Post: Driving A Rail Revival: How The Forestry Sector Broke New Ground With Transnet And The Competition Commission

January 26, 2026

Driving A Rail Revival: How The Forestry Sector Broke New Ground With Transnet And The Competition Commission

Few sectors rely on rail as profoundly and as historically as Forestry. For more than 30 years, timber moved dependably on the Coal Line, the Pietermaritzburg branch lines, and the NorthSouth Coast Line. But by 2025, the entire system had reached breaking point. Of the roughly 3 000 specialised timber wagons once in service, fewer than 450 remained operational. Sidings were falling into disuse, maintenance had stalled and the Industry faced spiralling road-freight costs and severe congestion at mill sites.

Amid this decline, FSA made a strategic decision: to take the lead in restoring timber to rail. Not through shortterm firefighting, but through a structural, long-term rebuild of the entire system. What followed over the next several months would become one of the most ambitious rail-reform partnerships in the Forestry Sector’s history.

A First for Forestry

A turning point came on 26 June 2025, when the Competition Commission granted FSA a Block Exemption allowing the entire Forestry Industry to collaborate legally on non-competitive logistics matters, including rail and ports. This exemption is exceptionally rare. During one of the legal workstream meetings, a leading competitionlaw expert remarked that he was “rather impressed that FSA managed to secure this exemption”, noting that in his extensive career, he had “not seen any other party be successful in obtaining an in-scope confirmation letter like this”. For the Forestry Sector, this wasn’t just a regulatory win: it was recognition of the seriousness of the crisis and the strategic value of restoring timber to rail. This has prompted other associations, e.g. Agbiz, to contact FSA for guidance on how they could follow the same route, another sign of how groundbreaking this achievement has been.

From Exemption to Action: Building the FSA–TFR Task Team

Following the exemption, FSA established a joint TFRFSA Task Team and Steering Committee to coordinate strategy and implementation. Working jointly, the Task Team produced the Forestry Rail Task Team Project Plan, a detailed roadmap covering:
• Wagon rehabilitation and funding
• Industry demand consolidation
• Service design and operational readiness
• Maintenance cycles and repair scheduling
• Commercial frameworks, rate structures, SLAs and risk allocation
• Phase 1 (Wood Owl) and Phase 2 (PMB Cluster) implementation frameworks.

The plan recognises a stark truth: unless the wagon fleet is rescued, nothing else can move. It therefore prioritises a bankable wagon funding model as the foundation for every other intervention.

While early engagements were constructive, progress slowed due to delays in TFR’s responsiveness and the removal of key clauses from the draft Terms of Reference relating to pricing transparency and cost collaboration. To resolve these issues, FSA’s Executive Director wrote to TFR’s Chief Executive, highlighting the urgency of action given the declining wagon fleet and the Industry’s extensive efforts to support rail recovery. The intervention proved successful, with the CE responding immediately. A subsequent high-level meeting with his management team was held to reset the process and reaffirmed TFR’s commitment to collaborating with the Forestry Sector under the new framework. At a followup meeting, FSA stressed that the costing model and wagon availability are the two critical cornerstones of the initiative that must be addressed as a matter of urgency.

A SteerCo meeting with TFR took place on 14 November, focusing on practical steps to unlock short-term rail capacity ahead of the December shutdown. TFR confirmed that at least 100 timber wagons will be repaired and returned to service by 19 December 2025, with the possibility of adding more as work progresses. This intervention is aimed at stabilising volumes immediately while broader structural issues continue to be addressed. TFR also reported improving operational performance on key corridors. In parallel, TFR proposed that the current work on customer-led funding models and the broader tariff redesign be temporarily paused until early 2026. Their view is that the process has become overly complex and is delaying real throughput gains. Instead, they propose maintaining the existing commercial and tariff framework for the remainder of their financial year while focusing on restoring wagon availability and keeping trains moving. The Industry supported this as a sensible interim measure that maintains momentum, keeps cash flowing through the system, and avoids further capacity stagnation.

The SteerCo agreed to resume the more detailed governance, funding and tariff-structure workstreams in late January once the immediate operational priorities have been executed.

National Influence Beyond Forestry

FSA’s work has now extended far beyond its own Sector. The Department of Trade, Industry and Competition (DTIC) invited FSA to contribute to the national Rail Cost Reduction Programme (2025–2029), where FSA stressed that meaningful cost reduction requires government support, and that National Treasury and the Department of Transport must be engaged directly. The NLCC and B4SA have also woven forestry’s rail recovery into broader national logistics reforms. The fact that forestry is being recognised at this level, alongside automotive, citrus and grain, highlights how strategically important timber is to South Africa’s logistics system.

A Sector That Chose to Lead,Not Wait

The Forestry Industry could have resigned itself to declining rail services, rising road costs, and the gradual erosion of rural competitiveness. Instead, it chose to lead – collectively, legally and strategically. It secured an unprecedented Block Exemption, bringing the Sector together behind a shared strategy. It also built a joint task team with TFR, escalating matters where necessary, and reset the process decisively. The coming year will focus on implementation: wagon funding, costing transparency, service design and performance monitoring. But the groundwork has been laid, and the national recognition for this work speaks for itself.

Written By: Francois Oberholzer, Operations Director – FSA

Source: Forestry in Focus