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ozambique is a country full of (mostly) pleasant surprises. There was little talk 10 years ago that it would become a major energy producer. Or that we would see vehicles made in Mozambique. Logistics companies best positioned in the Mmarket are those with their feet on the ground – and readers of FTW, the only freight publication to invest in regular fact-finding visits to SADC countries. FTW’s Africa correspondent, Ed Richardson, reports.

Cashew processing in Nampula province, Mozambique.

Photo: Ton Rulkens of Maputo Port Photo: Cover Design: Zoya Lubbee

Editor Joy Orlek Consulting Editor Alan Peat GENERAL NEWS SEAFREIGHT Assistant Editor Liesl Venter 2 Journalist Adele Mackenzie modernising logistics helping shippers Photographer Shannon Van Zyl 3 to match growth 18 save costs Advertising Jodi Haigh (Manager) Yolande Langenhoven Publisher Anton Marsh smoother customs opening new Correspondents 8 streamlines business 20 reefer markets Africa/Port Elizabeth Ed Richardson Tel: (041) 582 3750 Swaziland James Hall connecting smaller agoa boosts us trade [email protected] 10 22 ports to the world

Advertising Co-ordinators Tracie Barnett, Paula Snell CASHEW SHIPPERS Layout & design Zoya Lubbee GET CRACKING Circulation [email protected] Printed by JUKA Printing (Pty) Ltd

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FTW7093 October 2014 Mozambique 1 www.ftwonline.co.za How Mozambican cashew nut shippers got cracking complex supply chain with the farmers and government producers with greater which starts with a to replace 40-year-old trees bargaining power, and from million shippers – and to expand the area under a logistics perspective help A each with less than production. consolidate loads. 100 kilograms of fragile and Another important step was Finance for modernisation time-sensitive freight – is needed to address the cashew nut value and investment in processing to fill snack bowls and add an chain. At that plants is being essential ingredient to curries time the market provided and stir fries around the world, was dominated through the Mozambican farmers are also the Mozambican cashew nut. by two to three African Cashew benefiting from the Fairtrade A combination of civil war, middle-men. initiative (ACi), initiative. ageing and ailing trees and They controlled Co-operatives provide which created Nuts are packaged by policy missteps resulted in the the prices and producers with greater a Cashew Liberation Foods in the UK virtual collapse of the industry the logistics bargaining power, and from Matching Fund and distributed through that once accounted for around chain, which a logistics perspective help to accelerate the retailers Tesco and Sainsbury’s under their own brands, as 240 000 tons, or 30% of global created losses consolidate loads. development cashew nut production. By of 5% or more “ of the cashew well as through Waitrose, 1990/91Mozambique’s share of through poor industry by Traidcraft, Oxfam and Greencity world exports had fallen to 2.8%, handling. allowing public Wholefoods under the Liberation or just 22 000 tons. Cashew nuts are brittle, and and private investments to benefit brand. It was around this time that “brokens” have relatively little farm productivity and farmer Thousands of jobs are again international agencies and market value. income. being sustained at source businesses started intervening, American NGO CLUSA A key element of the initiative by the processing of nuts in and production has grown (Co-operative League of is to increase transparency along Mozambique. A series of policy mistakes first saw 98% of the back to 100 000 tons. USAID the United States) started the value chain through the use crop being exported raw to India describes the Mozambican empowering the farmers of laptops and smartphones. after the government – on the cashew industry as a pyramid. by helping them to form Productivity has increased by an recommendation of the World At its base are a million farmers co-operatives. These provide average of 30%, according to ACi. Bank – lifted all restrictions on with an estimated 18 million the export of raw product. trees in the country’s north- Indian processors could pay eastern regions, which have more than the Mozambican poor roads and little logistics factories, and by 2000 the last infrastructure. one had closed. On the plus side, Mozambique Processors returned to the has natural advantages, market in 2002 using more according to John Sutton, modern equipment and with the Sir John Hicks Professor technical support from Tech- of Economics at the London noServe (USAID). School of Economics. It begins This rebirth of the industry is marketing nuts in the October– supported by the government’s December period, when the rest INCAJU initiative, an integrated of the world is not producing. strategy based on cooperation The main market for raw cashew between the private sector, nuts is India, followed by government, non-governmental Vietnam and Singapore. organisations and communities. The most important Government funding is destinations for processed provided for the purchase of cashew nuts are the United fungicides and pesticides for States, the European Union, the treatment of cashew trees, South Africa and, more recently, and for the establishment of Saudi Arabia and Lebanon. Total processing plants. annual exports are valued at In addition, a surcharge of 18% around US$70 million. of the FOB price is imposed on Logistical challenges start at raw cashew exports. Some 20% source, with the average annual of revenues from the surcharge yields of trees being only 1-3 kg, are allocated to the development according to aid agencies. One of programme of the local industry. Cashew nuts and peanuts on sale in the main Maputo market. the first interventions was by the Exports of raw cashews are Dutch development agency SNV, also banned from October to which in 2002 started working December.

