After a notable decline in the first two months of the year, the Ctrack Transport and Freight Index (Ctrack TFI) in March increased to an index level of 119.7.

This is an increase of 1.1% compared with February, and just marginally up on a year ago.

Except for two smaller sub-sectors (pipeline transport and storage, as well as warehousing) that declined, the other four sub-sectors in the index increased on a monthly basis, led by a strong increase in air freight.

Similarly, compared with a year earlier, four sub-sectors increased during March, one remained unchanged (pipeline transport) and only the road freight sub-sector declined.

The air freight sub-sector increased by 4.4% in March, following an increase of 1.2% in February, reaching the highest index level since June last year.

All the underlying data for this sector indicated strong growth in March, shows the newest TFI report.

Cargo loads on planes spiked by 50.4% compared with February, while the International Air Transport Association (IATA) also reported strong industry-wide air cargo demand, with double-digit yearly growth in cargo tonne-kilometres (CTK) for the third consecutive month.

The strong demand was championed by carriers from Africa and the Middle East. 

According to IATA’s latest report, growing air cargo demand is a reflection of buoyant international traffic that benefits from booming e-commerce and, possibly, but perhaps to a lesser extent, recent increased interest owing to ongoing capacity constraints in maritime shipping, among other factors.

Overall, air cargo demand appears set to continue the upward trend in CTKs that started early last year.

Furthermore, the number of unscheduled flights (flights that are typically chartered for cargo purposes) and consolidated airport flight movements also increased by 8% and 12.1%, respectively.

Sea freight remains one of the main focus areas of South Africa’s structural reform efforts and some of the shorter-term interventions at ports are starting to bear fruit, notes the TFI report.

After tumbling in October and November, reflecting the inability of ports to handle cargo owing to a number of factors, the sea freight sub-component of the index started to recover in December, continuing its recovery in the early months of this year.

March was the fourth consecutive month in which sea freight recorded positive growth.

Container handling (both landed and shipped) increased by 14% in the first quarter of this year compared with the last quarter of last year, although off a low base, while other cargo, excluding cars, moved mostly sideways.

The road freight sub-sector of the index, which has grown notably in recent years and now accounts for 84.5% of all freight payload in South Africa, recorded muted growth in March, signalling that many challenges remain in the early months of 2024.

Road freight increased by 1.2% on a monthly basis in March, following four consecutive monthly declines.

This sub-sector remains the backbone of logistics in South Africa, however, it comes at a cost to the economy, as transport via road remains notably more expensive than transport by rail, states the TFI report.

“South Africa’s road infrastructure is also buckling under increased heavy vehicle traffic.

“A case in point: trucks were recently forbidden to travel on the R36 Bambi-Mashishing route due to the poor condition of the road.

“Heavy vehicle traffic has since diverted to the N4 route via Machadodorp, resulting in a 47.4% increase in heavy vehicle traffic using that toll route.”

The rail freight sub-sector of the TFI increased 1.2% month-on-month in March, recovering partially from a weak January and February.

Following five years of yearly declines (2018-2022), rail freight payload increased by 2.5% last year, even if off an extremely low base, notes the TFI report.

The storage and handling sub-sector of the Ctrack TFI declined marginally by 0.1% on a monthly basis in March, but remains 22.1% above levels seen a year ago.

Lastly, the transport of liquid fuels via Transnet Pipelines declined by 1.1% in March compared with February, and by 4% on a quarterly basis, while this sub-component of the index remained unchanged on an yearly basis, “partly reflecting the sluggishness of the economy”.

The TFI report notes that the 1.6% quarterly drop in the Ctrack TFI may signal a potential negative contribution from the transport sector to overall economic growth in the first quarter of this year.