There is no doubt that the Covid-19 has caused all kinds of havoc in the logistics industry.
We still face huge backlogs, not only in South Africa but around the world. Cargoes and containers continue to be stranded in congested ports, with America and the UK also affected by a shortage of truck drivers due to increased trade and the impact of Brexit.
Maria du PrÃ©ez
Not only have we felt the effects of the border closures to the US, UK and Europe, but the airline industry has also moved away from dedicated cargo ships, choosing instead to reconfigure fleets to transport passengers and cargo. This presented challenges in terms of capacity availability in South Africa.
The macro trend is even more evident on the ocean freight side. It would be fair to say that the shipping companies have made the most of the current circumstances by increasing tariffs up to 400% in some cases. Unfortunately, the airline industry is now starting to follow suit, rapidly increasing freight rates.
The truth is, it won’t be easy for South African businesses and consumers.
At Bidvest International Logistics (BIL), we are committed to providing our clients with as much information as possible on these global trends to help them plan, although the coronavirus remains highly unpredictable and even the best-laid plans will require adjustments. .
Although we have recently seen incremental improvements, the supply chain situation is still far from what it is supposed to be.
At the local level, negotiating Transnet’s low productivity figures and decades-long maintenance issues remains problematic, although new challenges have also arisen. For one thing, Durban experiences strong winds that you would normally only associate with Coega and Cape Town. On the other hand, Transnet recently introduced a new truck reservation system which still does not work efficiently.
Rail also remains a huge problem in South Africa. Not being able to transport your cargo by rail means there is a backlog of trucks in ports and more trucks on our roads. Another obstacle is vandalism, particularly on the rail networks from Durban to Johannesburg and from Pretoria to Cape Town.
Over the past year, our industry has also faced a horrific situation at the borders of South Africa where trucks have been stranded for miles. Fortunately, the chaos on the Beitbridge border has finally been resolved, but now problems have developed on the border between South Africa and Mozambique.
On the positive side, this is attracting high-level attention from government, industry bodies, and other players. These same actors are now focused on resolving the problems of the Maputo Corridor.
What’s important to note is that demand for goods remains high despite the impact of the pandemic. She never stopped. Our customers have reported that even unusual products sell out as soon as they arrive.
This is one of the reasons South Africa simply cannot afford the truck drivers blocking the highways. Not only do protests against foreign drivers on our roads pave the way for retaliatory protests in their own countries, but the cost associated with delays is ultimately passed on to consumers.
Particularly in light of the African Continental Free Trade Area, it is not just about exchanging goods; you also trade in services, and transport is an integral part of trade in services.
While we understand that we need to preserve jobs in South Africa, we need to look at the big picture.
It may seem strange to suggest that good has come out of Covid-19, it cannot be denied that we have learned so much about the importance of data in our industry.
Since the outbreak, the South African Freight Forwarders Association (SAAFF) has started to accumulate much more data, leading the private and public sectors to share more information than before.
This has enabled SAAFF to compile and publish reports on various aspects, such as freight movements, what is happening in the global market and in the oceans, capacity availability, volume of inbound or outbound containers. , air cargo volumes and exports, and domestic air cargo.
If you have data, you can work effectively with government departments and organizations. For example, focusing on manual processes in the supply chain, establishing the time it takes between interventions and when it is released, and communicating this with the respective entities, has improved the delays in obtaining versions.
Data has become absolutely crucial.
This is why it is so important to embrace technology and learn to live and work with it. In the future, we will need technological skills, because we have to compete with global standards.
The world is once again seeing Africa as a potential growth market, so we need to be on top of our game.