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Post: Overview of global long-distance road transportation of industrial roundwood

Image: Francois Oberholzer, FSA Director of Operations

Operation Stop and Go
2022: A year of urgent meetings to keep transport systems running and address rising crime
By Francois Oberholzer, FSA Director of Operations

A little over twelve months ago I took over the reins of the FSA Operations Portfolio from a forestry giant, Roger Godsmark, and to say life since then has been a blur would not be overly dramatic. So much has happened in a single year, most of it behind the scenes in offices and online meetings where FSA has ardently voiced the concerns, wishes and requirements of its members, and often bolstered by the support of the PPGI.

Transport and crime have dominated my portfolio in 2022, two topics I hardly thought about when venturing into a career in forestry almost two decades ago – when as a Forestry Student I was drawn to the notion of an outdoor office. However, in a modern forestry context these are two critical barriers to Sector growth, economic sustainability and being competitive in an international market.

Transport Networks
Pushing for public-private participation models on the rails and at the ports
Few would argue that South Africa’s transport networks need a dramatic shakeup and top of that list would be our rail and port networks. FSA has been working tirelessly on a public-private participation (PPP) model that would provide exactly that, improving rail and port efficiencies in our Sector. A three-phase PPP approach starting with the procurement of suitable locomotives from the private sector, to be deployed into the existing service and operated by Transnet Freight Rail (TFR) was proposed. With a second phase that sees the transfer of wagons to the private sector, while the service is still operated by TFR. Then a final third phase provides full third-party access where private rail operators use their own locomotives to operate their private service design. The model was presented to the Chief Executive of Transnet, Ms Portia Derby, and her executive team in April, along with two additional rail projects: 1) moving coal from the Highveld to mills in KZN, and 2) the resurrection of the Pietermaritzburg cluster of branch lines. A task team consisting of Transnet, FSA members and consultants was established, and subsequent meetings were held in June and October 2022. Unfortunately, the strategic nature of the Coal Line to Transnet meant the third-party access proposal (phase three) was not accepted, however there was willingness to look at further permutation of the second phase. Similarly, the strategic nature of the coal line saw moving coal from the Highveld to mills in KZN being temporary put aside, with the focus shifted to the Green Arrow line, that moves timber between Zululand and Umkomaas, and the Black Arrow line, which moves coal from the highveld to Ngodwana.  On a brighter note, a non-disclosure agreement has been signed between the parties involved in the Port Pilot Project where the Forestry Industry aim to take over the maintenance, operation and cleaning of the route and berth associated with Woodchip loading in Richards Bay. An industry-based commercial agreement is still however needed to regulate the relationship between the parties, meaning current involvement from the two FSA members to effect repairs and maintenance can only be triggered by a force majeure event. We are, however, moving in the right direction.

Securing small wins during strike stalemate
The October strikes by unionised Transnet employees cost the economy billions and the Sector millions,  however this could have been so much more if it was not for the sustained efforts of FSA and our members. NCT and TWK saw months of hard work and engagement with Transnet Port Terminals bear fruit, as they assisted with the maintenance, operations and cleaning of the route and berth associated with woodchip loading, which could then continue loading at the port of Richards Bay. FSA played an instrumental role in canvassing with the PPGI to set up a cross-sectoral forum which communicated daily with the Ministers of DPE, Labour and Agriculture, the Transnet Executive Team and Transnet Boards members. This link proved to be invaluable for our Sector, as it facilitated the offloading of vessels that contained chemicals used in the pulping process, and delivery of critical coal supplies to mills. The link also allowed us the opportunity to interact with Transnet Board Members and inform them of operational constraints as well as the Pilot Projects we are currently busy with.

Highs and lows on South African roads
The road network in KZN suffered extensive infrastructure dam

age because of the November 2021 and April 2022 floods, with numerous roads and bridges damaged or destroyed. Through supporting Kwanalu in determining the routes worst affected and engaging directly with the Premier of KZN and MEC for Transport, FSA was able to draw focus on key forestry routes, specifically the R603 and R74.

The boom in commodity prices this year and the underperformance by TFR have seen an exponential growth in road transport into the Richards Bay complex. The influx of trucks into the town led to the municipality closing the R619 linking the N2 at Enseleni with the port for heavy vehicles, adding a 38km detour that had a significant impact on the cost of local road haulage. FSA questioned the jurisdiction of the municipality to close a provincial road, taking the matter up with the KZN DOT. Following an onsite visit by the DOT, the road was initially opened for Tractor-Trailer configurations and has subsequently been opened for all traffic.

