Richards Bay Coal Terminal unlikely to significantly increase capacity

The inefficiencies by Transnet have emerged as having a bigger impact. Image: Simphiwe Mbokazi / Independent Newspapers.

The inefficiencies by Transnet have emerged as having a bigger impact. Image: Simphiwe Mbokazi / Independent Newspapers.

Published Jan 26, 2024


The Richards Bay Coal Terminal (RBCT) continued to operate viably despite challenges with Transnet’s freight rail performance, CEO Alan Waller said on Thursday, although it was unlikely the terminal will significantly bump up its capacity.

RBCT, which handles coal shipments from Thungela, Optimum Coal Terminal, Umcebo Mining and Glencore, among others, has design capacity of 91 million tons on a 32 trains a day basis, but is managing nearly half this. In 2023, the company said about 48 million tons of coal were railed to the terminal, levels last seen in 1992.

Nonetheless, “the terminal has remained reliable and has remained efficient”, Waller said.

“We have not allowed any noise to impact on how efficiently the terminal is run. Whether it be from a safety point of view, whether it be from an environmental point of view, how we maintain our equipment, that has all remained critical, and we’ve kept to all of those practices,” he added.

Trains offloaded at RBCT sagged to 5 820 in 2023 compared with 6 206 a year earlier, with exports resultantly lowering from 50.3 million tons to 47.2 million tons.

Major export destinations for South African coal shipped through the terminal included Europe (13%), Asia, which accounted for 78.6%, and Africa, which took up 5.6% of the exports. The Middle East accounted for 2.8% at 1.3 million tons.

In all this, the inefficiencies by Transnet have emerged as having a bigger impact. RBCT was now involved in engagements with Transnet and other stakeholders under a mutual co-operation agreement signed in the last quarter of 2023.

“We have already put that agreement into operation. It provides for co-operation between transit and industry, from an investment point of view and it’s strategically around where industry has an ability to possibly do something faster or more efficiently that will add value to the value chain,” said Waller.

He added that the “ultimate objective still remains to get back to the full design capacity” of the line.

In the interim, the low volumes being processed through RBCT as a result of Transnet’s freight rail inefficiencies are worrisome, while network reliability and security issues are also the major headwinds the terminal is facing, he said.

Positively, though, there had been some notable improvements and a hands-on approach after a new executive management was appointed to take charge of Transnet.

“One of the biggest things that the acting executive has given us is that we have actually managed to sign a collaboration agreement, which is a big breakthrough for the industry, because it gives us meaningful participation in assisting Transnet and the RBCT to move more volumes on that (rail) corridor,” said RBCT chairperson Nosipho Damasane.

The quarter to December had notched up some stabilisation, the company said.

Total trains offloaded at RBCT in the December quarter were 5 820 on an average of 16 per day. The bypass rate for the period went slightly up to 11%. The bypass rate is when cargo on a train is transferred straight onto a vessel.

“For four weeks in December, we consistently achieved above a million tons. And we had not seen that for a long time. I think the last week of December, we actually achieved the highest number, in any week since early last year,” Waller added.

For 2024, RBCT is working on a budget rate of 50 million tons, which represents a 2-million ton increase on 2023.

Over the past 10 years, RBCT had witnessed increasing trends in terms of the number of parcels and of companies exporting on a vessel. However, in the past year, there had been “a slight reversal” attributable to the larger-sized vessels, which were increasing in number.