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REGISTRATION NUMBER: 2014/042417/08 PRESIDENT: Sipho M Pityana VICE PRESIDENT: Martin Kingston CEO: Cas Coovadia NEDLAC CONVENOR: Kaizer Moyane DIRECTORS: Angela Russell, Bongi Kunene, Busisiwe Mavuso, Christopher Campbell, Deidre Penfold, John Dludlu, John Purchase, Roger Baxter, Stavros Nicolaou, Zoleka Lisa
NATIONAL OFFICE 61 Katherine Street, Sandton, 2196
P.O. Box 652807, Benmore, 2010 www.busa.org.za +27 11 784 8000
PARLIAMENTARY OFFICE
9 Church Square, 1st Floor Graaffs Trust Building, Cape Town, CBD
COVID-19: Cargo movement update Date: 6 November 2020
About this update
This update — the 14th of its kind — contains a combined overview of the flow of air, sea, and road freight
to and from South Africa in the last week. The report provides a consolidated view of the different modalities
published earlier by the Business for South Africa supply chain team.
Weekly snapshot Table 1 - Port volumes and air cargo flows compared to last week
Flows Current1 Previous2
Growth Import Export Total Import Export Total
Port Volumes (TEUs) 27 263 26 297 53 560 30 121 36 273 66 394 ↓19%
Air Cargo (tons) 4 321 3 202 7 524 4 464 3 282 7 746 ↓3%
Monthly snapshot Figure 1 - Monthly3 cargo flows compared to the same period in 2019
Key Notes
• An average of ~7,651 TEUs were handled a day over the course of the last week, ↓19% from last
week.
1 ‘Current’ means the last 7 days’ (a week’s) worth of available data. 2 ‘Previous’ means the preceding 8-14 days’ (a week’s) worth of available data. 3 ‘Monthly’ means the last full months’ worth of available data compared to the same month in 2019 (in this case Sept 2020 versus Sept 2020; except for air cargo, as well as containers, which compares the most recent month Oct/Nov 2020 versus Oct/Nov 2019).
79%
120%
139%
146%
52%
74%
33%
0% 50% 100% 150% 200%
Containers (TEUs)
Dry bulk (MT)
Liquid bulk (MT)
Breakbulk (MT)
Vehicles (Units)
International Air Cargo
Domestic Air Cargo
2
• International air cargo volumes have decreased by ↓3% since last week, currently at ~91%
compared to pre-lockdown levels, and ~74% compared this time last year. Domestic cargo is ↑2%
from last week.
• Regionally, cross-border road transport into Zimbabwe continues to be delayed, with average queue
time around 74 hours or (three days) and average border crossing times at around 23 hours.
• Global freight rates have increased by ↑0.5% for the week, with the WCI now at $2,627.94 per 40’.
Ports Update
This section provides an overview of the flow of containerised cargo to South Africa’s commercial ports.
Container flow overview
The following two tables indicate the container flows for the last 7 days, as well as the projected container
flows for the next 7 days.
Table 2 - Container Ports - 7-day flow forecasted for 31 October to 6 November 4
7-day flow forecast (31.10.2020 - 06.11.2020)
TERMINAL NO. OF CONTAINERS TO DISCHARGE (IMPORT)
NO. OF CONTAINERS TO LOAD (EXPORT)
DURBAN CONTAINER TERMINAL PIER 1: 3 945 5 211
DURBAN CONTAINER TERMINAL PIER 2: 13 707 9 643
CAPE TOWN CONTAINER TERMINAL: 3 796 5 451
NGQURA CONTAINER TERMINAL: 5 645 5 752
PORT ELIZABETH CONTAINER TERMINAL: 170 240
TOTAL: 27 263 26 297
Source: Transnet, 2020. Updated 06/11/2020
Table 3 - Container Ports - 7-day flow forecast for 7 November to 13 November5
7-day flow forecast (07.11.2020 - 13.11.2020)
TERMINAL NO. OF CONTAINERS TO DISCHARGE (IMPORT)
NO. OF CONTAINERS TO LOAD (EXPORT)
DURBAN CONTAINER TERMINAL PIER 1: 4 057 4 650
DURBAN CONTAINER TERMINAL PIER 2: 17 275 16 583
CAPE TOWN CONTAINER TERMINAL: 4 950 5 187
NGQURA CONTAINER TERMINAL: 6 333 5 977
PORT ELIZABETH CONTAINER TERMINAL: 0 0
TOTAL: 32 615 32 397
Source: Transnet, 2020. Updated 06/11/2020
An average of ~7,651 TEUs were handled per day over the course of the last week (31 Oct - 6 Nov, Table 2),
with an increased average of around ~9,287 TEUs (↑21%) expected to be handled over the course of the
next week (7 - 13, Nov Table 3).
