Infrastructure Theft Sabotages Rail’s Growth Aspirations

6 July 2021 – Rail freight volumes have continued to plummet in recent months in contrast to road freight which has reached an all-time high.

According to the latest Ctrack freight transport index, rail freight’s ongoing downward trend is related to the theft of rail infrastructure and a continued move to road freight, which at present can offer far more competitive rates due to the low oil price.

Hein Jordt, Ctrack SA managing director, says rail freight volumes are currently down 177 points on the index compared to a year ago. “Rail freight is continuing to lose market share, a trend that has been exacerbated by more coal going to road. On the other hand road freight, which is now the biggest sector of the index, has reached an all-time high of 119.7 points. This growth signals a full recovery for road freight following the 2020 Covid-19 lockdown, although this was at the expense of rail freight.”

Barring any further hard lockdowns, road freight is expected to continue growing, although at a slower rate than during the recovery phase. This trend could slow further if the oil price increases significantly and some goods head back to rail. “The recovery in road freight is clear to see – with over 6000 trucks a day passing the Tugela toll plaza. This is very close to pre-pandemic levels. In addition, other truck indicators report very high truck counts in metropolitan areas such as Nelson Mandela Bay, Johannesburg and Tshwane.”

Record agricultural harvests in many sub-sectors, ranging from maize to grapes, further boosted the road sector. He said at present rail freight was tracking at least 10% below the average 2016 volumes while road freight was close to 20% above the same year’s averages. This comes despite strong moves from the government over the past decade to drive cargo towards rail to minimise the overdependence on road transport.

Transnet’s road-to-rail strategy has been well documented in Freight News over the years, with the primary aim being to rebalance the road/rail split. With the cost of logistics in South Africa amongst the highest in the world, Transnet Freight Rail has attempted to gain market share in order to reduce the overall cost of transport and logistics in the country.

The Ctrack figures are supported in the just-released Statistics South Africa preliminary land transport report that found road freight payload had increased by 2.3% in the first quarter of this year, while it had increased for rail by 6.7% during the same period. Source (Freight News)