2 Mozambique October 2014 Mozambican logistics modernises to match economic growth Photo: Andrew Moir Andrew Photo:

Ed Richardson as brands, synergies, human now staffing them with young stiff competition from other ozambique’s window resources and restructuring. and hungry leaders who have harbours in the region. of opportunity for They are reinventing been carefully schooled in group Importers and exporters in logistics companies themselves because the strategy, systems and objective. , Zimbabwe, Swaziland, Mthat do not already Mozambican business Their country managers are much of Mozambique and have a strong base in the country environment is modernising no longer just managing, but Malawi all have a growing is closing fast. fast. are responsible for driving the choice of ports. So fast that companies new “Mozambique’s transition business. That choice has been created to the country are finding from a post-conflict country This is good news for shippers by the hauliers whose fleets it extremely challenging to to one of Africa’s ‘frontier and cargo owners because operate the length and breadth establish themselves. economies’ has been nothing everyone along the logistics of the sub-region. Over the past five years or short of impressive,” is the way chain is upping their game. New electronic customs so FTW has seen the logistics the World Bank describes the Mozambique’s economic systems make it easier and sector in Mozambique mature changes. growth of 7% in 2013 was led by quicker to cross borders, and from what could best be Shippers and cargo owners transport and communications, the road infrastructure is being described and understood as now expect logistics companies financial services and extractive improved. pioneering frontier companies in Mozambique to have the same industries, according to World Satellite and cellular networks which attracted business simply systems in place as are found Bank statistics. make it possible to track cargo by having a presence and some anywhere else in the world. What is interesting in the every step of the way. systems in place to one where Multinational logistics bank’s analysis is that it puts Knowing this, customers companies are in the process of companies have also been mining after transport and now want to be able to trace the re-engineering themselves. attracted by the promise of a communications as the main progress of their loads online. For the first time this year the boom driven by oil, gas, coal and economic drivers. There is simply no place to hide FTW team heard the heads of agriculture. The ports, which are for inefficient hauliers, freight Mozambican logistics companies Many have had offices in the independent of each other, forwarders, warehouse operators, talking about concepts such country for years, but they are understand that they face port authorities or clearing agents. Minerals power northern Mozambican rail

hree major rail projects in (4 mtpa), Rio Tinto 30.8% more than 11 million tons a year signed two concession agreements T northern Mozambique are in (2 mtpa) and Beacon Hill 7.7% (mtpa) by the end of 2015, growing to build the rail line and new port varying stages of development. (0.5 mtpa). to 13 million tons in 2016 and facility in December 2013. All are being undertaken in There are plans to increase 18 mtpa in 2017. If built to plan it will have a order to move millions of tons capacity to 12 mtpa, but the Concerns that Brazilian miner capacity of 25 mtpa by 2018. of coal from the Tete province current port infrastructure cannot Vale will restrict other miners The cost is estimated at through to the ports. handle more than 6.5 mtpa. from using the line it paid for has US$3.5 bn. First to be refurbished is the Due to come on stream in led to investigations into a third Thai Mocambique Logistica Sena line from the Moatize coal December is the line, 525-km line, from Moatize to the consists of Italian Thai basin to the port of Beira. which will link the coalfields to port of Macuse. Development Company 60%, It has a design capacity of 6.5 Vale’s newly constructed port Plans for the greenfield rail CFM (State-owned Mozambique million tons a year (mtpa). facility in Nacala-a-Velha along and port development are at an rail and port company) 20% and The line is shared by the three 912 km of track. advanced stage. CODIZA (Zambezia Integrated main mine operators: Vale 61.5% The line is planned to carry Thai Mocambique Logistica Development Corridor) 20%.

October 2014 Mozambique 3 www.ftwonline.co.za Mesquita companies unite to offer one-stop logistics number of Beira It operates along the whole services for heavy vehicles as well cattle and 516 goats on seven logistics companies length of Mozambique as well as equipment rental. thousand hectares, the farm now offering complementary as into Malawi, Zimbabwe and It has since moved into providing has more than two thousand cattle A logistics services have Zambia. earthworks services and handling and 1000 goats. joined forces to offer a one-stop Also falling under the new Grupo bulk cargo, and has a staff of 173. Facilities for tourists have been service under the Grupo Mesquita Mesquita brand is Danmo Service Also established in 2008 is added. banner. System, which was established in Agriverde, which is the sixth Agriverde is adding value to its According to Celso Mesquita, 1993 as the second company in company in the Mesquita group. output with the establishment of a one of the directors and owners of what is now the Mesquita group. It provides meat products to the butchery in Beira. the group, the move was prompted It provides maintenance and domestic market. Some 80 people are employed by by the growth in the Mozambican repair services for specialised port Starting with a herd of 1 436 Agriverde. and neighbouring markets. handling equipment. Shippers and cargo owners It has a staff of 92 in are looking for companies that the ports of Nacala, can provide a full logistics Quelimane and Beira. service, which includes clearing Multiservicos was and forwarding, transport and established as the third Shippers and cargo owners warehousing. company in the group are looking for companies “Clients are looking for companies in 2007. It provides that can provide a full that can offer a complete package. administrative, logistics service, which They only want to deal with one financial, human person from end to end,” he says. resources and “includes clearing and Grupo Mesquita brings together procurement support forwarding, transport and a number of support and spin-off to the whole group. warehousing. companies that were formed after The company has a – Celso Mesquita the establishment of Transportes workforce of around 55. Carlos Mesquita. With a staff of A year later Indico around 260, it employs some 39% of Logistics opened for the group’s regional workforce. business. It provides a range of Transport Carlos Mesquita cargo handling and shipping and has been one of the leading logistics services. transportation companies in Its highly specialised team of Mozambique since 1991, and is 15 provides ships’ agency, freight listed by KPMG as one of the top forwarding and clearing services. 100 companies in the country, Sermoz was established in 2008 says Mesquita. to provide maintenance and repair New dry port for Beira No plain sailing for cabotage