Overall stack occupancy is approximately ~64% and ~25% in Durban and Cape Town, respectively. In terms
of the multi-purpose terminals, stack occupancy is around ~51% and ~42% (general cargo) and ~18% and
4 It remains important to note that a fair percentage (approximately 28%) of containers are neither to be imported nor exported, but rather consist of empties and transhipments. Due to container imbalances, this proportion is fluctuating more than usual. 5 As noted in footnote 1.
3
~10% (refrigerated cargo) in Durban and Cape Town, respectively. Stack occupancy in Ngqura and Port
Elizabeth is ~54% and ~10% (general cargo) and ~11% and ~1% (refrigerated cargo) respectively.
The following figure displays the rolling 7-day average flows of total cargo movement for our respective
commercial ports since the start of the nation-wide lockdown.
Figure 2 -7-day flow forecast for total cargo movement (TEUs: 30 March to 7 November; week-on-week)
Source: Calculated using data from the Transnet Port Terminal updates. Updated 06/11/2020
The figure above serves as a summary of the cargo flows since the start of lockdown. The longer-term
average trend remains upward; however, we are only expecting overall port volumes to reach ~92-94% of
2019 levels across the board.
The figures below show the weekly container flows for the last 7 days, as well as projections for the next 7
days.
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7-day flow period
DURBAN CONTAINER TERMINAL PIER 1 DURBAN CONTAINER TERMINAL PIER 2
CAPE TOWN CONTAINER TERMINAL NGQURA CONTAINER TERMINAL
PORT ELIZABETH CONTAINER TERMINAL Linear (DURBAN CONTAINER TERMINAL PIER 2)
4
Figure 3 - 7-day flow forecast for total cargo movement (31 October to 6 November; day-on-day)
Source: Calculated using data from Transnet Port Terminal, updated 06/11/2020.
Figure 4 - 7-day flow forecast for total cargo movement (7 November to 13 November; day-on-day)
Source: Calculated using data from Transnet Port Terminal, updated 06/11/2020.
Summary of port operations
An average of ~7,651 TEUs were handled per day over the course of the last week (31 Oct - 6 Nov, Table 2),
with an increased average of around ~9,287 TEUs (↑21%) expected to be handled over the course of the
next week (7 - 13, Nov Table 3). The overall monthly containerised cargo volumes are slightly down once
again, currently at ~79% compared to the same time last year. Nonetheless, when surveying the monthly
figures compared to the previous year, the previous two months’ average stood at ~350 000 TEUs. As such,
-2
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4
6
8
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31-Oct 01-Nov 02-Nov 03-Nov 04-Nov 05-Nov 06-Nov
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7 day flow - 31 October to 6 November
DURBAN CONTAINER TERMINAL PIER 1 DURBAN CONTAINER TERMINAL PIER 2
CAPE TOWN CONTAINER TERMINAL NGQURA CONTAINER TERMINAL
PORT ELIZABETH CONTAINER TERMINAL
-2
0
2
4
6
8
10
12
14
16
18
07-Nov 08-Nov 09-Nov 10-Nov 11-Nov 12-Nov 13-Nov
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7 day flow - 7 November to 13 November
DURBAN CONTAINER TERMINAL PIER 1 DURBAN CONTAINER TERMINAL PIER 2
CAPE TOWN CONTAINER TERMINAL NGQURA CONTAINER TERMINAL
PORT ELIZABETH CONTAINER TERMINAL
5
early projections are similar for November and December of this year, meaning that in an overall sense,
containerised cargo for 2020 is projected to be ~92-94% capacity levels compared to 2019.
Weather-wise, wind, rain and fog disruptions hampered port operations over the weekend. Wind disrupted
operations in Cape Town for 35 hours. In contrast, Kwa-Zulu Natal received some welcome heavy rain over
both Saturday and Sunday. The situation resulted in slow working at both piers and virtually no work at
Maydon Wharf since all vessels bar one working there were handing rain sensitive cargo. Despite some
delays, the situation abated to bring improved conditions around the coast which have enabled terminal
operations to commence catch-up from the weekend delays.
