Grain imports set to tax SA harbour capacity
Drought may cause food shortages
FOOD shortages loom later this year as the country could have insufficient port capacity to handle massive agricultural imports required in the year ahead due to a devastating drought.
Grain South Africa (GSA), which represents 5 500 commercial grain farmers, is forecasting 5 million tons of maize imports during the marketing year from May 1 to April 30 next year as well as 2 million tons of wheat imports in the year ended September.
However, Transnet Port Terminals Agricultural Bulk operations had a total of just 4 million tons of annual capacity available across all its seven local ports, according to the Transnet website.
Head of GSA, Jannie de Villiers, said GSA was in touch with the ports and grain traders about the extent of capacity of available for maize imports. At times of maize shortages, South Africa mainly imports maize via Durban and Cape Town.
There were moves afoot to find out what capacity was available to import maize and contact had even been made with the port of Maputo in Mozambique, which has a grain terminal, De Villiers added.
Requirements
Another factor that would influence the logistics situation was that Zimbabwe would need to import maize, and those imports would most likely come through South African before heading to Zimbabwe, De Villiers said.
Mboniso Sigonyela, a Transnet spokesperson, said: “The company is already engaging with a number of customers to determine their specific requirements. Some of the initiatives include adapting and improving our handling methods, focusing on efficiencies as well as storage facilities. We are confident that we will meet demand on both rail and ports, should the need arise.”
Boikanyo Mokgatle, National Chamber of Milling executive director, said that he expected the local ports to face congestion as a result of the volume of maize, wheat and other agricultural imports required due to the drought.
“It is a very unusual circumstance that we are going to be experiencing – this drought is an exceptional event. We are going to see a surge in imports. We expect to bring in 1.8 million tons of wheat and up to 5 million tons of maize of imports if the drought conditions get worse,” he added. There had been concern expressed for a while that Transnet needed to improve its port capacity and extend the depth of its ports so that larger ships could be brought in, Mokgatle said.
De Villiers said that given the prevailing wheat and oil cake imports that are going through Durban he had heard the Durban port would only be able to facilitate import of 2 million tons of maize.
This meant that if there was a 5 million ton maize import requirement then 3 million tons of maize imports would have to come through South Africa’s other ports, he added. One idea would be to import maize through East London, Port Elizabeth and Cape Town and rail the maize through to the inland areas, but this would increase the cost of the maize.
“We should make a plan and there won’t be a food shortage, but there will be periods of time when food supply is limited. We are likely to run out of white maize because there isn’t much international supply of white maize. What will probably happen is that yellow maize will be used to make white maize,” De Villiers added. “The logistics are going to be tough. Can we import the quantities that we need?” he said.
Transnet has facilities for handling agricultural products at its Durban, East London and Cape Town ports.
“We have recently started utilising capacity at the Port of Richards Bay. In addition, we are able to convert some of our facilities, traditionally utilised for export, to accommodate an anticipated increase in import volumes. On the rail side, capacity is not a challenge,” Sigonyela said.
At Maydon Wharf in Durban the commodities handled are wheat, maize, soya bean, animal feed and wood chips, East London wheat and maize are the commodities handled while in Cape Town fresh produced is handled, according to the Transnet website. Away from Transnet, Bidvest-owned South African Bulk Terminals (SABT) also have agricultural handling facilities in Durban.
SABT owns two bulk terminals at the Port of Durban with a total storage capacity of 219 500 tons. Cargoes handled at SABT include rice, wheat, maize, malt, soya beans, sugar, sunflower seeds and oilcakes.
SABT managing director, Hampie Lourens, said SABT have about 190 000 tons of storage capacity available for grains, on the basis of turning this capacity twice per month, the terminal should be able to handle about 4.5 million tons of grain per annum.
“To achieve this throughput it is however imperative that imports are conducted evenly throughout the year and that all importers ensure that they move their cargo within 2 weeks. Having one or two months without imports will reduce this throughput drastically,” he added.
“One also needs to take cognisance that the same terminal capacity is also utilised for wheat, rice, sorghum, sunflower seeds and soya bean imports. These other commodities will in all likelihood require about 40 percent to 50 percent of our throughput capacity,” Lourens said.
Movement
“Logistics will have to be planned very carefully to move this volume of tonnages from the port to inland destinations. Both rail and road transport will have to be utilised… To facilitate continuous cargo movement and the maximum utilisation of both road vehicles and TFR’s rolling stock inland receivers will have to work on a 24/7 basis,” he added.
Lourens said SABT had been been approached by various traders regarding maize imports. “Cape Town, Port Elizabeth and East London based consumers will probably require about 1 million tons of maize,” he added.
“Transnet is comfortable that it can meet the projected demand by converting export facilities as a temporary solution. Our intention is not to invest huge amounts in this effort, but to focus on modernising and improving our handling methods. As a result, Transnet and private sector operators will have sufficient capacity to handle the additional volumes,” Sigonyela said.
‘We expect to bring in 1.8 million tons of wheat and up to 5 million tons of maize of imports.’