Transnet is playing its cards close to its chest in a matter involving steep increases on its iron-ore line that runs from the Northern Cape through Lohatla, Kimberley and Bloemfontein to the Port of Ngqura in the Coega Industrial Development Zone (IDZ).According to Supply Chain Architects (SCA), an independent logistics provider serving small-parcel manganese exporters, the container freight rate increases will amount to a surge of more than 90% in costs.“It would make it unfeasible to operate,” SCA COO Sivi Reddy told FTW.He claimed that it would also force some of its clients, small-scale miners and related concerns, out of business and that it could result in a disastrous setback for the Maremane community, the area’s ancestral landowners from whom many ventures operating in the Kalahari basin lease their land.Reddy furthermore asked serious questions about Transnet’s mandate as a state-owned company (SOC) and sole provider of freight rail options for private entities.He said the sharp spike in passed-down expense that the increases would neccessitate would drastically drive up the cost for South African concerns operating in their own country, and would make a mockery of Transnet’s objective of providing cost-efficient alternatives for road transport.The claim that Transnet was working hard toward moving freight from road to rail, Reddy argued, was completely unrealistic when the SOC was on the verge of making a segment of rail freight unaffordable.Transnet, though, despite being emailed a set of questions about facts and figures days before FTW went to print with an initial story (see January 31 issue), finally indicated that it wouldn’t be drawn on what the increases might possibly amount to.All that Molatwane Likhethe, general manager for corporate and public affairs at the freight and rail parastatal was prepared to say was that “Transnet will be holding the original tariff (before any increases) until the end of March 2020”.“No increases will be applied during this time.”In the meantime, SCA says it’s on tenterhooks about what Transnet will ultimately decide.“We can only hope that they take the right approach in the end.”Should they proceed with the proposed increases, SCA said they reserved the right to litigate.It was exactly such a threat that purportedly resulted in the parastatal backtracking from the increases it announced toward the end of last year.As for Reddy’s claims that Transnet is supposed to assist local industry in creating local jobs by keeping costs down, the SOC’s former acting group executive, Mohammed Mahomedy, echoed his sentiments.Commenting on recent news that Transnet had broken a reefer record in the Port of Cape Town by loading 1 665 cold-chain boxes of fruit on a single vessel, Maersk’s Santa Clara, Mahomedy said: “This is in line with our growth strategy and our mandate to lower the costs of doing business in South A f r ica .”Reddy believes that, when push comes to shove, even if it means getting an interdict against the increases, Transnet should be held to the economic stimulus objectives Mahomedy mentioned.
INSERT: Transnet is not serious about moving freight onto rail.– Sivi Reddy
