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Africa|Business|Financial|Freight|Logistics|Mining|Pipelines|rail|Road|Service|Services|Storage|transport
Africa|Business|Financial|Freight|Logistics|Mining|Pipelines|rail|Road|Service|Services|Storage|transport
africa|business|financial|freight|logistics|mining|pipelines|rail|road|service|services|storage|transport

Ctrack Logistics Barometer shows encouraging upward momentum

Mike Schüssler

Hein Jordt

29th August 2019

By: Irma Venter

Creamer Media Senior Deputy Editor

     

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Vehicle tracking and telematics provider, Ctrack, has joined forces with economists.co.za to create the Ctrack Logistics Barometer.

The Ctrack Logistics Barometer aims to be an accurate co-incident indicator of the state of the South African economy, particularly in terms of the goods economy, explains economists.co.za’s Mike Schüssler.

“It is a good way of seeing how the wind is blowing in the economy.”

It could also be viewed as a performance gauge of the South African logistics and supply chain industries.

Schüssler, a well-known economist, is responsible for compiling the barometer.

“The barometer allows the business community and media to better understand how the logistics industry in South Africa is performing,” says Ctrack South Africa MD Hein Jordt. “With this information, businesses involved in the sector are able to make better strategic decisions.”

Schüssler adds that the barometer is not a forward-looking instrument, able to predict’s South Africa’s economic performance, but rather a tool to look at the transport industry in “a more informed way”.

He notes that the barometer does, largely, reflect South Africa’s economic growth cycles.

The Barometer
The Ctrack barometer is made up of six main subsectors, namely rail, road, air, sea, pipelines and warehousing.

Measurements are all in either volume or real terms, so that real changes can be measured, explains Schüssler.

“We have adjusted it slightly to include informal and own transport.”

Schüssler says measuring the transport industry is a valuable exercise, as South Africa’s logistics cost the economy 11.2% of gross domestic product (GDP).

Transport and storage that is paid by other companies is 8% of South Africa’s GDP, he adds.

Transport is as big as mining and bigger than real estate, business services and retail trade, but smaller than financial services on a value-added basis.

About 50% of the South African economy is made up of goods, with logistics a service that relates to the transport, storage and distribution of these goods.

“[Logistics] give a fair idea of how things are on the ground in the real economy,” says Schüssler.

The Ctrack Logistics Barometer for the quarter to end July 2019, compared with the quarter to end July 2018, shows fairly reasonable growth at 2.7%, he notes.

“The barometer basically says that transport is up 2.7% on a year ago.”

It is likely that the logistics sector is, at present, growing slightly faster than GDP, driven mainly by land-transport factors.

Road transport volumes were up 4.6% for the quarter ending July compared with the same quarter last year.

Rail freight volumes, which were primarily comprised of bulk commodities, recorded 3.9% growth for the quarter ending July.

The country’s pipeline volumes grew 2.8% for the quarter, compared with the same period in 2018.

Sea freight saw a decline of –1.1% in volumes for the three months to end July 2019, compared with a year ago, while air freight slipped –0.6% over the same period.

Schüssler adds that competition in the road sector is keeping freight prices low.

The road freight industry has more than 4 000 firms registered at the bargaining council.

While rail prices have picked up 108% over the last decade, road freight prices are up only 28%.

 

Edited by Creamer Media Reporter

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