Over the course of the last week in Durban, port operations were near average, despite some ongoing truck
congestion in Maydon Wharf caused by TPT’s weighbridge failure. Some suggestions have been made to
alleviate this by the introduction of a booking system. However, the introduction of such a system at Maydon
Wharf would necessitate an off-site staging area as most trucks servicing the area are long-haul for whom
advance booking would be impossible.
Maydon Wharf TPT management, along with NPA security, have indicated that they are addressing the
matter where they can. However, the unfortunate fact is that Maydon Road remains a public municipal road,
which means that the smaller roads feeding into the quays are affected by whatever happens along Maydon
Road.
Concerning the recent service disruptions experienced by Transnet Freight Rail (TFR), problems in Gauteng
have unfortunately continued. The affected section outside Kaserne was temporarily operated with diesel
locomotives, which slows down overall train times. However, more importantly, a shortage of diesel
locomotives means further delays are projected. TFR is working on supplementing units from other areas
Furthermore, TFR continues facing issues in the Jupiter area as the major fault with ESKOM power having
broken down. Luckily, the power failure at Jupiter was fixed a day before plan. Unfortunately, as a continued
pain point to report on, there was another incident of cable theft in the area overnight.
Plans are now in place to resume the movement of over border cargo and ramp up movement on the
NATCOR line. Minister Mbalula addressed parliament on this matter stating that “the jig is up”. This
apparently means that some action is planned around security improvements, with Minister Mbalula adding
“The harsh reality is that security-related incidents in the rail environment are out of control and need urgent
attention”.
The rail delays and lack of movement had a knock-on effect as equipment as both wagons and locomotives
not arriving means a build-up of container traffic held in the Durban terminals. Some traders are cancelling
train loads and moving to the road, which in turn hurts landside performance and traffic on the N3.
Moreover, containers for Botswana continue to build up at DCT with Pier 2 holding approximately 1,170
TEUs which is unlikely to be materially improved before the “Jupiter” issue mentioned above is finalised.
In Cape Town, the adverse weather conditions over the weekend have eased to some extent. The improved
conditions have meant that near-normal handling rates were reported for the rest of the week. There were
forecasts of continued strong winds into the weekend, but luckily, the port has not reported any additional
operational challenges in terms of equipment and active gangs. Furthermore, the port is continuing with its
COVID-19 screening efforts, as well as reporting efficient truck turn-around times even with more than 1,000
daily calls.
6
Air Update
• International air cargo
The following table depicts the inbound and outbound air cargo flows to and from ORTIA in the last week.
For comparative purposes, the average air freight cargo (inbound and outbound) handled at ORTIA in the
two months before the lockdown period (January and February) was approximately 743 879 kg per day6. The
average air freight cargo (inbound and outbound) handled at ORTIA in October 2019 was about 946 660 kg
per day7.
The volumes given in the table are also in kilograms.
Table 4 - International inbound and outbound cargo from OR Tambo8
Flows 29-Oct 30-Oct 31-Oct 01-Nov 02-Nov 03-Nov 04-Nov
Volume inbound 474 146 352 112 422 137 529 827 498 025 187 898 395 197
Volume outbound 260 392 295 519 341 051 316 585 247 085 177 070 243 411
Total handled per day 734 538 647 631 763 188 846 412 745 110 364 968 638 608
Updated: 06/11/2020
The average volume of air cargo handled at ORTIA over the seven days starting 29 October amounted to 408
477 kg inbound and 268 730 kg outbound, resulting in an average of 677 208 kg per day, which is
approximately ~91% compared to the two months before the lockdown period and down by ↓3% since last
week. Interestingly, current levels correspond to circa ~74% when compared to the same period the previous
year. The current situation reflects the traditional seasonal imbalance in volumes.
The following figure paints a better picture for the monthly flow of international air cargo to and from ORTIA
for October. This average has also slowly increased over the course of the last couple of months.
Figure 5 - 7-day cargo flow for OR Tambo
6 Note, when including statistics from South Africa’s other two international airports, Cape Town International and King Shaka (Durban) International airports, the total figure rises to 916 175 kg per day. 7 As with the previous footnote, the total figure rises to 1 165 984 kg per day. 8 Note, some of the very latest statistics for both Menzies and Aero-link stats are still outstanding. Therefore, the overall statistics are expected to increase somewhat and will be amended in subsequent reports.
0
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300
400
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600
29-Oct 30-Oct 31-Oct 01-Nov 02-Nov 03-Nov 04-Nov
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Inbound and outbound air cargo, 29 October to 4 November
Volume inbound Volume outbound
7
Updated: 06/11/2020
The following figure shows the cargo movement per carrier since the start of the lockdown period.
Table 5 - Total international cargo movement to and from OR Tambo
Partner 29-Oct 30-Oct 31-Oct 01-Nov 02-Nov 03-Nov 04-Nov
Amsterdam 42 037 50 052 39 086 71 767 46 576 50 432 74 143
Doha 79 623 108 291 24 692 25 939 105 528 25 360 33 228
Dubai 24 758 100 244 168 230 119 319 65 444 74 796 92 564
Frankfurt - - 22 844 - 22 091 - 33 728
Istanbul - - 37 174 - 104 514 - 36 715
Johannesburg 53 568 33 003 65 525 24 778 6663 4,8 20 713 62 986
London 73 192 29 480 71 023 78 347 914 72 91 935 39 802
Luanda 8 - - - - 6 091 -
Luxembourg - - 78 946 - 68 552 - 79 916
Nairobi 150 372 127 484 33 842 161 385 109 350 34 365 116 117
Paris 43 128 43 330 81 026 47 980 41 291 39 317 40 777
Singapore 18 339 25 321 177 752 23 657 21 959 28 196
Unspecified 192 295 99 149 115 479 139 145 - - -
Windhoek - 58 - - - - 436
Zurich 57 218 56 540 - - - - -
Total handled: 677 320 591 091 763 188 846 412 745 110 364 968 638 608
Updated: 06/11/2020
The following figure gives a graphic representation of the table above, which shows the diversity of South
Africa’s trading partners in terms of cargo handled per carrier. Overall, international freight has decreased
by ↓3% compared to last week.
8
Figure 6 - International air cargo movement per country of origin
Updated: 06/11/2020
The following figure shows the cargo movement per carrier since the start of the lockdown period.
Figure 7 - Total cargo movement between OR Tambo per carrier
Updated: 06/11/2020
0
50
100
150
200
250
29-Oct 30-Oct 31-Oct 01-Nov 02-Nov 03-Nov 04-Nov
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Cargo movement per flight origin country
Amsterdam Doha Dubai Frankfurt Istanbul
Johannesburg London Luanda Luxembourg Nairobi
Paris Singapore Unsepcified Windhoek Zurich
02468
1012141618
Mill
ion
s
Cargo movement per Carrier, 30 March to 4 November
Sum of Outbound Sum of Inbound
9
The next figure illustrates the cargo moved per ground handling agent since the start of the lockdown period,
with Swissport, Worldwide Flight Services and Aero-Link handling most of the international freight to and
from ORTIA.
Figure 8 - Cargo movement during the lockdown, per handler
Updated: 06/11/2020
Once again, it is worth noting that most of the international air cargo has been channelled to ORTIA since
the start of the lockdown period, with very little foreign cargo consigned to or from Durban and Cape Town.
The occurrence is changing slowly as more passenger flights arrive at our coastal airports.
Figure 9 - Total cargo movement during the lockdown
Updated: 06/11/2020
0
10
20
30
40
50
60
70
80
SWISSPORT WORLDWIDE FLIGHTSERVICES
AERO-LINK MENZIES CARGO BIDAIR CARGO
Mill
ion
s
Cargo movement per Handler, 30 March to 4 November
Sum of Inbound Sum of Outbound
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Total movement of international cargo, 30 March to 4 November
Inbound Outbound Linear (Inbound)
10
The final figure above shows the overall international air cargo flow to South Africa since the start of the
lockdown period. As can be seen, the flow has been on a continued upward trajectory after the initial
abnormal spikes caused by the movement of large quantities of PPE, and this trend provides some
illumination on an otherwise gloomy picture.
• Domestic air cargo
The following table shows the domestic inbound and outbound air cargo flows for the duration of the
lockdown period, as reported by industry. The table includes the main domestic hubs, with a summary for
the other airports. For comparative purposes, the average domestic air freight cargo (inbound and
outbound) for ORTIA handled before the lockdown period was approximately 75 000 - 90 000 kg per day
(calculated from industry feedback). For further comparisons, the average domestic air freight cargo
(inbound and outbound) for ORTIA handled in October 2019 was approximately 98 000 kg per day.
Table 6 - Total domestic cargo movement
DATE / AIRPORT CPT DUR ELS JNB PLZ OTHERS TOTAL
Mar Average 8 581 823 1 728 4 020 2 912 1 555 19 619
Apr Average 14 664 900 2 152 13 911 3 814 1 760 35 956
May Average 28 421 1 639 4 677 25 282 7 333 1 099 58 064
Jun Average 24 256 2 137 5 105 23 935 8 601 3 324 63 236
Jul Average 23 395 2 759 4 896 24 255 6 550 5 139 63 116
Aug Average 22 860 2 418 40 93 22 142 5 643 2 819 59 559
Sept Average 24 735 2 682 3 712 24 003 6 126 3 315 64 572
Oct Average 25 317 2 931 3 552 22 085 6 475 3 315 63 676
28-Oct-20 38 481 5 009 4 903 38 637 9 429 5 385 101 843
29-Oct-20 39 414 4 767 5 641 33 475 9 015 4 704 97 016
30-Oct-20 13 840 2 126 3 112 21 301 5 204 2 275 47 858
31-Oct-20 1 319 431 2 584 375 125 4 833
01-Nov-20 1 204 178 27 544 7 142 2 102
02-Nov-20 43 599 5 543 6 628 44 215 10 922 5 737 116 645
03-Nov-20 40 340 5 750 5 738 35 611 9 666 4 994 102 101
Grand Total 4 909 795 493 130 745 993 4 672 028 1 243 096 846 207 12 714 463
Updated: 04/11/2020
The following figure is an illustration of the total air cargo moved per day as per the table above:
11
Figure 10 - Total domestic air cargo since lockdown commenced
Updated: 04/11/2020
The average domestic air cargo moved during the lockdown period has amounted to 62 204 kg per day
(~↑2% compared to last week), which constitutes approximately 69% of the volume moved pre-lockdown.
Global air cargo traffic
The following air traffic image displays the international air traffic at around mid-afternoon of 6 November.
Figure 11 - Global air traffic: 6 November 2020
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250
27-Mar-20 27-Apr-20 27-May-20 27-Jun-20 27-Jul-20 27-Aug-20 27-Sep-20 27-Oct-20
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12
Source: FlightRadar24, 06/11/2020, 16:00
Southern African air traffic
The next image shows the air traffic across Southern Africa at around mid-afternoon of 6 November.
Figure 12 - Southern African air traffic: 6 November 2020
Source: FlightRadar24, 6/11/2020, 16:00
The image above illustrates that air traffic in and around Southern African has undoubtedly increased in
recent weeks, which is a positive sign for the industry.
Road Update
i. Beit Bridge Border operations
On a regional road freight note, recent investigation has continued into the operational aspects of several
SADC border posts, notably the cross-border delays experienced at Beit Bridge. The following analysis
illustrates the trade flows (and accompanying delays experienced) currently at Africa’s busiest border
crossing. The research utilised data from TLC and FESARTA.
Table 7 - Cost of delays Northbound at Beitbridge (from 21/10/2020 to 06/11/2020 - 17 days)
Queue Time
(Hours)
Border Time
(Hours)
Border time
exceeding two
hours
HGV Arrivals per day
HGV Tonnage per day
HGV Tonnage
HGV Arrivals
HGV Delay Hours
Queue Time
Delays
74h15 23h00 21h00 600 18 000 126 000 10 200 214 200 756 330
13
Source: TLC & FESARTA, Updated 06/10/2020
The following graph shows the staggering estimated cost to industry over a period of a mere 17 days.
Figure 13 - The projected cost of delays Northbound at Beitbridge (from 21/10/2020 to 06/11/2020 - 17 days; @ $20 per hour)
Source: Powered by Bing; compiled with statistics generated from NPA, TLC & FESARTA
The queue time over the period in question has average ~74 hours (or three days), which has cost the
transport industry an estimated $15 126 600 (or R242 025 600); while the average border crossing time has
average ~23 hours, which has cost the transport industry an estimated $4 284 000 (or R68 544 000). The
total cost for the period mentioned above amounts to an astounding R310 million.
For trade to prosper through the North-South corridor, this is unacceptable and can no longer be tolerated.
