The Ctrack Transport and Freight Index (CTFI) retreated further during August, to an index level of 118.8, the lowest since February, when it was at 116.7. 

This represents a 1.5% decrease. It is also the third consecutive monthly contraction, and serves as confirmation of the ongoing strain the domestic logistics sector is facing, states the CTFI report.

Four of the six subsectors measured by the index declined on both a monthly and a quarterly basis. 

The index tracks the road freight; rail freight; air freight; pipelines; storage and handling; and sea freight sectors.

Overall, the CTFI also dipped into negative territory on a yearly basis for the first time since February 2021, with hope of a notable recovery this year fading.

“While government has started to come to terms with the negative impact the underperformance of the sector has on the broader economy, the implementation of reforms is too slow. Urgency is required in order to reverse this negative trend,” says Ctrack CEO Hein Jordt.

On a yearly basis, only the road freight subsector recorded positive growth, albeit at a muted pace. 

This sector has always been the most resilient of the six sectors, but yearly growth has subsided notably to only 1.7% year-on-year during August, a far cry from the yearly growth of 28.2% experienced in August 2022, and also the lowest since December 2020.

A closer look at August’s figures suggests that a tentative recovery may be underway, with road-freight payload in the country rising by 1.6% and heavy vehicle traffic on the N3 increasing by 5.5% on a monthly basis. 

The road freight industry continues to benefit from the ongoing woes in the rail sector, says the CTFI report.

“This sector remains a critically important contributor to the South African economy as trucks transport 80% of goods in the country. 

“However, the over-dependence on road freight, which has become more pronounced in the past few years, costs the South African economy dearly as road freight transport is more expensive than rail and also raises the cost of road maintenance,” notes the CTFI report.

“The recent surge of the international oil price, in combination with renewed rand exchange rate depreciation, has resulted in notable diesel price increases, which will no doubt push headline consumer inflation back into a range of between 5.5% and 5.9% for the next few months.

“The cumulative increases over the three months from August to October could total just more than R5/litre. 

“The direct and indirect impact of these increases is sure to have a negative impact on the fragile state of the South African economy.”

The CTFI report shows that the sea freight sector is still in a gradual recovery mode as it increased by 3.1% on a monthly basis in August, but remained in negative territory compared with the levels of a year ago (–2% year-on-year). 

Comparing the number of containers handled during August to the level in September 2022, indicates that the total is still 11.1% lower. 

The rail freight sector continued to subside in August, remaining deeply in negative territory on a yearly basis, and declining by a further 7% year-on-year, which represents the seventeenth consecutive monthly decline. 

Air freight has been under pressure for most of the year and declined by a further 1.7% on a monthly basis during August, while the sector remains just below its position of a year ago. 

While air cargo tonne-kilometres to Africa increased by 2.8% and consolidated airport flight movements also increased, the number of unscheduled flights that are typically chartered for cargo purposes, as well as cargo load on planes, both declined during August, notes the CTFI report.

The August transport of liquid fuels via Transnet Pipelines increased by 2.3% compared with July, with the pipeline component of the CTFI tracking moderately higher on a quarterly basis (+3.1%) but remaining deep in negative territory on a yearly basis, with declines of 15.4% recorded.

The storage and handling subsector of the CTFI declined further in August, by 2.4% on a monthly basis, while moving 3.9% below last year’s levels.