Port congestion pushes out transit times

Africa is the new growth market for mining. That’s the view of Hilton Tait, managing director of FT Global Logistics, who believes the opportunities lie beyond South Africa’s borders. “Unfortunately the South African mining industry is still recovering from industrial action and financial results illustrate that we are in for a few lean years,” he told FTW. A division within the First Tech Group of Companies, FT Global Logistics is heavily involved in the mining sector – from trade finance and procurement of raw materials to freight forwarding, customs clearance and delivery to site. “We are seeing a number of emerging mining groups involved in projects and starting to do largescale exploration,” he told FTW. But the continent does have its challenges. “The road infrastructure in northern Zambia and the DRC leaves a lot to be desired. There are still too many delays at borders and complicated paper trails. This leads to congestion at border posts and long transit times. The nature of the export markets has also caused problems,” Tait told FTW. “Flows aren’t balanced so you have periods where hauliers don’t have return loads and are therefore reluctant to load from South Africa to places like the Copperbelt. The return loads can be seasonal, based on agricultural products that are being exported through South Africa.” He said further north, problems existed in both Dar es Salaam and Mombasa. Port congestion remains an issue and some shipping lines have changed schedules to get better economies of scale by using hub ports to combine both South African and European or Far East loads in order to reduce the number of vessels calling at these ports. “While it makes economic sense to carriers it has pushed out transit times and made planning a lot more difficult,” said Tait. What is just as unfortunate, he said, is that South African mining groups seem to be lagging in developing into Africa – specially in the light of the aggressive developments from both Australian and Canadian operators. “We as a group are having to market ourselves to companies based outside of South Africa which makes our selling difficult but we are assisted by high costs of sourcing goods and logistical issues if the goods are imported from these areas. South Africa has an advantage with its technical know-how and reliability of supply.” According to Tait, South African mining companies need to be more aggressive in terms of exploration and mining development. “There are risks attached to these investments but generally speaking long-term returns are good. Other South African companies will also benefit from the spin-off expenditure and support systems, while the freight companies and transporters can benefit from supply services and possible two- way logistics solutions." CAPTION Hilton Tait … ‘Still too many delays at borders and complicated paper trails.’