rupo Mesquita has opened a new port boundaries, according to fforts to increase the volumes of freight and imports/exports and 60 000-sqm dry port consisting Celso Mesquita, director of Grupo Efreight shipped by sea between all cargo is treated as a foreign G the ports of Mozambique are being import. of warehouses and an open container Mesquita. marooned in a sea of red tape. As a result the only companies yard in the Beira industrial area. A second phase, which will add FTW understands that one making use of the cabotage The multi million rand investment a further 800 000 sqm of bonded of the biggest problems is that service are those which have bulk is in response to the need to provide storage area served by a rail siding, is customs finds it difficult to shipments where all the freight is bonded facilities outside of the being planned. differentiate between domestic needed at the same time.

FTW2958SD 4 Mozambique October 2014 FTW3043SD www.ftwonline.co.za Beira no longer just a feeder port n increase in direct calls Plans are in place to handle over links serving the ports, as well as on the port of Beira 300 000 TEUs and 7m tons of the road network. means that it is “no general cargo a year by 2024. Construction has started on longer a mere feeder “We will make the necessary a new four-lane highway A linking Beira with port, but well integrated into the investment to accommodate the southern and East African shipping volumes,” he says. Machipanda on the networks,” says Félix Machado, Two new gantry cranes were Zimbabwean marketing and sales manager for the commissioned in March 2013. border. port of Beira. Productivity According to Machado the lines within the port calling directly on Beira include PIL, continues to Emirates, Maersk and CMA CGM. improve as a result Volumes have been steadily of the investment increasing, and are projected to and as the operators Volumes projected to reach reach a target of 210 000 TEUs and become more a target of 210 000 TEUs 3.04 million tons of general cargo proficient, he says. and 3.04 million tons of in 2014. The hub status general cargo in 2014. Ten years ago, in 2004, the port of Beira is being handled just 47 000 TEUs and supported by “– Felix Machado 84 000 t of general cargo. upgrades to the rail New quay planned The low cost option

lans are being rolled out for a driven by the revitalisation of eira offers the most cost- since October 1998. Pnew quay and upgraded fertiliser agriculture in the region served by Beffective ocean gateway in It has analysed and compared and dry bulk terminals in the port the port of Beira. the region for neighbouring the costs of moving cargo from of Beira. The dry bulk terminal will handle countries, according to Félix Harare, Bulawayo, Lusaka, Phase 1 of the fertiliser terminal a variety of commodities, including Machado, marketing and sales Kitwe, Lubumbashi, Blantyre will see the creation of a buffering chrome, iron ore, clinker, coal and manager for the port of Beira. and Lilongwe to Beira with the facility, according to Félix Machado, granite. Beira is managed by costs of using Durban and Dar marketing and sales manager for the Construction is due to start on the Cornelder de Moçambique es Salaam. port of Beira. first phase of a new general purpose (CdM), which is a private joint Beira is both closer and much Phase 2, planned for completion quay in 2015. in 2023, will see a terminal capable Some 600 metres of quayside will venture between Mozambique cheaper when compared on cost of keeping 160 000 tons of fertiliser be built on reclaimed land. Ports and Railways (CFM) and per kilometre, he says. in transit storage. The quayside will be designed to Cornelder Holdings based in “We are also on the safest It will be able to handle 7 500 accommodate rail-mounted gantry Rotterdam – Holland. corridors in Southern Africa – tons a day, or two million tons a cranes. CdM has operated the which further reduces the cost year. Three phases of development are container and general cargo of shipping goods through the Demand for fertiliser is being planned. terminals in the port of Beira port,” he adds. Distance in km between main ports and major cities

HARARE BULAWAYO LUSAKA KITWE LUBUMBASHI BLANTYRE LILONGWE PORTS ZIMBABWE ZIMBABWE ZAMBIA ZAMBIA DRC MALAWI MALAWI BEIRA 559 726 1 054 1 370 1 600 812 950 DURBAN 1 711 1 454 2 380 2 707 2 611 2 323 2 678 DAR ES SALAAM 2 634 3 028 1 985 1 951 2 290 2 031 1 667

Road transport cost per ton kilometre

HARARE BULAWAYO LUSAKA KITWE LUBUMBASHI BLANTYRE LILONGWE PORTS ZIMBABWE ZIMBABWE ZAMBIA ZAMBIA DRC MALAWI MALAWI BEIRA 72 94 137 178 208 106 124 DURBAN 222 189 309 352 339 302 348 DAR ES SALAAM 342 394 258 254 298 264 217

