As the first South African citrus sendings arrive in Japan, there is concern that back home discord in the logistics field will cause problems during peak shipments.
The recent appointment of a new logistics service provider to manage train container transport from the key northern citrus region around Letsitele to the port of Durban has proved contentious and led to some major players in the industry to launch an interdict to have the appointment nullified.
The South African industry has for some time now been trying to move some of the citrus volumes carried by road to Durban onto a largely under-utilised rail system. This, industry leaders believe, will ease the congestion of road transport in and around the port of Durban, as well as help to limit further damage by heavy loads to the road system which has deteriorated recently.
When the national transport operator, Transnet, recently announced the successful candidate as East Coast Container Depots, it resulted in much discord in the industry. Accusations that the successful candidate did not have the experience to deal with the problems, which loom on the horizon, led to claims that Transnet’s tender process was flawed.
Capespan-owned Durban terminal operator, Fresh Produce Terminals, with supporting papers from the industry and the Fresh Produce Exporters Forum (FPEF), launched a successful interdict to declare the tender process null and void. Now the whole process is back at square one – with the peak season shipments less than a month away.
“It is really important for the industry to make progress with the rail option because it not only reduces congestion in road traffic, but also dramatically improves our carbon footprint,” said Stuart Symington, chief executive of the FPEF. He admits the volume of citrus, which is currently transported by rail, is still a small percentage of the total shipments. “It is nonetheless a crucial issue which will boost the future competitiveness of the industry,” he said.
“We got involved on behalf of our members because Transnet did not respond to our request for consultation in the run-up to the appointment,” he said.
The judge hearing the case has ordered Transnet to start all over again and there is no indication just how long it will take to make an appointment or even if Transnet will change from its original choice.
“Transnet has indicated that they first wish to consult their legal team,” said Mr Symington. “We do not see why further legal consultation is necessary and believe there is no reason why this cannot be sorted out within the next month.”
The CGA's Mitchell Brooke said Transnet had indicated that one of its divisions, Transnet Freight Services, would run an interim service while the issue was being resolved.
While there is a battle off the field, the 2011 season is steaming ahead, with the first arrivals in Japan due at the end of May. With only 10m cartons out of a total predicted export crop of 94.7m cartons having been packed at the end of week 19, there is clearly still a long road ahead. The June and July shipping period has in the past been marked by bottlenecks at the ports, with Durban being the centre of the action.
However, last year, during the last two weeks of May, the industry also endured a crippling strike at the container terminals. This time round they may find it easier to cope, as all is quiet on the labour front. Growers and exporters are crossing their fingers that it will remain this way.
Meanwhile, the South African citrus industry is still waiting to hear if the final issues surrounding the protocol for shipments to Thailand have been resolved and when the agreement will be signed. Citrus Growers’ Association spokesperson Justin Chadwick said the comments on the draft protocol for the importation of citrus from South Africa into Thailand had been returned to the Thailand authorities.
“We have no idea when this will be finalized and when we will be able to ship the first fruit,” he said.
South Africa and Thailand have been at loggerheads for the past three years since South African apples, pears and grapes were excluded from the country. Intense negotiations since then have yielded little and it has recently been reported that South Africa is considering taking the matter to the World Trade Organization for resolution.
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