Maputo port grows into regional economic driver

Industrial logistics operator Grindrod’s strategy to shift focus towards Maputo port amid Durban port woes is paying off, as the Maputo Port Development Company (MPDC) has reported handling a record 31.2-million tonnes of cargo in 2023.

The R8bn JSE-listed group said the 16% year-on-year growth reported by the MPDC, in which Grindrod holds an indirect 24.7% stake, resulted in the port paying more than $41m to the Mozambican government, excluding taxes and dividends to shareholders.

“This financial increase consolidates the port’s economic contribution to the country’s development,” said the MPDC, adding that it consolidated Maputo port’s position as “one of the region’s main economic drivers”.

The port — which handles a variety of cargo including minerals, grains, sugar, vehicles, bulk liquid containers and general cargo — is strategically positioned as a gateway to the Sub-Saharan region and the closest port to the Gauteng industrial hub as well as the Limpopo and Mpumalanga mining regions.

Amid poor service delivery by Transnet, characterised by incessant bottlenecks and backlogs at SA’s key port of Durban, Maputo has increasingly become the preferred port for commodity traders. 

Grindrod in recent years has strategically invested in upgrades to triple capacity at its dry bulk port terminals in Mozambique. It included the upgrading of infrastructure, including six berths, slabs and discharging facilities alongside road infrastructure upgrades and the implementation of 24-hour operations at the borders.

The improvements have allowed the volumes and range of commodities handled to grow at Maputo port as the company has simultaneously channelled an increasing amount of cargo through the port and away from Durban.

The Durban-based company also moved to increasingly use the Eswatini corridor as an alternative to the congested Komatipoort.

The group said on Tuesday it is also making headway in its diversification strategy, with the variety of commodities handled varying in the period.

About 25-million of the total volumes comprised various ores, including chromium, ferrochrome, magnetite, coal, phosphate ore, vanadium, titanium, copper and vermiculite.

Train initiatives

Additionally, it said there was a more balanced distribution of the volumes transported, as 61% was handled by road and 39% by rail. This indicated an 8.4% increase in rail use compared with the previous year, “thus also setting a new record for the Port of Maputo”, it said.

Grindrod has been collaborating with Transnet Freight Rail, Mozambique Ports and Railways (CFM), Zambia Railways, Eswatini Rail and the National Railway of Zimbabwe on initiatives to move cargo on trains.

This is expected to improve train turnaround times and benefit export customers, according to CEO Xolani Mbambo who has been advocating for the revamping of railways in the Southern African Development Community.

“Though there is growth in rail handling, demand for the port has grown exponentially, and we will continue to work with CFM to seek a better balance between rail and road cargo,” said MPDC CEO Osório Lucas.

“Another of the measures adopted by MPDC during 2023 to mitigate road congestion was the opening of the Truck Traffic Management Park in Pessene, which opened in November,” Lucas said.

The record-breaking volumes at Maputo come as SA’s main Durban port, nearly 460km away, has been making strides in its efforts towards a turnaround of the congestion and inefficiencies.

Contrastingly, Cape Town port’s progress has been more muted, according to shipping major Maersk.

According to Transnet Port Terminals, the Durban Container Terminal Pier 2 reduced its vessel backlog at anchor to five in December, indicating that the turnaround plans announced by TPT in November were starting to bear fruit.

Last month, Grindrod reported that its multipurpose terminal in the port of Durban had recorded “an impressive 259,370 tonnes of cargo handled in November”, representing an 85% increase compared with the average volumes handled in previous months of the year.

The multipurpose terminal handles a diverse range of products, including chrome, granite and steel. It attributed the latest thrust to the global demand for lithium, a low-density metal used in rechargeable batteries for mobile phones, laptops, digital cameras and electric vehicles.

The MPDC has been in talks with the Mozambican government to extend the expiry of the Maputo port concession from 2033 to 2058. The government responded by issuing an in-principle approval for the concession extension, which would facilitate increased investment to expand port handling capacity, Grindrod told shareholders in December.

Grindrod shares rose 2.10% to R11.68 on Tuesday.

gumedemi@businesslive.co.za