Regulator enforces higher port tariffs

SOUTH Africa’s port users were slapped with the first tariff increase in two years on Tuesday‚ when regulator-approved dues came into effect.

The Port Regulator of South Africa rejected Transnet National Ports Authority’s (TNPA) tariff increase application of 14.39% for 2014-15 financial year last week.

The latter had asked the regulator to increase tariffs by 8.5%.

Further‚ TNPA had applied for the release of R454-million of provisions from the excessive tariff increase margin credit (ETIMC). Together‚ they make up the 14.39% request.

The regulator’s acting chief executive‚ Marissa Damons‚ said Transnet’s application to release ETIMC provisions had been rejected.

The reasons for the decision would be made known later this week.

But port tariffs will still rise. The regulator approved an increase in cargo dues of 5.9%. Dry bulk cargo dues for coal‚ iron ore and manganese‚ and tariffs on marine services were increased 8.15%.

This follows its rejection of Transnet’s tariff application in the previous financial year. Instead‚ it dropped port tariffs‚ in line with government’s commitment to providing rebates to exporters of manufactured goods‚ including car manufacturers.

Container export tariffs were cut 43.2%‚ container imports 14.3% and vehicle export tariffs 21.1%.

A study by the regulator found tariffs for the port of Durban to be 874% above the global average for containers‚ but if the government’s R1billion port tariff rebate is taken into consideration‚ that drops to 721%.

Steel manufacturer ArcelorMittal South Africa argued on Tuesday that the increase was in line with inflation.

“While this has been factored into the company’s annual planning process‚ it nevertheless adds to an already high South Africa operating cost base‚” said the company’s general manager of corporate affairs‚ Themba Nkosi.

TNPA has said it needed a tariff hike to fund its R2.4billion capital expenditure plans for 2014-15.

The lower increase could affect its investment into ports such as Coega‚ Durban‚ and Saldanha Bay. — BDLive