Source: Cornelder 6 Mozambique October 2014 FTW2916SD

FTW3041SD October 2014 Mozambique 7 www.ftwonline.co.za Smoother customs makes it easier to do business in Mozambique ustoms and trade reforms Mozambican customs officials are This is also lower than the South inspection of the completed external have helped Mozambique also working with the industry to African cost of US$1 980, according works. to move up three points in fine-tune the system. to the World Bank. Investor protection has been C the global “Ease of Doing The country scores better than the The biggest leap for Mozambique, improved through the enactment Business” index published by the sub-Saharan Africa average on all however, was in the category of of a new commercial code, which World Bank. key indicators identified by the World “dealing with construction permits”, allows shareholders to bring Mozambique moved to 139 out of Bank. where it moved from 123rd in the derivative suits against members of 189 economies in 2014 – up from 142. They include the time taken to world to 77th – a leap of 46 positions. the board of directors, and which It improved its “trading across move imports and exports and the “Mozambique made dealing introduces detailed duties and borders” ranking by five positions costs related to the movement of with construction permits easier liability for major shareholders from 136th in 2013 to 131st in 2014. goods through the ports of entry. by improving internal processes at and directors. It also expands “Mozambique made trading across According to the World Bank it the Department of Construction the scope of accessible company borders easier by implementing an costs US$1 100 on average to export and Urbanisation – although it information and the right to request electronic single-window system,” a container, compared to the also increased the fees for building the appointment of an expert to says the report. sub-Saharan African average of permits and occupancy permits,” says investigate the activities of the Teething problems with the system US$2 108. the World Bank report. company. severely disrupted trade flows early in It costs US$1 705 through South It has, however, become more Commercial dispute resolution 2013, but clearing agents interviewed African ports. difficult to connect to the grid. has been improved through the by FTW were unanimous that it has On average it costs US$1 600 to Mozambique now requires appointment of specialised judges since helped speed up the movement import a container into Mozambique. authorisation of a connection project and reduction in the time limits on of cargo. The regional average is US$2 793. by the Ministry of Energy, as well as enforcement procedures.

Mozambique shipping by the number

MOZAMBIQUE SUB-SAHARAN AFRICA SOUTH AFRICA TANZANIA NAMIBIA

DOCUMENTS TO EXPORT (NUMBER) 7 8 5 7 8 TIME TO EXPORT (DAYS) 21 31 16 18 25 COST TO EXPORT (US$ PER 1 100 2 108 1 705 1 090 1 750 CONTAINER) DOCUMENTS TO IMPORT (NUMBER) 9 9 6 11 7 TIME TO IMPORT (DAYS) 25 38 21 31 20 COST TO IMPORT (US$ PER 1 600 2 793 1 980 1 615 1 905 CONTAINER)

NATURE OF EXPORT PROCEDURES DURATION (DAYS) US$ COST Export documents · Bill of lading DOCUMENTS PREPARATION 12 230 · Cargo release order · Commercial invoice CUSTOMS CLEARANCE AND TECHNICAL CONTROL 2 250 · Customs export declaration · Inspection report from PORTS AND TERMINAL HANDLING 4 320 scanner · Packing list INLAND TRANSPORTATION AND HANDLING 3 300 · Terminal handling receipts TOTALS 21 1 100 Import documents · Bill of lading · Cargo release order NATURE OF IMPORT PROCEDURES DURATION (DAYS) US$ COST · Commercial invoice DOCUMENTS PREPARATION 16 490 · Customs import declaration · Delivery order CUSTOMS CLEARANCE AND TECHNICAL CONTROL 2 340 · Equipment registration certificate PORTS AND TERMINAL HANDLING 5 400 · Inspection report from scanner INLAND TRANSPORTATION AND HANDLING 2 370 · Packing list TOTALS 25 1 600 · Terminal handling receipts

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FTW2923SD October 2014 Mozambique 9 www.ftwonline.co.za Agoa boosts market access ozambican exports to the United States have the potential to Cashew nuts, titanium and tantalum increase from US$76m and gemstones are the main exports M to the US. a year to US$500m over the next two years thanks to market access offered through the African Growth and Opportunity Act (Agoa). Trade between the two countries has been growing since the signing of the United States-Mozambique Trade and Investment Framework Agreement (TIFA) in June 2005. Mozambique was one of the first of the 38 African countries that became eligible to export to the US around 6 500 products which are exempt from customs taxes as part of Agoa. US exports to Mozambique include energy products, wheat, trucks and tractors while US imports from Mozambique are mainly of titanium and tantalum, United States government held in free access for 97.5% of all tariff it is important to examine whether cashew nuts and gemstones. Washington in August this year. lines. any products can now be added to The forecast of strong growth in During the conference it was However, there are 316 tariff Agoa,” says the statement issued Mozambican exports to the US was announced that the United States lines – most covering agricultural after the summit. made by Mozambican trade and would be reviewing the list of products – that are not currently Opening up the United States to industry minister Armando Inroga products that are exempted from included. agricultural exports would benefit during a summit meeting between tariff protection through Agoa. “While these products have Mozambique, which has a largely invited African leaders and the The programme provides duty- historically been import sensitive, agricultural economy. Fuel policy creates logistics opportunities ozambique is ensuring that it well as the logistics infrastructure for respect national interests vis-à-vis Companies researching the Mbecomes a producer of fuel, the transport of the refined products. defence, navigation, research and viability of opportunities include fertilisers and other petrochemical New regulations which are in the preservation of marine resources, Enron Oil and Gas Resources, products by ensuring that “at least” process of being passed empower the existing economic activities and the Energy Africa, Sasol Petroleum 25% of the oil and gas extracted state’s negotiating body, Empresa environment in general.” International, Leopardus Resources in the country is destined for the Nacional de Hidrocarbonetos In terms of Mozambican Ltd, Zarara Petroleum Resources, domestic market. (ENH), to play a decisive role in legislation all petroleum and gas TotalFinaElf SA, Trefoil Ltd and This has far-reaching logistics promoting and commercialising resources are state property, and the Lonrho de Provuma Petroleum, implications. petroleum products. state has the right to participate in all according to the Commonwealth Plans to process the gas at sea and It states that “oil operations hydrocarbon operations at any phase. Network. export it will have to be adapted to are practised via a concession ENH is seeking partners to expand Companies that have gained bring at least a quarter of production contract resulting from public the northern ports of Pemba and prospecting rights to look for oil ashore. tender, simultaneous negotiation Palma for the LNG industry. include US-based Anadarko, ENI Refineries will have to be built or direct negotiation,” and that This is in addition to the of Italy, Artumas of Canada, Norsk – which will keep project cargo “the granting of rights to carry out multinationals already active in the Hydro of Norway and Petronas of specialists busy for some time– as petroleum operations must always country. Malaysia. Full Loads to Mozambique From citrus to steel Collections, clearance and deliveries Access to more than 100 trucks Tri-axle and superlinks

