GRINDROD
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GRINDROD FREIGHT SERVICES
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PRODUCTION: Colin Chinery
Grindrod is synonymous with moving cargo - by road, rail, sea and air. And while its grasp of transportation’s complexities is total and unsurpassed, the Durbanheadquartered group is constantly looking at sector diversification as well as geoexpansion. A dynamic organisation with more than 100 years’ experience in South Africa’s freight movement and related industries, Grindrod is all about serving the SA customer by moving cargo - by road, rail, sea and air - along with inter-related integrated logistical and specialised services. A global business with a footprint in more than 34 countries, the Durbanheadquartered group is uniquely positioned to service Africa trade flows through its four divisions; Freight, Trading, Shipping and Financial Services. “We use our strategically positioned infrastructure and well-established network to facilitate the movement of freight inbound and outbound for our customers,” says Bongiwe Ntuli, CEO of Grindrod Freight Services. www.enterprise-africa.net / 3
INDUSTRY FOCUS: LOGISTICS
// WE ARE VERY WELL ENTRENCHED IN ALL THE LOGISTIC SPHERES, SPREAD ACROSS AND INTEGRATED BETWEEN PORTS, WAREHOUSING AND ROADS //
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For a country where stocks of crude oil can fall disturbingly low, the creation of a new world-class independent petroleum bulk storage hub in the Port Elizabeth area is a notable strategic gain. 60% of South Africa’s domestic fuel requirements is met by imported crude oil, with half refined locally. Against this backdrop, the construction starting in January 2018, of the new storage facilities and marine infrastructure at Port Elizabeth’s adjoining Mandela Bay Port of Ngqura is set to support national petroleum demand projections calling for significant investments in tank storage facilities.
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The new Oiltanking Grindrod Calulo tank farm terminal is expected to begin operations at the end of 2019, reinforcing South Africa’s fuel security as well as delivering increased fuel management. Annual distribution capacity will also increase – up one third to three million tons compared with the beach front tank farm in Port Elizabeth Harbour, whose long-awaited decommissioning and removal is a key in a refurbishment project that will see the establishment of an attractive waterfront. “We have been working on this project for the past seven years, and to have now reached this point is very exciting,” says Bongiwe Ntuli, CEO of Grindrod Freight Services.
COEGA LIQUID BULK FACILITY “It’s the first BOOT project of its kind that Transnet National Ports Authority (TNPA) has undertaken in South Africa, with a private sector operator and it has been an education process for everyone involved.” Oiltanking Grindrod Calulo (OTGC) is the main driver in the project, appointed as preferred bidder by Transnet National Port Authority (TNPA) to plan, part-fund, construct, maintain and operate the facility. For Grindrod, the Ngqura liquid storage facility provides further commodity diversification in fuel storage and handling and aligns its broader portfolio of infrastructure based logistics. The amalgamated Freight Services division, which Ms Ntuli has headed since January 2017, provides services for the integrated movement of dry-bulk, bulk liquid, containerised cargo and vehicles along specific import/export corridors. Ntuli joined Grindrod Freight Services early 2008 as Finance Director.
GRINDROD FREIGHT SERVICES
// WE HAVE BEEN WORKING ON THIS PROJECT FOR THE PAST SEVEN YEARS, AND TO HAVE NOW REACHED THIS POINT IS VERY EXCITING // With a focus on these specific cargo types, the division provides road transportation, rail, port operations, terminals, intermodal solutions, warehousing, storage, stevedoring, sea freight, ships agency services and all facets of traditional logistics. CROSS SPHERES Grindrod’s ability to deliver on the most complex of freight services is underpinned by a vast network of influence, specialised skills, strategic relationships and joint ventures, including successful BEE enterprises. “We are very well entrenched in all the logistic spheres, spread across and integrated between ports, warehousing and roads. And we are complementary to operations that might seem to be our competitors, a partner with all the BlueChip companies as well as shipping lines and mines. “We continually work with Transnet and all the rail resource service providers to ensure that what we are doing is sustainable and measured for the South African economy,” says Ntuli. Initiatives outside South Africa have secured partnerships in Zambia, Zimbabwe, the DRC, and Mozambique where Grindrod is playing a key role in the development of the port of Maputo. Maputo benefits increasingly from its proximity to South Africa’s economic and mineral hubs, its relative proximity to the Gauteng industrial hub and South Africa’s main mining regions giving it a geographical advantage over Richards Bay and Durban, the largest and busiest shipping terminal in sub-Saharan Africa.
