Faltering rail service undermines competitiveness of the forest sector

March 31, 2022

A logistical nightmare is busy unfolding for forestry and downstream industries in South Africa as the freight rail service that it depends on to get over a million tons of timber a year from the Mpumalanga/KZN highveld to the processing mills in Richards Bay appears to be falling apart at the seams. Industry stakeholders that spoke to SA Forestry were at their wits end after the so-called ‘Wood Owl’ train that uses the coal line to Richards Bay ground to a halt for over a week in early March due to problems with availability of locomotives.

According to the state-owned Transnet Freight Rail the Wood Owl train service is back in operation now, but industry insiders say it is still operating below capacity, and there appears to be no end in sight to the unreliable service on this important route.

The problems on the Wood Owl are just the tip of the iceberg as users of the remaining branch rail lines still serving timber in KwaZulu-Natal are ‘gatvol’ over the poor, unreliable service they have been experiencing for years. This is further compounded by reports of shoddy service and disruptions at the ports of Richards Bay and Durban through which most of the forestry products, namely pulp and wood chips, are exported.

Forestry stakeholders that are heavily dependent on these rail transport routes are scrambling to find alternative ways of getting timber to their mills which have to maintain scheduled production levels to meet export orders. This involves moving timber onto long haul road trucks where possible, or sourcing more timber locally in Zululand and reducing harvests in the highveld plantations that are far from the mills.

Rail to road
Firstly, shifting timber from rail onto long haul road trucks increases transport costs significantly, while increasing congestion and wear and tear on our national roads, not to mention the additional carbon dioxide emissions that these vehicles are pumping into the atmosphere. Secondly, moving timber from rail to road at short notice is easier said than done as long haul trucks are expensive items and road freight operators require long term contracts in order to justify the purchase of additional vehicles.

The industry currently moves 1.3 million tons of timber a year on the ‘Wood Owl’ train – which uses the coal line that connects the coal fields to Richards Bay - to feed four mills in Richards Bay. This transport link is vital to ensuring that commercial forestry is competitive in the highveld regions of Mpumalanga and KZN, which are located some 250 kms from Richards Bay.

The service challenges on the coal line are nothing new, and don’t only affect the timber industry. Mining and agriculture sectors are also being severely impacted.

Common sense suggests that South Africa as a country should be moving more bulk goods on rail – not less – but common sense is trumped by a litany of issues at the state-owned Transnet Freight Rail that are impacting on operational and administrative efficiencies, coupled with the criminality of people who are stealing the rail infrastructure piece by piece.

The explanation from TFR for the latest service disruptions on the coal line is non-availability of locomotives. Forestry stakeholders are saying that available locomotive resources – such as they are - are being allocated to the coal sector at the expense of timber, which constitutes just 2% of the freight that is transported on that line.

A TFR spokesperson told SA Forestry that the Wood Owl train is back in operation. “The service was temporarily withdrawn for TFR to refit some of the locomotives enabling them to be used on the export coal line as well. TFR has been transparent with customers regarding the challenges that the company is facing in respect of the unavailability of locomotive spares (due to the suspension of the 1064 contract) which in turn impacts locomotive availability. This has meant that TFR reallocate available rolling stock across the business to meet the company’s commitments,” said the spokesperson.

Seeking solutions
Forestry industry stakeholders are understandably reluctant to speak out on the latest woes of the freight rail service as they are engaging with TFR and at the highest levels of government in a bid to try and find lasting solutions to the logistical bottlenecks around rail and the ports. Many industry stakeholders that spoke to SA Forestry believe that the only solution is to allow private freight operators access to key rail corridors in a bid to provide a decent freight service for timber. Industry representatives are currently engaging with TFR and the Minister of Public Enterprises to explore this option.

Forestry South Africa, which represents the majority of forest owners, has issued the following statement to the media following the latest disruptions on the coal line:-

“The Forestry Industry finds itself in a grave situation regarding rail transport on the coal line. With the increase in commodity prices, especially coal, it is apparent that all locomotive resources at TFR (Transnet Freight Rail) are being allocated to the Coal Sector, leaving smaller industries that utilise this line, such as Forestry, in a dire situation. There is a shortage of locomotives, and thus far, no immediate solution is in sight. Our industry moved approximately 3.5 million tons of timber by rail in 2005, and this volume has currently declined to under 2 million tons. The industry presently moves 1.3 million tons per year by rail from the Highveld to the Richards Bay region via the Coal Line, feeding four processing plants. This supply chain has now been severely affected by the disruption in the rail supply chain. The effects of this are felt right back into the value chain. Approximately 5% of the population of Mpumalanga and 2.7% of KZN are dependent on the Forestry sector, and as a significant employer in the rural areas, these people will be hit the hardest. This situation cannot continue, and we are working hard with TFR to look at solutions.”

