Reduced budgets force a switch from air to sea

The downturn in the world economy has not stopped companies from doing business, but it has changed the way they do business, according to Blain Kondiah, MD of Turners Shipping. He was commenting on the state of the freight management and logistics industry following the recent Air Cargo Summit held at Durban’s King Shaka International Airport (KSIA). The purpose of the summit, Kondiah told FTW, was to discuss strategies and future plans for the Dube TradePort at KSIA, which, according to the developers and management, could well become the ‘New Gateway into Africa’. “One of the goals of the TradePort,” he added, “is to recapture some of the freight that is being routed through OR Tambo International Airport (Ortia) in Johannesburg. “The purpose-built buildings and modern freight handling infrastructure at the country’s newest airport have been designed to offer maximum efficiency – with the cargo terminal, customs, the SA Police Service and Port Health officials all on-site.” Turners Shipping was one of the first of the freight management companies to establish itself at the TradePort when it opened in October 2010. “For the first year of operation at the airport,” said Kondiah, “we enjoyed increased volumes in airfreight. But there was a general drop in airfreight volumes over the last quarter of last year. This is linked to the economic climate, and will change in time.” He noted that, as airfreight volumes drop, there has been a steady growth in ocean-based imports and exports. “Reduced budgets have forced companies to become proactive – and the result is better planning of freight shipments,” he added. “Customers are able to take advantage of the substantial savings that ocean transport has to offer when compared to airfreight. Naturally the lead times are very different but people are adapting.” However, Kondiah emphasised that some sectors of the economy had not been as badly affected by the recession. “Mining operations in Africa continue, along with oil and gas extraction and exploration on the continent’s west and east coasts. And these rely heavily on the logistics industry for the supply of equipment and provisions.” An example of this interrelationship between these developing industries and logistics providers was Turners Shipping recently managing the delivery of around 50-tonnes of drilling equipment to Mozambique for Aprile Project – Italian-based specialists in the industrial shipment field. Said Kondiah: “The massive 15-metre-long crates were airfreighted into South Africa and transported by road to their final destination. This is definitely a sector of the economy that is experiencing growth despite the economic situation.”