As South Africa continues to count the cost of the destruction of the riots of the past few days, the impact on supply chains is starting to be felt.
The slow pace of deliveries to warehouses and retailers – is now threatening business deals and sales volume.
The impact of the riots will also be felt beyond our borders as some countries in the SADC region rely heavily on goods imported through local ports.
The riots engulfed parts of KwaZulu Natal and Gauteng in the past week leading to infrastructure destroyed and stock lost after the burning of trucks, the looting as well as the destruction of cargo, shopping malls and distribution centres.
The riots have also led to the closure of the Port of Durban with movements on some of the national roads affected.
The South African Association of Freight Forwarders says events of the past week will have a negative impact on the economy.
“The short term consequences can be, if we don’t move the supply chains, people can run out of food and fuel in terms of one to three days and that is really very challenging because then it impacts the broader public in South Africa, because we know we are not 1 or 2 million people by 60 million people in South Africa. then if we look at the long term effects, we want to grow the export market and if you grow the export market, you need to have predictability and trust in your supply chain. So the order has been placed long time ago, and the countries outside South Africa are waiting for the merchandise to come, like the citrus season, they are waiting for the oranges to come and if the oranges do not come, they can’t trust us, then we do not have predictability and then they switch to other markets like span or other people” says SAAFF chairperson, Juanita Maree.
Meanwhile, freight rail ports operator, Transnet, says service levels in the ports of Durban and Richards Bay have been negatively affected, as the entire supply chain is closed – including the roads leading in and out of the ports.
Current conditions have made it difficult for the company to fulfill contractual obligations, forcing it to declare a force majeure on the NATCOR line, which links Durban and Gauteng.
Gavin Kelly talking about collapse of the supply of all goods as a result of lootings:
