As reforms advance into implementation phases we must understand what is important and where to focus
As reforms advance into implementation phases we must understand what is important and where to focusShare current article via TwitterModern container logistics work best when transitions from factory to road to rail to port happen seamlessly, the writer says.
Picture:Recent events such as the Mining Indaba and the National Transport Conference have sparked rich discussion on structural reforms in network industries. In the public domain this has focused on electricity. But behind the scenes an important debate among stakeholders is shaping the logistics reform programme for 2026. Logistics is big, messy and complex.
Different rail, road and port corridors have their own engineering challenges and required solutions. The Freight Logistics Roadmap, adopted by cabinet in December 2023, provides a foundational vision for how this fits together. It aims to introduce competition-driven efficiency and crowd in private sector capital while the government retains ownership of port and rail infrastructure. It outlines the necessary reforms: private sector participation, corporatisation and unbundling of state logistics assets from Transnet and a new transport economic regulator.
Yet we have limited fiscal resources, limited state capacity and limited time. Within the structured vision of the roadmap lies a deeper question that often goes unanswered: how do we sequence effort? Since April 2023, when the National Logistics Crisis Committee was established, these limited resources have focused on stabilising bulk export rail operations ― coal, iron ore, manganese and chrome ― where flows are inherently rail-dependent.
With export rail corridors now showing signs of sustainable improvement, we must ask ― is moving one tonne of freight more valuable to the economy than another? It turns out that not all freight is created equal. Jan Havenga, a professor at Stellenbosch University, has spent years highlighting differences in the revenue a tonne generates and the jobs it supports, and this accords with our own research at Business for South Africa. Bulk minerals dominate volumes and policy discussions.
They generated about R30bn in rail and port logistics revenue for 120Mt moved in 2024/25. At about R250 per tonne, these are capital-intensive operations that support the balance of payments but create relatively few jobs ― around 1.9 per additional 1-million tonnes moved. The container corridor tells a different story. Automotive freight generates about R414 per tonne in logistics revenue and supports an industry employing 191 workers per 1-million tonnes moved.
In a system facing hard fiscal and capacity constraints, that distinction matters. Nor is this limited to containers. General freight includes fruit and citrus exports, fast-moving consumer goods, bulk liquids and manufactured intermediates moving along multiple corridors. Much of this traffic is inherently rail-friendly over long distances but has migrated to road as reliability deteriorated.
The consequence is higher logistics costs, greater pressure on national roads and reduced competitiveness for export-oriented producers. In the long term we need not choose between bulk and general freight. A well-functioning logistics system with third-party access and private investment will eventually accommodate both. But in the short term, with bulk corridors now stabilised, reform efforts must focus on sectors that drive reindustrialisation and create the most jobs.
The container corridor problem is a collective action problem. There are far more customers to organise in general freight than on the ore and coal corridors. Bulk commodity logistics are comparatively inelastic and rail-dependent, while containers are naturally multimodal. Modern container logistics work best when transitions from factory to road to rail to port happen seamlessly ― requiring reliability in timetabling and turnaround times.
The Transnet crisis was not only a collapse in volumes; it was a crisis of reliability. South Africa moves more than 80% of its general freight by road. Havenga’s research shows this is economically inefficient for long-haul journeys. We cannot fix this by looking at rail in isolation; we must view the entire system as a multimodal network.
Our rail system was designed primarily around bulk export and point-to-port movements. It has not developed the network structures that support modern supply chains ― scheduled intermodal services and inland consolidation points that integrate rail with road distribution. Modernising the network requires more than restoring track capacity. It requires developing rail-connected logistics platforms that allow general freight to access rail efficiently and reliably.
One step towards improved reliability is bringing modal switching into “freight villages” ― large-scale inland hubs where logistics providers shift freight between road and rail. Located near economic hubs or special economic zones, freight villages in mature logistics systems are more than transfer points. They are rail-connected precincts where warehousing, consolidation, value-added services and intermodal facilities are co-located.
By concentrating these activities in a single managed environment, they aggregate dispersed freight, enable commercially viable block trains and create the structured handshake between road and rail that modern supply chains depend on. The president’s state of the nation address struck an optimistic chord about our logistics system’s upward trajectory ― thanks to Operation Vulindlela, the department of transport, Transnet, the South African National Roads Agency and the private sector.
Part of this recovery must include a careful eye on economic impact. Countries that have restored rail’s competitiveness have done so by reconfiguring networks around rail-connected logistics hubs, linking them to production clusters and ensuring intermodal transfers are scheduled, reliable and commercially viable. If we focus only on moving the most volume, we risk ignoring the sectors that move the most value. If we fix the handshake between road and rail, the jobs will follow. Sign up or sign in now.
Rail And Road Integration Freight Villages Transport Economic Impact Logistics Mining Indaba National Transport Conference Freight Logistics Roadmap National Logistics Crisis Committee Jan Havenga Business For South Africa Operation Vulindlela South African National Roads Agency Transnet
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