The R480 billion industry that has flown under the radar in South Africa – until now
Total turnover for the logistics industry for enterprises only involved in mining, retail and manufacturing, was estimated to be R274 billion in 2018.
“However, warehousing, road freight and even pipeline volumes, are often not categorised as logistics,” Ctrack said.
“For example, when major retailers like Shoprite or Pick ‘n Pay transport and store goods, the transported volumes are listed under the retail category. Retailers like these see transportation as a cost centre and any savings they make would be categorised as retail savings. Similarly, when a steel manufacturer delivers steel, the value add of the transportation is measured under manufacturing.”
“There is also overlap between sea freight and cargo handling and the same is true of air cargo. Sometimes cargo spends time at the country’s ports and is charged storage or handling fees,” it said.
This means the country’s entire logistics sector is far more extensive than the estimated R274 billion, and is probably far closer to R480 billion, the group said.
State of logistics and freight in South Africa
According to the research, which is currently based on the limited resources available, South Africa’s total logistics volumes rose 3.1% in July 2019 compared to the same time last year.
This recovery is attributed to more stable electricity supply from Eskom, and largely driven by the country’s land transport sector, which is up 4.6% on last year.
Based on the World Bank estimates, road freight is by far the biggest industry within the sector, followed by rail, storage and air freight.
While the Ctrack Logistics Barometer indicates freight volumes from the previous three months of 2019 against the same three months from 2018 – some monthly measures are highly volatile and can depend on single factors, it said.
Land transport figures include coal transportation to power stations, although most quoted land transport volumes relate to general consumer and intermediate goods transportation.
In terms of air freight, direction of travel data is not available, only the total volumes.
“Some trade analysts have stated that the trade upheaval will impact air freight products first as they are more likely to be “just-in-time” type goods,” Ctrack said.
Air freight data from Lanseria airport is expected to be included in the data within the next six to eight months, while urban traffic data from ETC and Sanral is also expected to be included soon.
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