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The Port of Maputo... growing confidence from users.

Maputo Port ready for more volumes lose to 90% of New equipment, including It will also be reconfigured national rail company CFM, the cargo flowing two mobile harbour cranes, will in order to cater for the longer as well as Transnet Freight Rail through the ports of improve productivity. vessels that are calling on the in order to increase rail capacity C Maputo and Matola is Bulk handling capacity will be port. out of the Mpumalanga and committed through multi-year increased to a thousand tons an Once completed the channel Limpopo provinces. contracts. hour, according to Botha. will be able to accommodate TFR has committed to “This shows that users are In terms of the port master 280 metre-long, 80 000-dwt providing dedicated equipment confident that the port can plan the capacity for Maputo vessels. for the route. deliver on its commitments,” will be increased from 13 to 20 One refurbished tugboat Recently TFR allocated four says Johann Botha, commercial million tons a year up to 2020. which was previously stationed 40 wagon train sets as a weekly director of the Maputo Port Capacity for Matola will also in East London has also been service between Steelpoort Development Company (MPDC). go up to 20 million tons from acquired. in the Limpopo province and He expects demand to grow the current 7.5 million. Access to the port will be the ports of Maputo for the as the port is reconfigured Over the next year US$355m improved through the building transport of bulk chrome. in order to improve will be invested in projects of a northern boundary road CFM has stationed its efficiencies. such as maintenance and a new rail terminal for the drivers and locomotives at the Terminals and dredging of the berths handling of containers. Komatipoort border in order to storage areas are being to bring them back to “We need rail volumes to speed up the hand-over of the grouped in order to their design depth, and grow for the port to grow,” says wagons and improve minimise handling and the channel will be Botha. productivity. to optimise the use of dredged to 14 metres. MPDC is working with the A further US$328 is budgeted equipment. for upgrades between 2016 and 2020. This will include expansion of the Matola terminal, the building of the internal rail shunting yard and the Terminals and storage rehabilitation of berths 6, 7 areas are being grouped in and 8 to create two deep-water order to minimise handling berths with a draft of 14 metres. and to optimise the use of The current Port Master Plan includes additional equipment. “ investment plans of – Johann Botha US$2bn by MPDC and its sub concessionaires to 2033.

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Ed Richardson turrock Grindrod Maritime Cooking with gas has been gearing up to serve the new gas sector in Sturrock Grindrod gears up for growth SNorthern Mozambique. “Sturrock Grindrod Offshore was specifically set up at the beginning of growth, with the increase in GDP Beira, Nacala, Pemba and Grindrod group and our local of 2013 to bring the skills and far exceeding that of other places in Mocimboa da Praia, we have the knowledge and local staff we are resources of the Group to bear on Africa. staff and the skills in place to ready for what will prove to be an what is the most exciting sector of “It is very much the place to be for play an active role in assisting exciting time with a the industry,” says Rob Gardner, so many industries, and we believe our clients with the logistics massive influx of divisional executive of Sturrock that as an integral part of the supply challenge that is about to unfold equipment, skills Grindrod Offshore. chain we have a vital role to play. in northern Mozambique as and people that The entire Sturrock Grindrod “We have recently strengthened a result of the offshore gas will accompany team in Mozambique is being our operations in Mozambique by discoveries. this adventure,” strengthened to support the bringing in a strong management “With the backing of the he says. logistics operations required for accounts team. This includes major projects in the north which a branch manager in Nacala, have the potential of creating an where we see the new port economic boom in Mozambique. developments and the airport They include “discovery of gas off construction as a catalyst the Rovuma Basin, coal in Moatize, for this port to grow, and a A dedicated liquid natural the expansion of the ports at Nacala business development manager gas (LNG) park capable and Pemba and the proposal to in Pemba who has been tasked build at Afungi”. with growing the company’s of processing millions of A dedicated liquid natural gas already strong position there,” tons of gas a year is being (LNG) park capable of processing says Gardner. planned for the Afungi millions of tons of gas a year is Sturrock Grindrod “ peninsula area of the Cabo being planned for the Afungi has “been a part of the Delgado province. peninsula area of the Cabo Delgado Mozambican shipping province. industry for over four decades. –Rob Gardner “The trend for Mozambique is one “With offices in Maputo, Delivering the world

