The disruption in the Red Sea has seen a steady increase in maritime trade vessels coming to the ports of South Africa, but experts have warned that the country’s ports lack the capacity to accommodate the vessels and the equipment to service them.
Casey Sprake, investment analyst from Anchor Capital, said that maritime trade traffic has decreased in the Red Sea.
There have been issues along the Red Sea route because of attacks on ships by Houthi rebels.
“According to the latest data from the International Monetary Fund (IMF) over the first two months of 2024, maritime trade traffic decreased by 50% year-on-year in the Suez Canal and the Panama Canal has decreased by 32% year-on-year. There has been at least a 74% increase in maritime traffic at the Cape of Good Hope year-on-year.”
Sprake said the Suez Canal and Panama Canal make up to 20% of the world’s global maritime traffic.
“So that will give you an indication (of) how many vessels are coming to South Africa. We should be reaping rewards from the traffic, however, our ports are struggling with capacity shortages, under-investment, poor equipment and maintenance and it costs the economy billions.”
Malcolm Hartwell, Norton Rose Fulbright director, said there was no doubt that climate change in the Panama Canal and attacks by Houthi rebels on vessels in the Red Sea have had a significant effect on merchant ship routing.
“The latter events, which add about 10 days to a voyage from the Far East to Europe, have seen a huge increase in traffic around the South African coast.
Some shipping lines have used this as an opportunity to add African ports to their schedule from the Far East to Europe.”
Hartwell added that the diversions around the Cape have created an opportunity for South African ports to service some of the ships.
“Those services would include refuelling, crew changes and repairs.
The private sector is well positioned to service that increased demand for the services. Unfortunately, the TNPA (Transnet National Ports Authority) has not seized this opportunity or catered for the increased demand. Cargo volumes have not been changed by the crisis, but delays in berthing have meant that it is not viable for ships to call at Durban for refuelling.”
Hartwell said the Durban port faced challenges even before the problems at the Red Sea.
“Before these events intervened to increase traffic around our coast, there was increasing congestion as South African ports saw shipping lines diverting cargo through our neighbouring countries and an unprecedented volume of ships at anchor off Durban. Although the services to be offered by passing ships are not related to cargo, those ships are also affected by delays in berthing at our ports.”
Professor Irrshad Kaseeram, from the University of Zululand’s Economics Department, said the decrease in maritime shipping was expected given the Houthis attacking Israeli-friendly ships.
“Now the problem has escalated with the Iranian attack on Israel. South African ports are among the worst performing globally according to World Bank 2022 rankings, hence it’s expected that the harbours will struggle to cope, thus there will be long costly queues due to outdated technology.”
Dr Sanele Gumede, an Economics lecturer at the University of KwaZulu-Natal, said a great opportunity for South Africa was being lost.
“Due to the issues in the Red Sea, there is no way to get to the West except via South Africa. These vessels need to be serviced.
“The problem is that our ports don’t have the equipment or the infrastructure and that is why there are massive delays when these vessels come here and in essence we are losing out.”
The Mercury