Transnet strike hits hard
March 13, 2006
Johannesburg - Cranes at Durban port, Africa's busiest container terminal, have been idled and rail commuters in Johannesburg and Cape Town stranded by a national transport strike, union leaders said.
The walkout today follows regional strikes since January 30 over a plan by Transnet to sell assets. The unions also demand guaranteed jobs and pensions for 85 000 workers, said Randall Howard, secretary general of the South African Transport & Allied Workers Union in Pretoria.
"If we don't see a resolution, we will consider a second round of strikes," he said in an interview from Durban on Monday.
"They will be much longer than in the first round."
A prolonged strike could cut coal supplies to European power stations, delay iron ore shipments to China and stop local chicken producers from bringing in low-cost Argentine corn. South Africa is the world's third-biggest exporter of coal used in power stations, and 80 percent of the shipments go to Europe.
"What you will be getting is a bad name with your customers if you can't deliver at a time when they really need the goods," said Con Fauconnier, chief executive officer of Kumba Resources, Africa's biggest iron ore producer, in a March 9 interview from Pretoria.
"It's an anxious time for us."
Monday's strike cut cargo handling at Durban and other ports and has been "90 percent to 100 percent effective" on commuter rail networks, Howard said.
Cars on one of the main roads into Cape Town, the N2, were at 9.30am backed up beyond the city's airport more than 10 kilometres from the centre as people from the low income areas of the Cape Flats switched to road transport from trains.
Metrorail services were only carrying about a third of their normal daily total of 1.8 million passengers, spokeswoman Thandi Mlangeni said in an interview from Johannesburg.
All South African ports are running "normally" with the exception of Durban, John Dludlu, Transnet's spokesman said by telephone from Johannesburg today. Durban is operating below 50 percent of its capacity, said Grindrod, South Africa's biggest shipping company.
"Areas of the port are continuing to function, but those functioning are working at half capacity or less," Allister Donald, general manager of Grindrod's ship agency division, said in a phone interview today.
The first regional strike in the province of KwaZulu-Natal from January 30 to February 1 cut handling at Durban by as much as 75 percent, according to Dave Rennie, chairman of the Container Line Operations Forum, which represents shipping companies.
Apart from commuter services, some freight trains, including those running to Richards Bay Coal Terminal on the east coast, are idle, said Molatwane Likhete, a spokesman for Transnet's rail company, Spoornet.
Di Harvey, a spokeswoman for Richards Bay Coal, said there has been no impact yet. The terminal is the world's second-biggest coal export port after Newcastle in Australia. Anglo American, BHP Billiton and Xstrata own most of the terminal and are the biggest exporters of coal from the country.
The first strike contributed to a drop in deliveries of coal by rail to Richards Bay Coal Terminal to 4.74 million metric tons last month, the lowest level in more than two years.
The unions pulled out of settlement talks on March 4 after Transnet signed an agreement to transfer its passenger rail unit Metrorail to the South African Rail Commuter by the end of the month, without resolving how workers will be affected.
Workers want written assurance that no one will be fired for five years and pension benefits won't be cut, Howard said by telephone from Pretoria on March 10. The unions will meet with Alec Erwin, South Africa's minister of public enterprises, at 3.00pm.
"In light of his failure to read the riot act to Transnet's management, we are not hopeful," Howard said.
South Africa's government says improving the transport network is a priority as it seeks to boost economic growth to 6 percent by 2010, from 4.9 percent last year, and reduce a jobless rate of 26.7 percent.
Transnet's Chief Executive Officer Maria Ramos wants to sell assets including South African Airways and bus company Autopax to focus on ports, rail freight and oil-product pipelines. Transnet on March 5 appointed Standard Bank Group, Deutsche Bank and Investec Bank to advise on the plans. - Bloomberg
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