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FTW7088 www.ftwonline.co.za MPDC Beira upgrades rail system to takes over cater for growing volumes cabotage ajor improvements terminal are being made to the Beira rail system in lans to establish a M central Mozambique P dedicated cabotage in order to cater for growing traffic service to link the ports of volumes. Mozambique have been given Beira is served by the Sena and a boost by the acquisition Machipanda lines. of the Mozambique Opened in 2014 by the British Cabotage Terminal (TCM) Trans-Zambeze Railways company, by Portus Indico, the major the 575-km Sena Line runs from shareholder of the Maputo Dondo rail station in Sofala to the Port Development Company coal town of Moatize in Tete. (MPDC). It is at present the only rail link Management and operation serving the new Tete coalfields. of the terminal – one of the The Sena Line was open to coal The Port of Beira ... the main ocean gateway oldest berths in the port – will traffic on August 8, 2011 after for goods moving in and out of Malawi. the signing of a temporary tariff fall under MPDC. agreement with Tete coal mines. The terminal will now be able to provide additional Beira has become the main commissioned to establish the There should, however, be an services such as storage of cars export port for the coal. Its viability of the restoration of a alternative by the first quarter of and handling of passenger dedicated terminal can handle six branch from Sena to Vila Nova 2015. vessels, as well as other added- million tons of coal a year – the de Fronteira, and from there to Brazilian mining giant Vale is theoretical capacity of the rail link. value services through the Malawi. investing over $4.5 billion in a In 2013 over three million tons “leveraging off and sharing Beira is at present the main 900-km railway from Moatize of coal was carried on the line. of resources,” according ocean gateway for goods moving in through Malawi to the Nacala An average of 10 cargo trains to Johann Botha, MPDC and out of Malawi. port in northern Mozambique. operate daily between Moatize and commercial director. A feasibility study and master plan Macauhub quotes Vale Beira, and one general cargo CFM for restoration of the Machipanda Mozambique managing director “We are looking at the train a week. line is also being prepared. Ricardo Saad as saying that the rail service package we are able Steps are being taken to to offer and are also going upgrade the line after previous The 317-km Machipanda Line, link is due to be open by the end of opened in 1897 by Caminhos de 2014. to the market to see what is concessionaires failed to make the required,” he says. necessary investments. Ferro da Beira, links the port In the meantime, Mozambican of Beira to the Mozambique/ Corredor Logístico Integrado do The terminal consists of Portuguese company Mota-Engil 27 000-sqm of paved area, a has started work on the renovation Zimbabwe Norte [CLIN] 300m berth, 300m long and and upgrading of the Sena line in border town of has announced 5 000-sqm of warehousing in partnership with Edivisa. Machipanda in the arrival of a number of separate The upgrades include major Manica province. the first 10 work on the superstructure of the It is currently 10 locomotives from buildings. railway over the entire stretch handling an The number of daily cargo trains General Electric It also has a fleet of between Moatize and Beira between Beira and Moatize in average of one to move coal containers. order to increase the capacity to train a day, from Moatize to MPDC took control of the 20 million tons a year by February according to Elias Nacala. terminal in July 2014. 2015. Xai-Xai, director of the Sena Line This was the first delivery from Measures being considered The project is valued at Reconstruction Brigade (BRLS). an order of 80 locomotives by to support cabotage services approximately 162.7 million euros, The objective is to triple the CLIN, which is the rail and port include the reduction of fees according to Mota-Engil. Machipanda Line’s capacity to concession-holder for the Nacala and upgrading of the marine A feasibility study has been three million tons a year. Corridor. infrastructure, he says.

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Keeping pests at bay in Beira

hipping tobacco through Sthe Port of Beira is about a lot more than transport and logistics. Dealing with pests ranging from tobacco moths and spider beetles to bacon beetles and tobacco beetles is part and parcel of the process. The 2-4 mm beetle is a perennial problem for all companies involved in shipping the cargo through the port of Beira. Without certification the container is not allowed onto the vessel as it poses a risk to other shipments. Tobacco is treated prior to shipment in the warehouse or in the container. In addition, traps are set in the container, and checked on unpacking. In practice, loads are usually disinfected in Malawi, Zimbabwe and Zambia before being sent to Beira, and again before being loaded due to reinfection and the hatching of eggs and pupa not affected by fumigation. Maersk helps shippers to It is not only the containers that are subject to scrutiny. The ocean-going vessel should also be inspected and certified save costs for fitness to carry tobacco, according to the Transport aersk Mozambique a separate service provider for Information Service (TIS) is working with exports. of the German Insurance shippers to help This adds unnecessary costs, Association (GDV). M them reduce the according to Helweg. It is perhaps ironic that cost of doing business in the He and his team are focusing Mining companies can make millions of rand are spent on region by optimising their on optimising connectivity significant savings if they combating pests in a product logistics chains. between the Mozambican ports destined to go up in smoke “Mining companies, for of Maputo, Beira and Nacala use the same container that (literally)! example, can make significant and the hinterland. was used to carry chemicals savings if they use the same Maersk makes regular calls and other supplies to ship container that was used to carry on all three ports through its “ Line moves out production from the chemicals and other supplies to M-Express service. mine. ship out production from the Maersk Beira is working with into Beira dry mine,” says Michael Helweg, its group offices in the region – Michael Helweg port managing director of Maersk to educate cargo owners and Line Mozambique. shippers on how to save costs by full service depot has been But, instead of using the going through the Mozambican imports and exports, and in A established by Maersk same box and shipping line that ports. others requires a fresh approach within the Independent Beira brought in the supplies, they In some cases it is as simple to the logistics of moving goods Logistics Terminals (IBLT) in the region. use a different box and often as using the same container for grounds. The terminal helps reduce Promoting stronger Mozambique-Turkey trade pressure on the port and improves the efficiency of ozambican exporters Maersk Line Mozambique, worked is a major importer of the kind of raw vessels calling on Beira, as it Mand importers are being extensively in Turkey during his materials and agricultural products helps move the containers out encouraged to develop stronger ties previous posting and believes there is produced in Mozambique, he said. of the port quicker, he says. with Turkey. potential for Mozambique to increase Maersk can link exporters to Exports are also expedited Michael Helweg, the newly its exports to the country. Turkey through Durban and through stacking in the IBLT appointed managing director of Turkey’s economy is growing and it Cape Town. terminal.

