NUMSA strike to go ahead, At a CCMA facilitated Dispute between NUMSA and other unions earlier this week, NUMSA exercised its right to call for the issuing of a certificate of non-resolution.
With NUMSA having declared it’s dispute against all the employer organisations on the 29 July, and SEIFSA and the Associations having countered with its dispute against NUMSA on 2 August, NUMSA is within its right to call for the certificate.
We will monitor the situation and circulate any information received but the feeling is that we must prepare for the worst-case scenario.
Some striking has been noted at various steel merchants around Johannesburg which in turn will lead to some disruptions in steel supply.
Border updates, Beitbridge is once again the centre of attention as delays continue, this time with various contributing factors. SARS’s systems have gone down.
Trade flows through the routinely congested transit have been a nightmare of late, with processing delays on the Zimbabwean side of the crossing slowing traffic to a trickle.
Now, with SARS also experiencing issues, the queue south of the border is expected to worsen and transporters are advised to make the necessary preparations for a long wait.
The question also remains as to why trucks working the north-south line through the Southern African Development Community should be checked and charged by Zimbabwean authorities as often as they are at the two primary transits on this route – Beitbridge down south and Chirundu in the north.
At the Limpopo River crossing, alleged over-inspection is resulting in a queue stretching for kilometres south of the border, although processing is affected because of physical constraints caused by construction work, it still doesn’t explain why the Vehicle Inspection Department is inspecting cargo already weighed immediately south of the border.
Transport carrying SA’s GDP, South Africa’s transport sector grew 6.9% in the year’s second quarter, becoming the biggest sector to add to the 1.2% economic expansion announced earlier this month by Statistics South Africa.
The mining sector, sustained by a growing demand for raw minerals by global manufacturers, grew 4%.
The South African economy recorded its fourth consecutive quarter of growth, expanding by 1.2% in the second quarter of 2021.
The economic impact of the wave of severe economic disruption, protest action and violence in KwaZulu-Natal and Gauteng, which took place in July, will only reflect in the third quarter GDP results, due for release in December.
Solar Power to reduce reliance on Eskom, The generation of solar power by top-performing gold mining company Pan African Resources is expected to lower reliance on power utility Eskom by up to 30%.
Pan African’s focus is to function off the national electricity grid during daytime hours at the moment as power storage options appeared to be very expensive at the moment.
The group’s focus now is solar and making sure it works. Ten megawatts will be the first plant and by early next year it would have proven itself.
Pan African produced 12.4% more gold over the last 12 months and reported a 36% increase in operating profit to $128 million.
Container rates continue to soar, container rates have more than quadrupled since the beginning of this year as shippers across the globe drive prices to levels well beyond the previous peak recorded 16 years ago.
The peak from 2005 is a whopping 128% lower than the level to which the current rates have increased.
To make matters worse for freight forwarders battling to keep up, the 128% increase is expected to curve upwards into 2022.
There is some hope as some freight liners such as CMA CGM have announced that freight rates will be paused till early next year as well as German shipping major Hapag-Lloyd confirmed that it had put a hold on freight rate increases on certain routes and would continue to do so for the time being.
Port congestion and severe capacity shortfalls have put shipping lines in the driver’s seat as rates skyrocketed. However, with lines under increasing pressure from shippers and regulators, perhaps this is the start of a cooling of rate rises.
Copper and Iron Ore prices drop, Iron ore price fell on Thursday after China reported a drop in the country’s steel production in August. The price of the commodity dropped by 7%.
China’s production was in excess of 83 million tonnes of crude steel in August, a 13% drop from the same period a year ago which is the lowest recorded level since March 2020. China’s efforts to cut emissions is the leading cause in the drop.
The price of copper is another commodity that felt a price drop as China has decided to release copper, aluminium and zinc from its state reserves, in an effort to overcome the gap between supply and demand.
China, being the world’s number one metal’s consumer had released 420,000 tonnes of the metals so far this year through batches where the public could bid on prices that sat slightly lower than the market value.
Copper was trading around $9,438 per tonne on Thursday.
The market now awaits the expected tapering of stimulus in next week’s US Federal Reserve meeting.
Zambian government to restore sanity, Zambia’s newly appointed mines minister, Paul Kabuswe, said on Tuesday that government will ensure that there is stability and predictability in the mining sector as well as calming any fears of mining royalties being increased.
Zambia, being Africa’s second-largest copper producer, which defaulted on its sovereign debt last year, has benefited from an increase in copper prices to record highs.
Zambia’s policy on Mopani Copper Mines KCM, two critical operations will be overseen by new President Mr. Hichilema. Zambia took on $1.5 billion in debt to buy Mopani from Glencore in January this year and they are still seeking a new investor for it. The previous administration was looking for an investor to fund the mine’s expansion, which they are hoping would boost output from 34,000 tonnes of copper a year to 150,000 tonnes.
President Hichilema’s market-friendly stance will hopefully attract new investment into Zambia’s mining sector which in turn will help boost the country’s copper production at a favourable time whilst copper nears record-highs.
