Equipment revival at South African port terminals underpinning move from stabilisation to recovery

Transnet Port Terminals (TPT) CEO Jabu Mdaki believes the steady flow of new equipment, together with improved relations with key original equipment and part suppliers as well as shipping lines, has resulted in a stabilisation of operations at terminals that faced unprecedented and costly congestion little over a year ago.

At one stage, the vessel backlog at the Durban Container Terminal’s (DCT’s) Pier 2, the country’s biggest and busiest container terminal, stood at 20 and at the start of 2024 the prognosis for recovery looked bleak. The associated congestion costs were significant, with the South African Association of Freight Forwarders estimating them to be at least R124-million a day.

While Mdaki admits that risks persist, particularly during periods of inclement weather, he tells Engineering News that he is cautiously optimistic that the 10 000-employee Transnet unit has now moved firmly from stabilisation to recovery.

The next step, which is still some way off, is to consistently increase volumes and steadily transition the terminals to operating levels that are more in line with global best practice.

At DCT Pier 2, the immediate goal is to raise yearly volumes from about 1.6-million twenty-foot equivalent units (TEUs) to about 1.75-million TEUs, against a nameplate of about 2-million TEUs.

To do so, gross crane moves an hour, which currently stand at between 18 and 20, will have to increase to 25 in the near term, with a TPT-wide target of 30 gross crane moves an hour having been formally set for 2030.

Hopes for achieving such efficiencies at DCT Pier 2 were initially pinned on the conclusion of a 25-year joint venture with International Container Terminal Services Incorporated (ICTSI), of the Philippines, which was selected as the terminal’s preferred bidder in July 2023.

However, APM Terminals, the port operating company for AP Moller-Maersk and a rival bidder for DCT, is legally contesting Transnet’s selection of ICTSI and the matter is yet to be resolved.

Mdaki says it, thus, became crucial for TPT to ramp up its investment so as to halt DCT’s decline and begin recovering the performance at both Pier 2 and the smaller Pier 1, which together handle about 60% of South Africa’s container volumes.

INVESTMENT PUSH

For this reason, the lion’s share of TPT’s five-year, R21-billion investment budget is being directed towards an equipment overhaul at DCT, initially of the landside equipment but progressively of the marine-facing equipment too.

An outward sign of the progress being made was on display in late February, when DCT started taking delivery of the more than 100 pieces of new cargo-handling equipment that is scheduled to be supplied during the 2025 calendar year.

A total of 20 Konecranes straddle carriers will be delivered to Pier 2 by the end of May, with 12 already in hand, while 16 Liebherr rubber-tyred gantry cranes are being delivered to the Pier 1 terminal.

In addition, four Liebherr ship-to-shore cranes, 18 Terberg haulers and 14 Toyota and Konecranes forklifts are scheduled to be delivered to Pier 2 between April and December, while Pier 1 will receive 16 rubber-tyred gantry cranes.

An equipment recapitalisation is also under way at TPT’s other container terminals. In Cape Town, eight forklifts and components for the 28 rubber-tyred gantry cranes will be delivered, while at Port Elizabeth, in Gqeberha, a ship-to-shore crane investment is planned.

Investments are also being made at its dry-bulk terminals, such as Richards Bay, which will take delivery of 17 haulers from Terberg. As part of the freight logistics roadmap and government guarantee, TPT is preparing private sector partnership (PSP) tenders for a mega chrome-ore terminal in Richards Bay and a new manganese terminal at the Port of Ngqura.

Over the coming five years, TPT is budgeting to invest about R4-billion yearly across its 16-sea cargo and three inland terminals, where further PSPs are also being considered.

Mdaki tells Engineering News that the purchase of new equipment has also been coupled to a new long-term contracting model with original equipment manufacturers (OEMs) and original parts suppliers, the absence of which in the past is considered as a key reason for the decline in performance.

For instance, TPT now has a ten-year contract with Liebherr that covers all new acquisitions and includes technical support over the 15-year lifecycle of the equipment. The contract is for mobile harbour cranes, rubber-tyred gantry cranes, rail-mounted gantry cranes and ship-to-shore cranes.

It has also concluded seven-year contracts for maintenance on all other existing fleet with four main OEMs namely Kalmar, Liebherr, Konecranes and ZPMC.

Mdaki reports that having longer-term relationships with suppliers has resulted in the OEMs investing more heavily both in high-calibre engineering personnel to support TPT, as well as in the physical infrastructure, such as warehouses for spares, required to ensure the equipment remains operational.

He is also moving to improve relationships with the shipping lines, which he says have already helped secure emergency equipment for TPT and have also assisted it in improving its vessel and stack planning.

For Mdaki the priority currently is to “stay the course” with regards to the equipment replacement programme, which he says is only just getting started and is aimed at correcting past deficiencies.

“My second priority is then to ensure that there is indeed an operational improvement, because every piece of equipment needs to have an associated improvement in the efficiency of our operations.”

He says TPT staff have expressed strong support for the unfolding investment in the new equipment, most of which is already familiar to the operators, and expressed optimism that there would be minimal disruption to the ongoing recovery as a result of upcoming wage negotiations.