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Mozambique if the revenues Newly appointed Mozambique on Maputo, Beira, Durban and Cape Safmarine is able to offer a generated by mining and gas in country manager, Heinrich Els, Town. through bill of lading from source to particular are not shared with identified the opportunity while part “It’s through this feeder that we destination. the poor. of the team focusing on regional link the Americas and Europe via The line’s offices in the region will The freight and shipping commercial opportunities at the South Africa,” he says. help plan the supply chain between industries are directly in the Safmarine head office. Reliability is assured as the vessel and the point of origin or line of fire. The line is able to help Safmarine has secured destination, he says. While the attacks are blamed exporters to adapt to preferential berthing Els has been visiting growers in on gunmen from the former changing market windows in Mozambique and neighbouring rebel group Renamo, they are a demand. Maputo, and also countries in order to explore further symptom of growing discontent “We are able to operates a direct opportunities and to understand the among the poor, who make up help exporters call on Beira and challenges facing the exporters. the vast majority of the people now focus Nacala. He is particularly upbeat about in the country. on Europe According prospects for the deep-water port of Despite impressive economic and America, to Els there is Nacala to the north. growth rates over the past few apart from the demand for reefer “There are no draught restrictions, years, Mozambique remains one historical trade cargo into and out and the capacity of the port is being of the world’s poorest countries. to and from the of Zimbabwe and increased. According to the Rural Far East and Mozambique. “APMM is already moving Poverty Portal, eight million of Middle East,” he “We have hundreds of containers of bananas Mozambique’s 23 million people says. done some trial through the port.” This provides were classified as “rural poor” The M Express shipments to the base on which exporters and in 2010. service offers support the expected importers in the region can build It is these people who work dedicated growth in reefer cargo their business,” he says. the land and live next to the road and rail links on which shippers in Mozambique and neighbouring countries rely. At this stage, with gas and Full loads oil revenues yet to start flowing We are able to help and coal mining affected by exporters now focus on a combination of logistics Europe and America, apart bottlenecks, low prices and Consolidations from the historical trade to quality problems it is too early CLEARING & FORWARDING • PROCUREMENT • WAREHOUSING and from the Far East and to tell whether Mozambique will “ be a success story like Botswana Middle East. where diamond wealth is shared • PACKAGING • IMPORTS & EXPORTS VIA AIR, SEA AND ROAD – Heinrich Els or Angola where only a few become super wealthy. Door-to-door Machinery imports reflect economic growth ANY consignment, ANY size, to and from ANYwhere in the world conomic growth in Malawi and Zambia,” says clearance, transportation and Innovative, cost-effective solutions to suit your needs EMozambique and branch manager Rameshan warehousing. neighbouring countries is Pathapati. Other regular imports include reflected in activities carried Sharaf is the local agent for containers of bicycles, spare out by Sharaf Shipping Agency. major international shipping parts and three-wheeler taxis It is clearly visible by the lines that call Mozambique, from India. volume of machinery that is handling various types of Exports include tobacco, Beira is the gateway to imported to Beira and other commodities ranging from bulk, timber, cotton, vermiculite, Mozambique, Zimbabwe, landlocked country’s for various automobiles and machinery to granite, tea, pigeon peas and Contact the specialists: Freight Team JHB: Tel: +27 11 262 0135 +27 83 236 7235 large-scale projects. containers. sugar. Malawi and Zambia. CPT: +27 82 568 6558 email: [email protected] “Beira is the gateway to The company also provides Volumes are growing on both – Rameshan Pathapati Mozambique, Zimbabwe, ships’ agency services, customs exports and imports, he says. www.chavda.com “ FTW6868 20 Mozambique October 2014 AFRICA specialist with a handle on Angola & Mozambique Now extending our network from Angola and Mozambique into Botswana, Namibia, Zambia, Zimbabwe, Lesotho & Swaziland