Zimbabwe seeking investors, Zimbabwe will seek to raise $200 million in a debut domestic U.S. dollar bond sale on its stock exchange in Victoria Falls that trades exclusively in foreign currency, according to Finance Minister Mthuli Ncube.
Earlier this month, Bloomberg reported that the bond sale would be for $100 million. In August, Ncube said a debt offering could help meet the cost of a $3.5 billion compensation bill the country is facing after it reached an agreement with White farmers evicted from their land two decades ago.
The so-called “Zimbabwe Global Investor Roadshow” has seen Ncube travel to South Africa and Dubai to court foreign investment. In New York, Ncube will also meet with officials from the International Monetary Fund and the World Bank, ahead of an IMF visit to Zimbabwe that’s expected next month.
Zim looking for additional power to ease 12-hour cuts, Zimbabwe is looking to Mozambique and Zambia to supply it with more electricity as it tries to fill a power shortfall that’s led to 12 hour power cuts.
Government is currently in discussion with Mozambique trying to secure an additional 180 megawatts from their newly commissioned power plants as well as attaining an extra 100 megawatts from Zambia.
The current electricity cuts are due to rehabilitation work at the Kariba South hydropower plant, constraints at its coal-fired Hwange plant as well as limited power imports, according to the Zimbabwe Electricity Supply Authority.
On a lighter note; a Zimbabwean artist has brought new life to obsolete Mugabe-era banknotes and turned them into striking paintings. A 100 trillion Zimbabwe dollar has finally found value thanks to the artistic talent of Prudence Chimutuwah. Prudence explained that she wants people to heal from the damage caused during the days of hyper-inflation and see the bank notes in a new joyful light! Her figures are mainly painted in blue, which she described as “a symbol of strength and dominance”.
Happy weekend ahead!
Upcoming Public Holidays:
24th September 2021 – Heritage Day (RSA)
“Life is like riding a bicycle. To keep your balance, you must keep moving.”
Zambia elects a new president, President Elect Mr Hichilema defeated main rival President Edgar Lungu, by almost a million votes.
This was President Elect Mr Hichilema’s sixth attempt at winning the presidency and his official inauguration is on Tuesday 24th August at National Heroes Stadium.
H.H. has already refused the expensive Lexus presidential vehicle and continues to drive around in his Nissan Infinite living his message to the people of Zambia, that all Zambians matter and the presidency is not about self-glorification; it is to serve and make Zambians proud again! Already he has met with the Director Generals of the Financial Intelligence Centre, Anti-Corruption Commission and Drug Enforcement Commission to ensure Zambia moves in the right direction free of political interference, corruption and with proper accountability.
Our congratulations go out to all people of Zambia for demonstrating the power of true democracy and we look forward to witnessing a very positive term in office for HH that will bring upliftment, prosperity and pride to all Zambians.
Zambian Copper producers standing by to start expansion projects worth $2 billion once industry has reached an agreement with HH on royalties which has been on hold since 2019 when tax changes were implemented. Specifically mining royalty taxes were increased to 5.5-10% from 4-6% and was not deductible from Corporate Income Tax.
NUMSA picketing “premature” The National Union of Metalworkers of South Africa has served notice that it intends to start picketing following failed wage negotiations with the Steel and Engineering Industries Federation of Southern Africa (SEIFSA).
The federation says it views this notice as “premature” in that picketing may only be embarked on in support of a protected strike or in opposition to a lock-out.
To date, SEIFSA reports, neither party or parties have served strike and/or lock-out action on the other and negotiations aimed at breaking the deadlock are ongoing.
The federation advisedthat it is has various meetings with all the trade unions this week and next week, under the supervision of the Bargaining Council.
SEIFSA first made a wage offer at the Bargaining Council late last month, during which other unions indicated a willingness to accept the offer. The federation suggested that workers receive a 4.4% increase this year, a consumer price inflation plus 0.5% increase in 2022 and a 1% increase in 2023.
SEIFSA says centralised collective bargaining is more necessary than ever before to ensure the survival and recovery of the industry.
NUMSA believes the special phase-in dispensation, which introduces a new entry rate ranging between R20 and R29 an hour, will allow employers who have not been paying the minimum rate of R49 an hour to continue doing so for 15 years.
We wait to see the outcome of these talks and can only hope that all parties come to an agreement as the industry and the country itself cannot afford such a catastrophic event.
Border updates, The Democratic Republic of Congo has doubled back on proposed legislation designed to prevent foreign-registered transporters from carrying DRC minerals out of the country.
A declaration signed on July 29 by the minister of transport and ways of communication announced plans to restrict the carriage of export minerals solely to vehicles registered in the DRC which was due to come into force on the day.
However, in an about-turn, DRC President Félix Tshisekedi has asked the minister to revisit the legislation in light of its anti-competitive nature.
While investigations are under way, the legislation is not going ahead and will most likely be overturned, currently foreign transporters can still pick up loads.
