News / South African citrus exporters facing problems as peak season looms

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By 13/05/2020

As South Africa's citrus fruit exporters prepare for their peak shipping season and shipping lines rush to reposition empty reefers, the country's main ports are pushing through programmes to increase capacity. Citrus exporters are faced with a series of challenges, including port congestion, a potential shortage of reefer equipment and the danger of not being in compliance with the country's trucking regulations. Cape Town Container Terminal (CTPT) was due to return to full operational capacity today - although port operator Transnet had to close the terminal for 12 hours on Saturday for cleaning "in light of the sudden increase in pandemic cases in the Western Cape".

The terminal had recorded its first case of infection the previous day. According to guidance from the Citrus Growers Association (CGA), the port was due to go from operating two of its berths to the full three today, while the Ngquara Container Terminal (NCT) is set to go from one of its three berths to two. At the beginning of April, when South Africa's lockdown began, both ports were reduced to operating one berth apiece and the number of containerships waiting at anchor begun to rise.

CGA said on Friday: "Thanks to TPT [Transnet Port Terminals] for heeding our call from the onset. If the status quo had remained as it was on 27 March, the situation would have been very dire."

That of course, would depend on growers obtaining enough empty reefers to load their exports - and it was this fear that recently led Maersk to launch a special sailing from Dubai at the end of April to deliver 1,800 empty reefers to South African growers. These are now entering their supply chains and local sources largely agree this should initially be enough to meet demand. "But some damage has already been done," Mike Walwyn, Western Cape regional chairman of the South African Association of Freight Forwarders, told The Loadstar.

"At the moment, we have two conventional refrigerated vessels a week calling at Durban and Cape Town to take up some of the slack, but they only carry the equivalent of around 200 containers each, whereas vessels usually load over 1,000." A further problem for exporters and their forwarders and hauliers is that every reefer flouts South African road legislation. Under article 224 (b) of its National Road Traffic Regulations, the maximum height of a box to be transported by truck is 4.3 metres, while a high-cube refer is some 0.3 metres above the limit.

This issue dates back to 2009, when the height restriction was suddenly enforced, and trucks carrying high-cube containers were impounded by traffic authorities, particularly in KwaZulu-Natal where the port of Durban is located. The ban was then lifted, and after extensive consultation between the Road Freight Association and Department of Transport, a moratorium was put in place under which road-transport vehicles were exempted from the 4.3-metre height restriction for seven years. The moratorium expired on 1 January.

Christo Erasmus, head of legal for Bidvest International Logistics (BIL), said: "My concern is that further delays in amending the legislation will have an impact on industries across South Africa. Every truck leaving a port or harbour with a high-cube container will immediately expose players to penalties and fines. Apart from reputational damage, this will expose logistics companies to financial losses."

Mr Walwayn called the issue "contentious", adding: "The Department of Trade has not gazetted the moratorium, so it's only in place on the basis of a letter from the director-general, which technically opens the road for any cash-strapped local or provincial authority to start issuing fines. "However, no stops or prosecutions have occurred since the expiry of the moratorium," he added. South Africa is the second-largest exporter of citrus fruits in the world, after Spain, with some 85% of its volumes shipped in reefer containers. According to the Fresh Produce Exporters Association, 48% of the exports go through CPCT, as the majority of citrus products are grown in the Western Cape, 34% go through Durban and the remaining 18% through NCT.

And just under 50% of those volumes are destined for the EU and UK and are largely carried on two container services - the SAECS/SRX , jointly run by ONE, Maersk and Deutsche Afrika Linie, and the NWC-SAF operated by MSC, with Hapag-Lloyd as a slot charterer. The remainder is loaded on conventional reefer vessels.

However, more vessel capacity could be on the way, according to liner shipping database eeSea, which noted that the SAECS members were due to add a ninth vessel and increase the round-trip by a week.

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