Cold Link Africa November / December 2019 | Page 5

NEWS
INCORPORATING COLD CHAIN
A
Ctrack Logistics Barometer
indicates road freight resilience
ugust data from the Ctrack Logistics
Barometer indicates pronounced
deceleration in global logistics
growth (see figure 1), particularly in sea and
air freight volumes (see figure 2).
While the growth slowdown was
already evident in July’s Ctrack Logistics
Barometer, the pace of the slowdown is
now more apparent, as can be seen in the
barometer’s short-term data.
Despite this, total freight volumes in South
Africa are up 1.1% on a year ago on a three-
month (June, July, August) moving average
basis. Road freight volumes showed the
strongest positive trend rising 3.1%, while sea
freight volumes showed the biggest decline
of -3.5%.
The global trade war is starting to have
an impact on South African trade and the
volume of shipped containers is a clear
indication of a slowing world economy.
Break bulk volumes at South African ports
have declined 35.3% from a year ago on
a three-month (June, July, August) moving
average basis – the biggest year-on-year
decline recorded since 2008. South African
container volumes declined 6.2% during the
same period.
Land transport though is still growing due
to internal demand, while bulk coal and iron
ore exports show positive growth. However,
even here the short-term trend is slower than
before, with the Ctrack Logistics Barometer
suggesting far more mundane economic
performance in the 3rd quarter of 2019.
The pipeline sector, which is dominated
by fuel transportation, indicates a small
decline of -0.4% on a year ago but a
much larger -5.1% decline compared to
July. The price of fuel has not increased
much but users have either delayed
buying more in the hope of lower prices,
or due to uncertainty in the short-term
economic outlook.
With a sudden rise in the oil price,
higher fuel prices are likely in October. If
fuel volumes still decline in September,
the reason will likely be attributed to the
uncertain economic outlook.
The measurements below (Table 1) show
freight volume changes – in percentages
– over different time periods. The most
important of these is the three-month
moving average (June, July, August)
measured against the same three months of
last year.
The drop in sea freight volumes is
confirmed by the CPB World Trade Monitor.
Overall, global trade is estimated to have
declined by -0,4% for the three-months to
June 2019 compared to the same period a
year ago.
Although this data is a little earlier than
the August Ctrack Logistics Barometer data,
one can surmise that declining world trade
will weigh on the barometer since logistics
by its very nature is a cross-border industry
heavily influenced by global trends.
Strangely, in contrast to slowing world
trade trends, the latest IATA data shows
a substantial increase in international air
freight for South Africa.
Nonetheless, the global trade war is
impacting world trade and that will likely
have a negative impact on both sea and
air freight for the next few months or even
quarters. Slower growth will also influence
the movement of minerals – the main
income generator for Transnet Freight Rail.
Furthermore, the drought in the wheat
growing regions of the southern Cape will
impact road freight. More wheat may have
to be imported, making for longer journeys
for transporters. This may already be a
reason for the growth seen in road freight.
“We are proud to say the Ctrack Logistics
Barometer, now in its second month, has
been well-received in the marketplace,”
says Hein Jordt, managing director of
Ctrack SA.
“It appears that road transport
continues to gain market share, providing
the backbone in the South African
logistics industry. However, it remains
imperative for transport and logistics
companies to manage their delivery fleets
closely in lieu of recent oil price increases.
Only a holistic fleet management system
with daily insights – such as Ctrack’s
business intelligence reports and bureau
services – can simplify this important task
for fleets.” CLA
Figure 2: Fourth quarter 2018. (Source: economists.co.za and Ctrack.)
TABLE 1: FREIGHT VOLUME CHANGES.
Road Pipeline Sea Air Storage &
handling Logistics
August 2019 vs August 2018 +0.1% +2.2% -5.9% -1.5% -2.0% -6.1% -0.1%
March, April, May 2019 vs
March, April, May 2018 +1.0% +3.1% -0.4% -3.5% -0.4% -2.1% +1.1%
Change from July 2019 to
August 2019 +1.1% +0.8% -5.1% -4.1% +0.9% -6.3% -0.7%
March, April, May 2019 vs
June, July, August 2019 -1.0% -0.5% -1.4% -8.5% -0.8% +0.9% -1.1%
Change from 2018
Rail
Short term changes
Figure 1: Deceleration in global logistics growth. (Source: economists.co.za
and Ctrack).
COLD LINK AFRICA •
November/December 2019
Source: economists.co.za and Ctrack.
www.coldlinkafrica.co.za
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