These include the provisions of the COMESA treaty, which calls for the promotion of competition, the elimination of measures that stand in the way of the free movement of people and goods and the reduction of non-physical barriers, particularly legal and regulatory ones.
Transnet recovery on track, Transnet Port Terminals’ recovery plan is making good progress after the cyberattack last month that paralysed its Navis cargo processing system, bringing the utility’s ports and railways network to a complete standstill.
Customer interfaces had largely returned to normal.
Looking into the recovery status from port to port, the Durban Container Terminals, Pier 1 and Pier 2, where the import volume pressure was most evident, had done well despite much time being lost due to weather delays this past week.
The terminals are still being impacted by delays in evacuation of imports. The terminals are feeling this congestion on the landside which is now creating delays on the waterside. Currently, as at August 16, Pier 1 had two vessels at anchorage awaiting a berth. Pier 2 had six vessels, with an average berthing delay of four days.
Cape Town port appears that recovery has been decidedly better. Transnet Port Terminal said that Cape Town Container Terminal had minimal delays, and a balanced yard.
The ports of Ngqura and Port Gqeberha are also recovering well.
Copper Price Bounces Back, the price of copper bounced back last week as worries about supplies from top producer Chile gathered pace.
BHP and the workers union at its Escondida copper mine said last week that they would extend government-mediated contract talks by a day in a last-ditch effort to stave off a strike. The world’s biggest copper mine accounts for about 4.5% of global copper supplies estimated at roughly 24 million tonnes this year.
Copper for delivery in September rose 1.9% from last weeks’ settlement price, touching $9,618 per tonne.
Meanwhile, concerns about Chinese demand and a firmer dollar tempered optimism for higher prices.
China’s January-to-July copper import volumes dropped by more than a tenth compared with the first seven months of 2020.
The biggest copper buyer in the world bought 3.219 million tonnes of copper from January to July, down 10.6% compared with the same period in 2020.
US legislation to regulate carriers shot down, The World Shipping Council has come out strongly against proposed US legislation designed to tighten regulation of carriers in order to address supply chain congestion resulting from record US consumer and business import demand, coupled with disruptions resulting from the Covid-19 pandemic.
A framework has been shared which the WSC believes is flawed, particularly the suggestion that ocean carriers are solely responsible for the current supply chain congestion.
The congestion is widespread, with every link in the supply chain being affected, from marine terminals to truckers, rail cars and warehouses are all under tremendous strain.
The WSC points out that what is “crystal clear” is that regulating only ocean carriers, or any other single class of supply chain provider is doomed to fail.
The bill would require ocean carriers, under the threat of penalty, to guarantee the performance of other parties over whom they have no control, for instance by putting the burden on ocean carriers to ensure chassis, trucks and rail cars are available from third party providers.
The WSC has accused the government of tilting the market in favour of shippers in commercial disputes.
The organisation further warns that the legislation, if enacted, would incentivise trade partners to enact similar protective legislative and regulatory frameworks in their countries.
Steel prices in USA have risen 215% since March 2020 which in turn has destroyed many American jobs and negatively impacting many industries. The increase to the import duty to 25% in 2018 implemented by Trump has been kept in place by the current Biden government and continues to cause no end of grief to industry at large.
USA Air Cargo screening continues to be a challenge for some packaging and products that is deemed unairworthy unless it can pass through security screening. The thought is that further down the line manufacturers can be accredited in some way and certify in other ways yet to be identified.
China’s port shutdown sparks worldwide fear, The Port of Los Angeles, which saw its volumes dip because of a June Covid outbreak at the Yantian port in China, is bracing for another potential decline because of the latest shutdown at the Ningbo-Zhoushan port in China, many companies chartering ships are already adding covid contract clauses as insurance, so they won’t have to pay for stranded ships.
The shutdown at Ningbo-Zhoushan is raising fears that ports around the world will soon face the same kind of outbreaks and Covid restrictions that slowed the flows of everything from perishable food to electronics last year as the pandemic took hold. Infections are threatening to spread at docks just as the world’s shipping system is already struggling to handle unprecedented demand with economies reopening and manufacturing picking up.
The port is actively negotiating with shipping companies, directing them to other terminals, and releasing information on a real-time data platform, it said. To minimize the impact, it’s also adjusting the operating time of other terminals to make sure clients can clear their shipment.
Rwanda to continue aiding Mozambique in fight against terrorism, earlier this week, the government of Rwanda indicated that it would continue to collaborate with the government of Mozambique as well as other partners in the next phases of stabilisation and development after Rwandan and Mozambican troops recently repulsed insurgents from key areas of the Cabo Delgado Province.
Joint forces captured Mocimboa da Praia earlier this month, a key Mozambican port city that had been the headquarters of the Islamic State-linked terrorist group in Cabo Delgado Province since 2015.
This strategic port city for Mozambique had been an important logistics point for the insurgents in addition to being the terrorists’ stronghold in the province.
After the insurgents’ main stronghold was captured, more than 90% of the province is now free where operations to wipe out the terrorists are now focused on smaller pocket areas.
“Smooth seas have never made skilled sailors”