SA container exports expected to increase by 5% to 10% this year

11th April 2014

By: Irma Venter

Creamer Media Senior Deputy Editor

  

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Container exports from South Africa are expected to record 5% to 10% growth in 2014, following the more than 10% growth seen in 2013, says Maersk Line South Africa trade executive Matthew Conroy.

Imported containerised cargo grew 5% in 2013 in South Africa. However, strong growth in the first quarter of the year petered out to flat growth in weak second, third and fourth quarters as rand strength decimated import volumes, with low consumer confidence also taking its toll, says Conroy.

Maersk Line is the shipping business of the Danish Maersk conglomerate, and the world’s largest container shipping company, with Southern African shipping company Safmarine a member of the group.

Between 30% and 35% of container exports from South Africa in 2013 were chrome and manganese, with 20% to 25% refrigerated cargo, such as fruit. The remainder comprised cargo such as paper, food, beverages and automotive products.
Refrigerated export container cargo grew 8% in 2013 on the back of a good farming season in South Africa and a relatively poor European crop.

South Africa’s largest containerised cargo trading partner is Asia, says Conroy.

Exports to Asia grew by 3%, to 50% of the total, in 2013. Europe came in at around 30%, and the Middle East and India at 10%.

Trade into Africa made up less than 5% of total container flow, and was heavily skewed towards exports from South Africa, notes Maersk Line South Africa MD Jonathan Horn.

The biggest African markets to and from which Maersk and Safmarine moved goods were Kenya, Angola and Nigeria.

Conroy says the outlook for the South African container market in 2014 is “more of the same”.

Global commodity demand and the exchange rate will continue to have a signiciant impact on container flows.

In the absence of any rand strengthening, imported containerised cargo will most likely be flat in 2014 on last year’s numbers.

However, while container exports in general may continue to grow, refrigerated cargo is expected to be “well down” on 2013, notes Conroy.

Havoc

This will be due to smaller crop outputs of several fruit varieties, with unseasonal weather such as hail and late frost causing havoc in this sector.

Table grape output alone will be down 25% to 30%, notes Horn.

Commodity exports are expected to grow by between 5% and 10% in 2014, as the US and European economies continue their recovery.

Any movement in the rand against the major currencies will only kick through to containerised cargo three to six months down the line, notes Horn.

Imports will gain, should the rand strengthen, for example.

In January 2013, the local currency was at R8 to the US dollar, but now fetched closer to R11.

“If the rand strengthens after the elections planned for May, then we could see imports grow by as much as 10% in the late second half as retailers take advantage of the cheaper import costs,” says Horn.

He rates Coega as South Africa’s most efficient port, followed by Durban.

“We have seen improved productivity at South African ports over the last few years.”

Edited by Martin Zhuwakinyu
Creamer Media Senior Deputy Editor

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