The last 14 years have seen $800m spent on increasing the capacity and efficiency of the port, the investment coming from the Maputo Port Development Company. A private Mozambican company, MPDC is a partnership involving the state-owned Portos e Caminhos-de-Ferro de Moçambique, and in which Grindrod has a 24.7% share. The biggest infrastructure milestones were the two channel deepening projects - the first in 2011 and the last in 2016 – which included the dredging of the 76 km long navigational channel that leads to the port.
two million tonnes per annum. Since then export throughput capacity has increased to nine million. Following the dredging of the access channel, works began at TCM. This included, deepening of the berth pocket to accommodate fully-laden Panamax vessels. Until very recently, these ships had to make double stops, one in Maputo and a second in another port in the region, or even diverted to neighbouring ports. At the Port of Maputo, the Grindrod name is stamped on a cluster of major terminal operations, including its Matola Coal Terminal facility which is experiencing spectacular expansion. Grindrod also owns Maputo Car Terminal Limited, a specialised terminal that began operating in 2007 and has since expanded to a 115,000 cars annual throughput capacity.
CAPACITY MULTIPLIED Grindrod Terminals first bought a stake in TCM, a dry-bulk handling terminal customised to handle coal and magnetite in 2005, when its capacity was less than
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INDUSTRY FOCUS: LOGISTICS
Spanning an area of 85,100 m2, facilities include 25 wagon rail sidings, 15 road carrier bays, 28 inspection bays, more than three berths and four automated wash bays. MCTL is ideally situated both as a transhipment hub for the East and West coast of Africa and internationally. Grindrod also operates a grain terminal in the Port providing a fully integrated support and distribution service for grains destined for home consumption and for the transit of grains to South Africa and Zimbabwe. TRANSFORMING INVESTMENT Altogether these massive investments have been directed towards transforming the Port of Maputo from an alternative port into what Maputo Port Development Company’s CEO Osório Lucas calls, “a port of choice.”
For Grindrod, Mozambique “is a critical economy, predominantly in the south around Maputo and Matola. And now our focus over the next months and years is to look at working with partners in the North to achieve the successes similar to Maputo,” says Ntuli, “You have to create capacity a little bit ahead of demand, in-line with your customer plans and then when the demand comes you are ready. If not, you will find yourself even further behind when that demand improves. “We spend a lot of time on market studies, so while current pricing is probably at its lowest level, we expect it to stabilise.” Diversification and geo-expansion includes investment in Zimbabwe’s North-South corridor railway, and work at the historic Ivanhoe Kipushi Bongiwe ntuli
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GRINDROD FREIGHT SERVICES
zinc-copper-silver-germanium mine in the Democratic Republic of Congo, an enterprise that could deliver one of the highest-grade major zinc mines worldwide. Grindrod is exposed to agricultural commodities through the Klerksdorp-headquartered agrilogistics and support businesses Senwes, one of the leading agricultural companies in South Africa, with retail and grain operations throughout central South Africa and grain trading offices in Mozambique, Malawi and Zambia. Another high profile agricultural partner is Lichtenburg-based NWK. With business interests in Botswana, Zambia and the Netherlands, NWK trades in agricultural and agri-related products, resources and services including crop farming and the
storage, trading and financing of grain and related products. BEYOND AFRICA In Mozambique, Grindrod has invested in a graphite mining company, the first time the company has handled graphite, so diluting its exposure to coal. Outside Africa, Grindrod is seeing much activity and interest in its services the Eastern part of the world. “However, we want to protect our name and brand, and do not want to venture into things we don’t understand. So, whatever we do we exercise due caution, offering a fully optimised integrated solution. Selection of locations is critical because we are long term players and invest for the future.” What makes Grindrod successful says Ntuli, is its ability, together with
an agility to look at opportunities and rapidly move first. “We are always on the lookout, and always follow cargo; we won’t get into any project unless we can achieve an acceptable return for our shareholders in the long run. And you have to ensure that your cost base is optimised.” “If there was a crystal ball we would all spend a fortune finding it. And if we knew what tomorrow would be like, right now we would be down at the beach on a houseboat.”
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February 2018
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