Shippers count the cost of port delays

The troubled introduction of the Navis system at Durban harbour has resulted in a number of international customers asking for “gate price” of chemicals to ensure swifter receipt of goods and to prevent production delays, says Sudesh Singh, the sales and marketing manager of Zinchem in Benoni. Singh said the chemical company had been forced to carry orders from one month to the next because of delays at the harbour, resulting in clients from the Middle East and South Africa requesting to carry the cargo they purchase themselves. “Taking the shipping and transporting costs out of our costs gives us very little room to maximise returns on our prices because we traditionally offer services as a package,” he said. Although Singh says Zinchem is not a “big” exporter – on average it exports around 200 tons of chemicals a year – events at the harbour since February have been serious enough to make a significant dent in the company’s bottom line. “As a company going forward in the zinc industry, we are looking at new markets in South America and Europe and here we would be dealing with multinationals who would not accept irregular shipping schedules from us,” he adds. Zinchem invested in a new zinc dust plant on the East Rand last year and has even sold its 2011 export book but is incurring costs, for example for storage, when ships do not run on time. “When dates are set for example by our clients in the Middle East, and they don’t receive the chemicals, then production is halted. If you are in mining, production grinds to a halt until zinc dust gets to the mine,” he says. Singh says South African commerce organisations and the International Zinc Association should put pressure on harbour authorities to fix the problems urgently.