The Business Times newspaper ran a piece today warning that the growing strikes in South African ports could weigh on agricultural exports, particularly the Citrus industry. But this is not where the story ends. There are also infrastructure challenges in the South African ports which, if not addressed, could, in the long run, undermine the country’s desire to have an export-led growth in the agricultural sector.
Just last week the Minister of Agriculture, Land Reform and Rural Development, Thoko Didiza, noted that some of her focus areas will be to expand South Africa’s agricultural footprint in export markets. This all sounds exciting if one assumes the shipping ports are well-functioning. But they are not, specifically in agriculture-focused terminals. In his newsletter to members at the end of May 2019, Justin Chadwick, CEO of the Citrus Growers Association of Southern Africa, expressed concern about the poor performance of the Durban port, which has led to delays in shipments of citrus products.
The challenges that Durban port is facing are primarily technical, including the narrowness of Bayhead Road, which often leads to congestion, a lack of investment in maintaining and upgrading the port, insufficient cold storage infrastructure, and the long-term need for a dug-out port.
Not too long ago, I boasted about South Africa’s agricultural export success after it reached a record of US$10.6 billion in 2018. What this tells me is that for South Africa to remain an important player in global agricultural markets, we need to not only focus on boosting production on farms but also have a strong hand on logistics. This can be done by ensuring that there are good management and investment in infrastructure, and also addressing labour-related challenges in the near term – the disputes at the moment seem to be about the pay and promotions. But there are also industry reports which suggest that most of this has been sorted. Whatever the situation, the bottom line is that there will be delays in export activity.
Overall, this is not only an agricultural story. Other exporting sectors of the economy will ultimately benefit from improved shipping ports infrastructure.
Follow me on Twitter (@WandileSihlobo). E-mail: wandile@agbiz.co.za
