A high-level stakeholder business breakfast hosted by ECSECC and the Maritime Business Chamber brought together key industry players to discuss unlocking growth in Nelson Mandela Bay through improved port efficiency. Held in Gqeberha on Thursday 12 June, under the theme "The Eastern Cape Province advancing the Maritime Agenda – Unlocking Growth through Port Efficiency in Nelson Mandela Bay,” the event featured a keynote address by Transnet Group CEO, Adv. Michelle Phillips who offered a candid and insightful look into the challenges and opportunities facing South Africa’s logistics backbone.
Her presentation highlighted several critical points that resonated deeply with attendees.
Adv. Phillips began by sharing positive news regarding Transnet’s recent performance. She announced that the state-owned enterprise has successfully arrested the decline of volumes, setting an ambitious target of transporting 180 million tons of iron ore, coal, and general freight in the current financial year. This marks a significant increase from 160 million tons in the last financial year and 151 million tons the year prior, signaling a renewed focus on operational recovery.
However, the path to efficiency is not without significant hurdles. Adv. Phillips laid bare the crippling impact of theft and vandalism on Transnet's operations. In the 2024/25 financial year alone, Transnet suffered a loss of approximately 7.5 million tons due to derailments, with an additional 5 million tons lost to theft and vandalism. Alarmingly, she noted that in most cases, derailments were a direct consequence of the pilfering and damage to Transnet infrastructure.
Further elaborating on factors contributing to downtime, Adv. Phillips painted a vivid picture of the daily struggles faced by train operators. She explained that manual authorisation for train drivers to proceed through certain sections can take between 15 to 30 minutes. This seemingly minor delay is a direct result of stolen signalling systems, forcing drivers to operate "blind" and increasing the risk of collisions. "This is what we go through on a daily basis," she stated.
The state of the network also necessitates temporary speed restrictions, where trains cannot operate at normal speeds due to the risk of derailment. To combat this, Transnet implements annual two-week "shuts" to undertake crucial repairs, acknowledging that a complete halt of operations is not feasible.
The pervasive issue of infrastructure damage was further underscored by the theft of Overhead Track Equipment (OHTE) cables and prevalent turnout defects. Adv. Phillips highlighted that 6 kilometres of total length cable had been stolen, a critical concern for both Transnet and potential private operators looking to utilise the rail network. The CEO emphasised Transnet's daily efforts to rectify these issues to ensure a more reliable network for all.
Amidst these challenges, Adv. Phillips offered a point of pride for the region: the Eastern Cape terminals, particularly for those in the container business, are the most productive across the country. This efficiency is attributed to strong CTOC (Container Terminal Operating Company) Compliance and robust service level agreements with customers.
A key highlight of the address was the discussion surrounding the future of manganese transport. Adv. Phillips confirmed that plans are underway to build a new facility to move 16 million tons of Manganese through the Port of Ngqura. Acknowledging that the existing facility is nearing the end of its operational life, she stated, "We are moving manganese through all sort of channels in the country but it needs to all come here. But this facility as you know needs to be decommissioned it is practically on its last legs so we will build a new facility in Coega."
Transnet has, however, paused its own development plans to allow for the completion of a Request for Information (RFI) issued by the Minister of Transport Ms Barbara Creecy. This RFI aims to gather industry input on the optimal solution for manganese logistics. "Once we get responses and get an understanding of what industry want regarding manganese we will then determine what the solution will be for the country," she explained. While the Eastern Cape is intended to be the primary hub for manganese, it cannot handle the entire national volume, thus Saldanha Bay will continue to play a role, but the new Coega facility will be a "major" one, Adv. Phillips told attendees.
In a significant shift, Transnet's initial intention to seek a partner solely for the water-side terminal in Port of Ngqura has evolved. The rail connection has now been incorporated into a single transaction. "Whoever the partner is who wants to come and do business with us will need to bid for the entire solution because it's no use to have a port terminal but you don’t have a connection," she explained. This integrated approach aims to create a "proper corridor" for manganese.
Addressing the pervasive industry interest in manganese, Adv. Phillips urged patience. "I want to say to everybody let’s allow the RFI to run its course because we want the industry to tell us what solution will work for them," she reiterated. Once the RFI responses are received, Transnet will assess if any changes to current plans are necessary before going to market to seek private sector investment. She hinted at a significant shift in ownership models, stating, "for the most part I think if it is not 50/50 it could very well be majority owned privately operated terminal."
As ECSECC and the Maritime Business Chamber continue to facilitate dialogue and partnership, stakeholders now turn their attention to the outcomes of the RFI process, which could reshape the logistics landscape of the Eastern Cape for decades to come.
View picture gallery of the event here
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