South Africa heading for the gutter

Sustained underperformance at the Port of Cape Town has led to R350 million in losses for South African fruit producers.

The sustained weakness of South Africa’s port logistics sector not only erodes exporters’ margins but also strains rural economies.

Industry bodies are warning that this undermines the country’s reputation as a reliable exporter and supplier of high-quality fruit, making South Africa lag behind competitors like Chile.

This is according to a recent report from the Bureau for Economic Research’s Impumelelo Economic Growth Lab, written by Rose Murunzi and Roy Havemann.

The report comes after the Impumelelo Economic Growth Lab introduced a new reform barometer to assess whether structural reforms are translating into measurable improvements in economic performance.

For structural reforms in the logistics sector, Murunzi and Havemann described progress as positive, but uneven.

They noted that South Africa’s rail and port throughput improved in 2025, specifically highlighting progress made at the Durban port.

This is largely due to the 25-year partnership concluded between Transnet and International Container Terminal Services, Inc (ICTSI) earlier this year.

The two parties signed a concession agreement that will see ICTSI operate and develop Durban Container Terminal Pier 2.

This public-private partnership is expected to modernise South Africa and the broader continent’s busiest terminal, increase its capacity, and significantly boost efficiency.

The progress made in implementing reforms at South African ports has garnered recognition from the World Bank and S&P Global Ratings in its latest Container Port Performance Index (CPPI).

The index measures the time container ships spend in port and uses this as a proxy for the performance of the infrastructure that has become increasingly important in a globalised economy. 

In the latest index, South African ports showed some improvement, with Cape Town improving its score by nearly 240 points and Coega by more than 160.

However, despite these improvements, the CCPI revealed that South Africa’s ports remain among the worst in the world, with Durban ranking dead last due to its long wait times, inefficiency in offloading, and lack of modern equipment.

Cape Town winds and woes

Despite its improvement in the latest CCPI rankings, Murunzi and Havemann said the Cape Town port’s recent underperformance has led to a major headache for local fruit exporters.

“Sustained underperformance at the Cape Town Container Terminal (CTCT) has escalated into a material export risk during the 2025/26 deciduous fruit season,” they said.

They referred to a statement from Hortgro, a governing body representing South African pome and stone fruit producers.

In December 2025, Hortgro released a statement warning that anger and frustration had reached a boiling point in the South African stone fruit industry.

This came after multiple logistical blunders and unprecedented wind delays caused “massive financial losses for growers”.

Hortgro reported direct losses exceeding R350 million to date, with further exposure accumulating as vessel delays, quality claims, and diversion costs mount. 

“While the impact of the wind cannot be denied, the industry’s general view is that Transnet’s recovery plan is not bearing fruit and that its effects are not being felt at ground level,” Hortgro said.

Murunzi and Havemann explained that while extreme wind disruptions have compounded delays, industry analysis points to deeper structural weaknesses.

They identified shortcomings in labour management, equipment reliability, operational controls, and accountability failures, reflected in crane productivity falling persistently below global benchmarks.

“Export volumes have declined year-on-year, despite strong production conditions, resulting in substantial rerouting through Eastern Cape ports and Walvis Bay at elevated costs,” they said. 

“The scale and persistence of these failures are eroding exporters’ margins, straining rural economies and undermining South Africa’s reputation as a reliable, time-sensitive agricultural exporter.”

The negative consequences of its Cape Town port could also lead to trouble for Transnet, with Hortgro saying in a statement on 29 January 2026 that it is considering formal legal remedies due to ongoing operational failures at the port.

“Hortgro is firmly of the view that the challenges at CTCT can no longer be addressed by incremental fixes or reactive crisis management,” it said. 

“What is required is a coordinated, transparent, and expert-led transformation programme, supported by measurable commitments, strong executive ownership, strict accountability, and private-sector operational involvement.”

“The escalation of this matter underscores the seriousness of the risk now facing South Africa’s export economy, rural employment, and international market credibility.”

‘Heading for the gutter’

Hortgro explained in its December statement that the underperformance of South Africa’s ports has consequences that stretch beyond the local fruit industry.

“South Africa is suffering reputational damage and rapidly losing market share in foreign markets to competitors such as Chile,” Hortgro said. 

“Its reputation as a reliable, on-time supplier of top-quality fruit is heading for the gutter.”

As one of the most dominant fruit exporters in the global market, fruit plays a critical role in South Africa’s export basket.

According to the National Agricultural Marketing Council, fresh fruits accounted for more than 35% of exports in 2023/24, and South Africa generated almost $3.5 billion in export revenues from this source.

Agriculture Minister John Steenhuisen has also praised the sector in a recent statement, noting that fruits and nuts alone accounted for 26% of total agricultural exports in the fourth quarter of 2025.

This comes at a time when the Department of Agriculture is pushing to increase South Africa’s fruit exports, having recently signed a “landmark” agreement with China.

In October 2025, Steenhuisen signed a stone fruit agreement that opened the Chinese market for the first time to five types of South African stone fruit, namely apricots, peaches, nectarines, plums, and prunes.

This marked the first time China has negotiated access for multiple stone fruit types from a single country under one deal.

At the time the deal was sealed, Steenhuisen described it as a “major breakthrough” for South African fruit producers and exporters, later saying it would transform the local deciduous fruit industry.