NCT’s Commercial Manager, James van Zyl, told SA Forestry that the coal line is still operating way below capacity and there are also on-going service problems on the KZN branch lines which are used by NCT members. One of the problems that resulted in the temporary interruption of service on the branch lines, according to James, was grass growing over the tracks, a result of good summer rains. (You will be relieved to know that TFR says it is preparing a tender for vegetation control on affected lines to prevent a re-occurrence of this setback. )

James said that before the current service failures NCT was moving around 400 000 tons of timber a year on rail to their mills at Richards Bay and Durban, as well as the Sappi-Saiccor mill at Umkomaas.

Dedicated transhipment depot
In order to take advantage of the benefits that rail transport offers members, NCT opened a dedicated transhipment depot within the greater Transnet Vryheid East Marshalling Yard in November 2019, designed specifically to transfer timber from road to rail. It is managed as an extension of NCT’s Richards Bay supply chain. The throughput at the depot ramped up to 120 000 tons per annum within a few months of commissioning, which removed around 3 525 loaded heavy vehicle truck trips per annum between Vryheid and R/Bay, plus the same number of empty return loads.

Apart from the benefits to road safety, congestion, road surface wear and tear and a reduction in emissions, the big benefit for NCT’s timber suppliers, especially those located north of Vryheid, are significant transport cost savings.

This transhipment facility has the capacity to handle 20 000 tons of timber per month or more. However as a result of the current wave of freight rail unreliability that is being experienced, NCT is planning to move only 2 000 tons through the transhipment facility next month. The rest of the timber harvested from this catchment will go back onto the road. This could have long term consequences for timber logistics in the region.

“You can’t just move timber from rail to road short term,” said James. “New PBS vehicles cost around R4 million so you have to commit for three to four years. Once timber goes off rail onto road it’s going to be hard to get it back onto rail,” he said.

In case you think this scenario is just affecting a few forestry corporates while the rest of us get away unscathed, consider this: the forestry industry in South Africa grows and harvests the primary raw material for forest products that contribute 4.5% of total manufacturing GDP and 25% of agricultural GDP. The sector provides a positive trade balance of close to R10 billion, and supports an estimated 700 000 livelihoods in South Africa.

Forestry Sector Materplan
The Forestry Sector Masterplan that was approved by government in June 2019, which is deemed a priority sector under the Public Private Growth Initiative, identified transport (road and rail) logistics as a key inhibitor to investment and growth in the sector. It called for greater alignment between industry and Transnet Freight Rail, as well as active resolution of rail related issues through the establishment of a ‘One-Stop Shop’ at Transnet. The Masterplan specifically calls on TFR to improve reliability in collecting from depots, and greater adherence to delivery schedules.

The ‘One-Stop Shop’ facility hasn’t happened – no surprises there - but industry is actively engaging with Transnet and Minister Pravin Gordhan directly in a bid to resolve rail freight issues. Allowing access to the rail network for third party freight operators as a possible solution to the ongoing service delivery failures at TFR is firmly on the agenda.

An independent freight rail operator active in Africa reported recently that it takes six days for freight to travel by rail from DRC to the border of South Africa, and it takes 26 days to get from the border of SA to Richards Bay.

Go figure that one out!!

Subscribe
Notify of
guest
0 Comments
Inline Feedbacks
View all comments

Husband and wife team Nomthandazo Hlombe and Fisokuhle Ngcobo, NCT’s Tree Farmers of the Year 2021, demonstrate how to establish and build a sustainable tree farming operation in faraway Matimatolo, near Kranskop in the KZN midlands. By Samora Chapman. ...

The largest mangrove reforestation project in Africa has been launched by Mozambique’s Ministry of Sea, Inland Waters and Fisheries (MIMAIP) in partnership with Blue Forest, a UAE-based mangrove reforestation specialist. Read more saforestryonline.co.za.

📸 Lake St Lucia, Chris Chapman.
...

The National Minimum Wage (NMW) in South Africa for 2022 has been set at R23.19 per hour, which translates to R185.52 for an eight-hour day, and R3 710.40 for a month with 20 working days. This represents a 6.9% increase over the 2021 NMW. Can employers afford it? Link in bio... #forestry #labour
📸 Chris Chapman
...

With the onset of what promises to be a cold winter, this photo provides a timely reminder of what happens to wattle trees when it snows. No! It’s not a good idea to plant wattle if snow is a possibility. The only thing you could use these broken trees for is firewood. The photo was taken near Weza a few years ago. Find out more about trees and snow... saforestryonline.co.za Link in bio. #trees #wood #forestry #timber #logging #forestryafrica #wattle #snow ...

cross
linkedin facebook pinterest youtube rss twitter instagram facebook-blank rss-blank linkedin-blank pinterest youtube twitter instagram