This year, FSA participated in an international study conducted by the University of Eastern Finland, on the long-distance transport of industrial roundwood in 31 countries. The study looked at maximum gross vehicle combination weights allowed on roads, the domestic timber-trucking logistics of different countries, the share of the road transport of total industrial roundwood long-distance transport volumes, as well as the average payloads, transport distances and costs of industrial roundwood long-distance transport. The findings revealed that South Africa is one of eight countries in the world that achieve a payload over 45 tons, which is extremely beneficial in reducing the cost of road transport. South Africa also had a slightly higher share of volume of roundwood transported long-distance by road, 88% compared to an average of 86.3% and a slightly higher average distance of road transport 125km (vs 119km). Road transport costs were also slightly lower per ton in South Africa R173/ton (R177/ton average).

Tackling Crime
Commercial crimes – on the rise
FSA continues to work tirelessly on the National Priority Committee for Extortion and Violent Crimes to address the increase levels of extortion and violent crimes reported by members. Increased pressure by FSA resulted in an inaugural meeting with SAPS in Mpumalanga in October, where members of the Construction Sector were also in attendance. Through this, FSA was invited to the inaugural meeting of the KZN Provincial Priority Committee for Extortion and Violent Crimes, established by the Construction Sector. These two meetings have provided extremely useful structures of engagement with SAPS. FSA will continue to invest in strengthening these ties, as well as seeking to initiate a similar structure of engagement with SAPS in Limpopo and the Eastern Cape.  

New bill creates big concerns
A big concern for many FSA members has been the proposed Unlawful Entering on Premises Bill, which has led to FSA making a submission to the Department of Justice and Correctional Services to deal with irregularities and conflicts in the proposed Bill. In particular, “request assistance from the authorised member of South Africa Police Service” is problematic in a forestry context since the authorised SAPS member might not always be available or able to intervene timeously when the landowner requires urgent assistance in a potentially dangerous situation. Comments were also made regarding boundaries and the marking of boundaries, that is in most circumstances not feasible in a Forestry context. Interestingly, a desktop study with the ICFR revealed that the Forestry Industry has approximately 28 600 km of boundaries, making signposting and fencing quite challenging.

Investing in the future
Education is a key strategic theme that every FSA portfolio is heavily invested in, we see it as a crucial cog in ensuring the needs of the Sector are met going forwards. To this effect, there have been two important developments during 2022.

Strategic workshop on SETA’s service offering
The FP&M SETA held a strategic workshop in October, where the various industries could give input on how to improve the SETA’s service offering. FSA had sent through a letter to the SETA in August with specific proposals that affect the Forestry Sector, including the timing of Discretionary Grant applications to better accommodate financial year ends of members, the processing time of such applications and the alignment of the implementation windows with the academic cycles of universities and TVET institutions. We requested that the SETA consider a separate process for special projects which are not linked to the pivotal ATR process to evaluate the skills impact of each project on its merit and specifically to recognize projects which are rurally based. We also requested the SETA consider multi-year funding commitments for those projects that span over more than one year.  Finally, we sought a resolution on the challenges associated with using funding templates that have been Gazetted and do not meet the requirements of the POPI Act. In response to the letter sent by FSA, the CEO of the FP&M SETA commented that most of the challenges we raised were regulatory in nature but did offer suggestions on how to overcome the remainder of our challenges.

This year FSA was approached by Business Unity South Africa (BUSA) to participate in a study that looked at the work readiness skills employers seek. This research is assessing six priority and high growth sectors as identified in the Presidential Youth Employment Intervention (PYEI): Agriculture; Automotive; Digital; Global Business Services (GBS); Installation, Repair and Maintenance and the Social Care Economy. Several FSA members participated in the study, with the results being published in 2023. The study, being conducted by Paladin Consulting, seeks to increase employability of young graduates and displaced workers post COVID-19, by addressing the workplace readiness programmes currently in place, workplace adaptations because of COVID-19, reskilling and upskilling requirements, and programmes and tools for displaced workers to re-enter the economy.

Looking forward to 2023
It would be fair to say 2022 was a tough initiation to the role of FSA Director of Operations, but it was also one filled with many important milestones. The PPGI networks FSA has painstakingly developed over the past few years are really paying dividends and as an industry association our voice now carries extra weight. The impact of this is that many long-standing barriers to growth are starting to crumble and again this has been witnessed across all the FSA portfolios. I feel 2023 heralds huge potential, 2022 looks to be a record breaker in terms of volumes and I believe that 2023 will continue this trend. While I am certain it will bring its own challenges, my gut tells me there will be more ups than downs.

Source: FSA

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Overview of global long-distance road transportation of industrial roundwood

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