Further to the cost — especially in this critical period — is the humanitarian aspect of drivers spending three
days in the queue with little or no sleep, since, if the rest they will lose their place in the line. Moreover,
there are no sanitation facilities, no running water to wash or bath, with the drivers even forced to cook
food on the side of the road or in their trucks.
With the atrocious costs to industry and the dire conditions for the drivers as they are, the industry calls on
all border post stakeholders on both sides of the border (namely DHA, SARS, SAPS, Port Health, Limpopo
Traffic Police, CBRTA (South Africa), ZIMRA, ZINARA Port Health and VID (Zimbabwe)) to collectively take
responsibility for this disaster of catastrophic proportions. It is quite clear that one of the major problems is
posed by the corrupt activities of law enforcement officers “selling” expedited transit to the front of the
queue. Add to this the activities of criminals preying on stationary vehicles, especially at night, and you have
a genuinely nightmarish situation, perhaps even surpassing that experienced at the Kalumbalesa
Zambia/DRC crossing earlier in the year.
1. International update
The following section provides context as to the health of the global economy and the impact of COVID-19.
a. Container industry at a glance
International ocean freight rates have once again slightly increased this week according to Drewry, the UK-
based Maritime research and consulting firm9. The “World Container Index” (WCI) increased by 0.5%
compared to the previous week (29 October 2020). Consequently, the current global average freight rate
9 Drewry Supply Chain Advisors, World Container Index. https://www.drewry.co.uk/logistics-executive-briefing/logistics-executive-briefing-articles/world-container-index-detailed-assessment
14
now stands at $2,627.94 per 40ft container. This rate was roughly the same as the beginning of September
when the most recent surge in the index took place.
The following figure summarises the current trend.
Figure 24 - World Container Index - Assessed by Drewry ($ per 40ft container)
Source: Drewry Ports and Terminal insights
Although the rate of increase has in recent weeks levelled off, the WCI is still up by 81.5% compared to the
same period in 2019. In general terms, ocean-going freight rates have maintained their levels in recent
weeks, with the excess demand resultant from the forced decrease in air traffic and the subsequent lack of
supply continuing to be mopped up by the ocean freight carriers.
The following table consolidates the monthly and annual changes for the eight major East-West trades.
15
Table 81 - World container index per route - Assessed by Drewry ($ per 40’ container)
Source: Drewry Ports and Terminal insights
As a summary of the WCI, Drewry provides the following reasons for their recent assessment:
• The average composite index of the WCI for year-to-date is $1,927 (↑$16 from last week) per 40ft
container.
• The current figure is an increase of $454 on a five-year average of $1,473.
• Regionally, three of the eight major East-West trading routes have increased this week, with only
Shanghai - Los Angeles decreasing. The other four routes remain approximately the same
• For next week, Drewry expects rates to increase marginally once again.
Aviation industry at a glance
For the month of September, economic recovery was varied in the aviation industry, according to the
economic analyses published this week by the International Air Transport Association (IATA). Growth
accelerated in the air cargo sector, whereas progress in the passenger sector slowed down.
According to IATA10, industry-wide cargo tonne-kilometres (CTKs) fell by 8.0% year-on-year compared with
a 12.1% decline in August. Month-on-month, CTKs showed the fastest growth since May, at 3.7%.
For air travel, on the other hand, industry-wide revenue passenger-kilometres (RPKs) fell by 72.8% year-on-
year despite a continued surge since an all-time low was recorded in April. The following figure aptly
illustrates the current diverging predicaments of the respective sectors.
10 IATA, COVID-19: Air travel slows in September, but cargo speeding up, 2020. https://www.iata.org/en/iata-repository/publications/economic-reports/air-travel-slows-in-september-but-cargo-speeding-up/
16
Figure 15 - Growth in global passenger-km (RPKs) and cargo km (CTKs) flown
Source: IATA Economics
Although all regions have reported better numbers for September compared to August, the industry
rebound remains largely driven by North American airlines. Key demand drivers of air cargo remain
supportive despite the resurgence of COVID-19 cases, especially seen in Europe. The following figure
indicates the respective resurgence per region. The impact of the re-introduction of strict quarantine
measures in Europe remains to be seen.
