Concerns as ongoing Transnet impasse costs mining businesses R815m a day

With the ongoing impasse between Transnet and its employees, the mining and business sector has expressed concerns as they lose millions a day.

Business Unity South Africa says it is losing millions to the tune of R815 million a day as the Transnet strike continues to keep the country on its knees.

Workers affiliated with United National Transport Union (Untu) and the South African Transport and Allied Workers Union (Satawu) are embarking on a strike as they demand a wage increase but the employer, Transnet doesn’t seem to budge.

Organised business has called for an immediate and sustainable resolution, as mining exporters warned that they were losing R815-million every day the Transnet strike continued.

In a joint statement, Business Unity South Africa (Busa) and Business Leadership South Africa rejected short-term solutions, such as temporarily increasing levies, which they said could have unintended consequences.

“We need a quick, sustainable resolution to this strike, not ad hoc solutions,” Busa CEO Cas Coovadia said.

“The strike risks severe damage to the economy not just in the short term but also the longer term if it drags on and South Africa’s reputation for logistics gets further tarnished.

“This will add significant costs to either airfreight items or truck goods to and from other African ports – which will add to the inflation pressures South Africans are facing.”

As both organisations rejected earlier media reports suggesting that they would support a so-called ‘Avoidance of Strike Levy’, they also expressed anxiety over the prospect of the strike enduring for more than a few days.

On the part of the Minerals Council South Africa, it estimates that bulk mineral exporters were losing R815-million daily, because they had been unable to rail and load 357 000 t of iron ore, coal, chrome, ferrochrome, and manganese onto ships.

“On average, South Africa exports about 476 000 t of bulk minerals a day worth R1.06-billion,” it said per Mining Weekly.

“We estimate that just 120 000 t of minerals worth R261-million are being exported daily, [given that] mineral export harbours are operating at between 12% and 30% of their daily averages.

“The Minerals Council is deeply concerned that the labour action at Transnet will compound the losses our bulk mineral exporting members are already experiencing because of Transnet struggling to meet targeted annual tonnages on its rail network and throughput at ports.”

Minister of Public Enterprises Pravin Gordhan, Labour Minister Thulas Nxesi, and Thoko Didiza of Agriculture also shared their views via a joint statement.

“It is the view of government, that it will be in the interests of the country to find a speedy resolution to this impasse and for parties to continue to engage and, where appropriate, to employ the facilitation services of the Commission for Conciliation, Mediation, and Arbitration (CCMA),” they said.

“Our country cannot afford further job losses in other sectors of the economy and the interruption of imports and exports to and from South Africa.”

Main Image: Transnet Port/SABC News