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Diminishing options in South Africa’s logistics sector as freight set to triple

South Africa needs to consider all options to reduce its freight transport costs as demand is set to triple over the next 30 years, research said.

According to Stellenbosch University’s Logistics Barometer, escalating road tariffs, increasing driver fees, rising maintenance costs, and erratic fuel prices, along with the amount of long distance freight compared to Europe, are set to cause problems for the sector.

Based on the current rate of demand growth, freight is likely to triple over the next three decades from the current 781 million tons moved annually. Zane Simpson, from the university’s department of logistics, said the well-being of the sector in South Africa was crucial, but that it was running out of options.

“Imagine three times the number of trucks on our road network and the impact this would have on road infrastructure, traffic and delivery times,” said Simpson. “If we don’t change, a system shock is inevitable.”

He argued consumers were spoiled for choice and a change in their behavior would alleviate the pressure on demand and benefit the industry.

“By demanding less variety, consumers will inevitably reduce the amount of transport needed, saving money, resulting in less road congestion, and ultimately benefiting our environment,” Simpson said. “The logistics industry too must be transparent about these benefits.”

“There has to be a change in the way goods flow between points, whether it be driven by technology or by this reduction in the variety of brands and options on offer to consumers.”

In cases where no alternative exists to long distances transportation, intermodal transport – moving containers using multiple transport modes – could have a dramatic impact, but requires significant investment into rail systems, the research concluded.

Simpson proposed all other conveyance options, even unconventional ones, be considered.

“3D printing items close to source, for example, rather than having to transport from afar would help to reduce transport demand and subsequent costs,” he said. “Seemingly ridiculous ideas even, such as building a canal between KwaZulu-Natal and Gauteng, long distance conveyor belts, or drones, need to become part of mainstream conversations if we are to reduce logistics costs.”

Source: Marino Donati, supplymanagement.com

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