Figure 16 - Growth by major trade lane (CTKs)
Source: IATA Economics
Whilst the North Atlantic has soared, the trade lane connecting Europe with Asia has regrettably stalled. The
Middle East-Asia lane has joined the North Pacific in positive territory when compared to this time last year.
17
In summary, IATA predicts that cargo demand for the final quarter of 2020 will remain reasonably strong
amid traditionally large e-commerce events with widespread launches of popular consumer electronics.
Moreover, the industry has been assisted by better than expected orders for exports of manufactured goods.
Despite some positive reports for the air cargo industry, several concerns still linger, most notably the lack
of passenger fleet belly capacity. Since RPKs have not picked up significantly, lack of cargo capacity remains
a key obstacle for faster recovery in air cargo business. Globally available cargo tonne-kilometres fell by
25.2% year-on-year in September – more than three times faster contraction than in demand.
Conclusion
This update — the 14th of its kind — contains a consolidated overview of the South African supply chain, as
well as the current state of trade internationally. The country’s COVID-19 curve has flattened in recent
weeks, with new cases in the last week amounting to an average of just over 1,521 per day. The daily rate
has therefore remained within similar bounds since the second week of August (at around ~1,800 new cases
per day). Despite the seeming containment of the virus, the country needs to be watchful of a potential
second spike in cases, as has been the experience in many countries. In a global context, South Africa
dropped a further position to 13th position internationally, with Italy overtaking us in the last seven days as
most parts of Europe experienced a resurgence of the virus. Total cases in South Africa now amount to
approximately 732,40011 recorded at the time of writing.
For the ocean modality, container volumes have decreased marginally compared to those recorded in the
previous week. The overall monthly containerised cargo volumes have once more declined, currently at
~79% compared to the same time last year. The average this week stands at ~7,651 TEUs handled daily, with
an increased average of around ~9,287 (↑21%) expected to materialise over the course of the next week.
On the international air cargo front, the average daily volume of air cargo handled at ORTIA over the seven
days decreased by ~3% compared to last week. The period beginning 29 October amounted to 408 477 kg
inbound and 268 730 kg outbound, resulting in an average of 677 208 kg per day. These figures correspond
to approximately 91% compared to the two months before the lockdown period and around 70% compared
to the same time last year. As is the case with ocean cargo, the seasonal variation is apparent. Average
domestic air cargo moved during the lockdown period has amounted to ~62 204 kg per day, which
constitutes approximately 69% (↑2% compared to last week) of the volume moved pre-lockdown.
Regionally, the current cross-border constraints experienced at Africa’s busiest road border crossing
continue to hamper trade. Analysis utilising data from NPA, TLC and FESARTA, including the use of GPS data
obtained from Globaltrack indicate that queue times have recently averaged around 74 hours (or three
days), with the average border crossing times 23 hours over the same period. The estimated cost to trade
has amounted to more than R310 million. The entire cross-border road transport sector operating in the
North-South trade corridor hopes the situation will be alleviating somewhat in coming weeks. The current
operational challenges are severely debilitating trade, quite apart from the humanitarian impact of the
bottleneck on our northern landlocked neighbours, not to mention the bonus presented to our regional
competitors whose borders are not similarly constrained.
Internationally, the WCI is currently at $2,627.94 per 40’, which is a 0.5% increase on last week. The maritime
industry continues to lap up the lack of supply coming from the international air industry. Also, there have
been some concerns voiced by the industry that the major carriers are taking the opportunity to get their
rates up by artificially stimulating demand (to boost profits) with blank sailings and port omissions.
Fortunately, long term contracts are unaffected by these occurrences, as the reported WCI only concerns
11 John Hopkins, Coronavirus Resource Centre. https://coronavirus.jhu.edu/map.html
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the spot rates. As such, IATA notes that although growth accelerated in the air cargo sector, the progress in
the air travel sector continues to drag behind. Currently, industry-wide cargo tonne-kilometres (CTKs) stands
at ↓8.0% year-on-year compared to 2019, whereas industry-wide revenue passenger-kilometres (RPKs)
stands at a staggering ↓72.8% year-on-year below 2019 levels.
In conclusion, the available supply chain indicators point out that there will be no “quick-fix” recovery from
the COVID-19 induced economic contraction. Furthermore, the indicators continually show that the effects
will last long into 2021, and probably even 2022. We continue to hope that the South African supply chain
and greater trading community continue to pull together and ensure that everything possible is done to
mitigate the impact of COVID-19 on the industry.