More pain for Transnet

Transnet could face a class action lawsuit from South African fruit exporters as they stand to lose billions due to the utility’s inefficiencies.

This is according to Anton Rabe, executive director at Hortgro, the South African Deciduous Fruit Industry governing body. His comments come as South African fruit producers saw a bumper harvest.

He told eNCA that it would be difficult to quantify the industry’s losses if Trasnet’s inefficiencies continue. “It’s difficult to quantify the loss at this stage. We’re just entering our peak season,” he explained.

“But we are looking at the vessel-by-vessel quantification, which we will be able to do in the next two to three weeks.” 

However, Rabe said that based on the past few seasons, he estimates the loss to be around R2.5 billion. 

“So, you can just imagine what the impact of that is on the income of our growers because it all comes off the proverbial bottom line,” he said.

While Rabe noted some recent improvements and positive management changes at Trasnet, “I’m afraid it’s a little bit too little too late”.

The organisation is now turning to legal recourse on a vessel-by-vessel basis. 

“But even on a broader industry level, we are looking at possible class action,” he said. 

“It’s more complex; it will be more time – sort of a timely or long-term type of intervention – but we have no choice but to look at some remedies which the legal route can bring us,” he said.

Auditing firm PwC recently warned that South Africa’s freight rail and port deficiencies are set to continue, and businesses should brace for further supply-chain challenges this year.

“Aside from the impact of international conflict on local companies, South Africa is also facing domestic challenges set to cause continued disruption in supply chains in 2024, specifically those involving rail and port logistics,” the firm said.

Other companies in South Africa – in particular, miners – have already turned to alternatives to state-owned Transnet.

For example, Exxaro Resources has been moving away from using some of the South African ports and using neighbouring countries’ ports to move their resources out of the country.

Exxaro CEO Nombasa Tsengwa recently told Newzroom Afrika that the company is “bullish” on Mozambique’s Maputo port.

“We will be reporting some movement through Maputo – that’s where we’ve gotten most success,” she said.