February 2023 | BUSINESS FLEET AFRICA
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Table 1 Change in Ctrack Transport and Freight Index in December 2022
Percentage change between
Rail
Road
Pipeline
Sea
Air
Storage and
handling
Ctrack Freight
Transport Index
December 2022 vs December 2021 (y/y)
–22.4%
16.2%
–6.2%
–13.3%
7.8%
–11.7%
2.9%
December 2022 vs November 2022 (m/m)
–11.9%
–1.5%
1.5%
–4.0%
0.2%
–6.2%
–3.5%
Quarter to December 2022 vs. Quarter to September 2022 (q/q)
–17.9%
–4.0%
–21.2%
–18.2%
4.2%
–9.2%
–7.5%
Note: The row highlighted in blue is the main Ctrack Transport and Freight Index values used.
Source: Ctrack and economistscoza, TNPA, StatsSA, SARS, N3 and N4 toll concessions, ACSA, ACOC, IATA.
Rail Freight transportation has now been
declining for five consecutive years,
with little hope for a turnaround of this
situation soon.
The obvious beneficiary of this
dismal reality has been the Road Freight
sub-sector, which, on average, accounts
for approximately 84% of total freight
transportation in South Africa. The num-
ber of heavy trucks on both the N3 and
N4 toll routes increased compared to a
year ago, while the Road Freight payload
for the country also showed continu-
ous growth throughout the year. The
Road Freight component of the Ctrack
Transport and Freight Index increased
by 16.2% year on year in December,
the 21st straight month of double-digit
annual growth rates recorded.
The Sea Freight sub-sector of the
Ctrack Transport and Freight Index
declined by 13.3% during December
compared to a year ago and declined on
a monthly (-4.0%) and quarterly basis
(-18.2%), reflecting the negative impact
of the Transnet strike on ports’ activities.
Overall, container handling in the country
recovered somewhat after declining by
a significant 58.7% on a monthly basis
during October, however, by the end
of 2022, it remained 28% below the
September 2022 pre-strike level. In addi-
tion to container handling, general cargo
handling was also negatively impacted by
the strike and has only partially recovered
in the past two months, confirming fears
that it will take the industry months to
recover from the crippling strike.
The Storage and Handling sub-sector
of the Ctrack Transport and Freight Index
remained under pressure for most of
2022, with a trend of declining inventory
levels evident, followed by the Transnet
strike that just made matters worse. The
Storage and Handling sub-sector declined
by 11.7% in December compared to
a year ago and declined on a monthly
(-6.2%) and quarterly basis (-9.2%).
The transport of liquid fuels via
Transnet Pipelines (TPL) increased
somewhat in the past two months, with
the Pipeline sub-sector of the Ctrack
Transport and Freight Index increasing
by 1.5% on a monthly basis, however
still tracking 6.2% lower in December,
compared to a year earlier.
The Air Freight sector turned out
to be one of 2022’s star performers,
a combination of ongoing post-Covid
recovery and, in the last quarter, also
a beneficiary of the logistical troubles
created by the Transnet strike. The Air
Freight sub-sector increased by 4.2%
on a quarterly basis and was the only
sub-sector to experience growth at
7.8% higher in December, compared to
a year ago. The stellar performance of
Air Freight helped to soften the impact
of the Transnet strike on the overall
performance of the Ctrack Transport
and Freight Index considerably.
Ctrack TFI and GDP growth
The December 2022 Ctrack Transport
and Freight Index finished at 111.6,
representing a notable decline com-
pared to the September performance
of 120.7, signalling that the transport
sector’s lack of performance could
have had a negative effect on economic
growth during the fourth quarter. As a
minimum, the transport sector will likely
underperform compared to the other
sectors of the economy, in contrast to
its outperformance in Q3. The negative
impact of the prolonged Transnet
strike will put a damper not only on the
transport sector’s contribution but also
the broader economy’s performance in
Q4, given linkages to other sectors. In
addition to the strike’s impact, the on-
going challenges of harsh load shedding,
the high cost of living, high production
costs due to high fuel prices and rising
wage demands, and elevated interest
rates, the list of challenges for the South
African economy remains extensive.
“The South African economy needs a
functioning logistics network amidst all
of the economic woes currently plaguing
our country, and all stakeholders should
unite to address the obstacles in the
industry,” concludes Jordt. BFA
Jan18=100
160
140
120
100
80
60
40
20
Ctrack & economists.co.za
Rail freight
Road freight
Jan-18
Jan-19
Jan-20
Jan-21
Jan-22
Jul-18
Jul-19
Jul-20
Jul-21
Jul-22
Apr-18
Apr-19
Apr-20
Apr-21
Apr-22
Oct-18
Oct-19
Oct-20
Oct-21
Oct-22
Graph 3 Rail vs Road freight payload (Index: Jan 2018 = 100)
CTRACK & ECONOMISTS.CO.ZA