May 09, 2008
© Reuse this
Makwetla: The looming global food shortage has caused the price of potash to more than double on the back of soaring world demand or fertilizer.
Creamer: We have been talking about this looming food shortage and now it is having an impact, because when you grow food, you need fertiliser and the fertiliser needs potash. We have seen the potash price soar 130 % to 150 % and this is not speculative buying like we have got with the oil price, this is real genuine fact-to-face buyer seller relationship.
So, it shows you how fundamental this food issue is and how important it is that we get some more capacity into the industry, get some more potash in. We see a scramble for potash in Africa. The Canadians have come in with MagIndustries and MagMineral to try and mine more potash in the Republic of Congo, not the DRC, and will be looking at Pointe Noire to try and get exports through there.
We also see our own Foskor, which is fertiliser related, and owned by the Industrial Development Corporation, have a revenue surge. All over the world this focus on food is now getting intense and is having an impact downstream on those ingredients that are needed to create food productivity.
Makwetla: South Africa’s shipping company Safmarine will add no less than 11 new ships to its fleet this year to meet soaring demand for sea transport.
Creamer: So, we see soaring demand for fertiliser, and also soaring demand for shipping services, which is impacting on our own Safmarine, which is now has the most ambitious programme in its history to add to the number of ships that it has got.
They will add another 11 new vessels to already 50 vessels in this year alone. I think they’ve added nine ships between 2004 and 2007 and now we have got this massive surge because of huge demand. Locally, the biggest demand bringer has been the automotive industry, because we are exporting vehicles that take up a lot space on ships.
But then, we really assemble those vehicles here, so, you have got to import the completely knocked down parts for assembly. You have got a two way import export there already and then because of the government’s motor industry development programme, you have got an export spinoff, because in order to earn credits they start producing automotive parts here and then exporting those separately.
But, of course, the big movers and shakers are the likes of China an India and we know se our Safmarine able to operate out of China sending goods to United States. Operating out of India and Pakisan into Europe. This massive shipping line expansion is symbolised in how quickly our own Safmarine is expanding.
Makwelta: Speaking of two way and movers and shakers, a multi-billion-rand race is hotting up between South Africa and Australia for the right to build a massive radio telescope to scan the night skies for the world. Tell us a bit more about that.
Creamer: Radio telescopes sounds very scientific and we are not normally fully au fait with what goes on with them, but we are looking to build the world’s biggest radio telescope in the Karoo, if we can win this tender. Now, there were several countries bidding for this and it is now down to Australia and South Africa.
It is a great multi-billion-rand project. In anyone’s book that is very good for the engineering sector and the economy. Besides promoting science, this SKA project on the cards for us has been championed by Dr Bernie Fanaroff. We see already that we will have a large telescope whether we win the SKA award or not, because we are building what is called the MeerKat already in the Karoo and take ‘meer’ in Afrikaans, which means many ‘more’ and ‘kat’ is the Karoo Array Telescope.
They decided that they need to have this as a core telescope in order to try and leverage more advantage in this race to win the SKA. That is being built at the moment and it has also got a lot of spin-off because some of the radio telescope dishes are already being locally manufactured and done quite innovatively.
So, we are getting quite a lot of technical back-up coming in from South Africa for this whole idea of radio telescopes which scan deep into space and teach the world a lot about our astronomical history. So, we could be the site for this if we win this bid, but it is going into a preparatory phase and is called the PrepSKA at the moment. We are preparing to win this. It will be announced in 2011.
Makwetla: Zooming in on heavy industry. Thanks very much. Martin Creamer is publishing editor of Engineering News and Mining Weekly, he’ll be back with us at the same time next week.
Edited by: Creamer Media Reporter© Reuse this Comment Guidelines (150 word limit)
Recent Research Reports
Steel 2015: A review of South Africa's steel sector (PDF Report)
Creamer Media’s Steel 2015 report provides an overview of the key developments in the global steel industry and particularly of South Africa’s steel sector over the past year, including details of production and consumption, as well as the country's primary carbon...
Projects in Progress 2015 - First Edition (PDF Report)
In fact, this edition of Creamer Media’s Projects in Progress 2015 supplement tracks developments taking place under the Renewable Energy Independent Power Producer Procurement Programme, which has had four bidding rounds. It appears to remain a shining light on the...
Electricity 2015: A review of South Africa's electricity sector (PDF Report)
Creamer Media’s Electricity 2015 report provides an overview of State-owned power utility Eskom and independent power producers, as well as electricity planning, transmission, distribution and the theft thereof, besides other issues.
Construction 2015: A review of South Africa’s construction sector (PDF Report)
Creamer Media’s Construction 2015 Report examines South Africa’s construction industry over the past 12 months. The report provides insight into the business environment; the key participants in the sector; local construction demand; geographic diversification;...
Liquid Fuels 2014 - A review of South Africa's Liquid Fuels sector (PDF Report)
Creamer Media’s Liquid Fuels 2014 Report examines these issues, focusing on the business environment, oil and gas exploration, the country’s feedstock supplies, the development of South Africa’s biofuels industry, fuel pricing, competition in the sector, the...
Water 2014: A review of South Africa's water sector (PDF Report)
Creamer Media’s Water 2014 report considers the aforementioned issues, not only in the South African context, but also in the African and global context, and examines the issues of water and sanitation, water quality and the demand for water, among others.
This Week's Magazine
Projected capital expenditure (capex) in the South African automotive assembly industry should reach a record R7.48-billion this year, says the National Association of Automobile Manufacturers of South Africa (Naamsa) in its 2014 fourth quarter business review. Capex...
After several years of navigating project-threatening red tape and currency fluctuations, the 4.4 MW Bronkhorstspruit biogas power plant, which will supply clean energy to a leading automotive manufacturer in Gauteng, is expected to enter production before June....
South African paper and pulp producer Sappi reported earlier this month that it would build a pilot plant for the production of low-cost Cellulose NanoFibrils, or CNF (nanocellulose) at the Brightlands Chemelot Campus in Sittard-Geleen in the Netherlands.
The long-term outlook for Nigeria is a country that has the potential to be very strong. So affirmed International Monetary Fund (IMF) Nigeria Mission Chief and Senior Resident Representative Dr Gene Leon on recently. "But we are starting from a point of huge...
Poor infrastructure planning and inadequate maintenance are becoming increasingly problematic for new developments and the associated infrastructure required to support such developments. In many urban and rural municipalities, the state of infrastructure has been...