personal effects out of Zambia.