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maller ports along the “Most of the recent attention corridor steadily grow over the “Further south, the port of Mozambican coastline has been directed towards the next few years. Beira has confirmed its position are being linked to northern provinces and ports “In Pemba, this year we will as a strategic hub for cargo S global trade through where large oil and gas discoveries see the commencement of the going into and coming from the addition of new services by have fuelled investments. construction of its new port and Zimbabwe, Malawi and Zambia. the Mediterranean Shipping “The port of Nacala is well logistics base which will finally “Maputo has also seen Company (MSC). into its renovation project and see this province equipped with a important developments, “In response to the is set to complete its first phase functional container terminal.” attracting ever larger volumes new market demands in next year. In addition to this, Development is not, however, of cargo from South Africa’s Mozambique’s smaller ports we the rehabilitation of the railway restricted to the north of the north-eastern provinces,” have opened our offices on the link to Malawi will see this trade country. he says. river port of Quelimane and have set agency representation in Pemba,” says Captain Roberto del Vecchio, chairman of MSC Mozambique. MSC operates a feeder service connecting Quelimane and Pemba to Maputo, and from there to Durban or East Africa. The line is operating four vessels that connect Maputo, Beira and Nacala to Durban and the East African ports of Dar es Salaam and Mombasa. “Through Durban we offer a swift connection to and from Mozambique’s main import and export regions on MSC’s worldwide network of services,” he says. According to Del Vecchio, MSC is geared up for growth in Four vessels connect Maputo, Beira and Nacala to Durban and the East African ports of Dar es Salaam and Mombasa. maritime traffic to the north of the country. MSC opens Beira depot Expansion

55 0000-sqm container commitment to Mozambique. to double this figure over the next of vehicle A depot has been opened by “It is worth stressing that MSC few years. the Mediterranean Shipping has been present in Mozambique “This growth has largely been terminal Company (MSC) in the port city for over 20 years, so any driven by discoveries in the gas, emand continues to drive of Beira. investments oil and mineral the expansion of the “Situated just a few kilometres need to be sectors. D Maputo car terminal. from the port, MSC’s container interpreted “These depot offers an efficient logistic as structural resources have The facility now covers an base for both full and empty rather than attracted large area of over 48 000 sqm, with containers. driven by We’re looking at setting up a direct foreign a capacity of 202 000 units a year, according to Johann “We are looking at setting up a short-term similar facility in Nacala. investments, similar facility in Nacala where ambitions. not least in Botha, commercial director of we are also set to complete the “That – Cpt. Roberto del Vecchio the logistics the Maputo Port Development renovation and refurbishment of being said, network that Company (MPDC). our offices within the year,” says Mozambique represents Imported vehicles for use in Captain Roberto del Vecchio, has rapidly become“ one of the a crucial sector to bring these Mozambique will be moved to chairman of MSC Mozambique. fastest-growing economies in natural resources to fruition. the cabotage terminal, which He sees the investments as Africa, averaging 6.4% GDP “As MSC we are playing our was recently acquired by part of the line’s long-term growth since 2000, and looking role in this development.” MPDC.

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FTW7089 October 2014 Mozambique 23 www.ftwonline.co.za CFR records dramatic volume increase Joy Orlek “We’re seeing a lot of transhipment cargo from or neutral groupage Europe hubbing in Maputo and operator CFR have the advantage of a very Freight, volumes to active global partner in the East Airfreight exports to Mozambique have Africa market,” said Schmidt- Mozambique and the rest of F Löffler. increased dramatically over the past year, according to “Hamburg-based SACO Africa remain high priority. CEO Peter Schmidt-Löffler. Shipping, which is part of the – Stephen Bishop The company has singled World Wide Alliance, offers out Africa as a market of regular direct services from “ significant potential and Europe to East Africa which that they could be served on a Mozambique is already taking enables us to service the entire direct basis in the near future. a leading role in its African East African coast, including CFR’s airfreight division safari. Mozambique.” also has its focus firmly fixed CFR offers regular on the continent. “Airfreight direct services to exports to Mozambique and Maputo, serving Beira, the rest of Africa remain high Nacala and Pemba. priority,” says airfreight general And against a manager Stephen Bishop. “We’re background of We’re seeing a lot of developing our network within transhipment cargo from growing business in the country, Africa so that we can meet Europe hubbing in Maputo and as more and the DAP (delivered at place) and have the advantage of more shipping lines and DDP (delivered duty paid) a very active global partner introduce direct requirements of our customers. “ services to the likes “As always there is an ongoing in the East Africa market. of Beira, Nacala and focus on improving our buy – Peter Schmidt-Löffler Pemba, Schmidt- rates and competitiveness in Löffler is confident these markets.” Companies reinvent themselves to support growth

ransporters are having to total transit times from the identifying and recruiting young as the security precautions put Tre-engineer themselves in hinterland to the overseas talent and supporting employees in place by J&J. order to ensure that shippers markets, and is putting pressure through training. All its trucks are under enjoy the full benefits of on truckers to improve their Valle and other transporters constant satellite surveillance, improved efficiencies by the productivity as well. using the route also stress its and are monitored in the group’s authorities along the route as “We are working hard at advantages from a security operations centres throughout well as the port and shipping continuing to identify and perspective. the region. lines, according to Henrique eliminate any other internal “We have never had a truck Valle is confident that the Valle, general manager of J&J and external bottlenecks hijacked. In fact, we have never corridor – and J&J – has the Transport. through a process of constant lost a load of copper on the capacity to handle growing The introduction of direct improvement,” he says. route,” he says. volumes. calls by a number of shipping J&J’s Human Resources This is due to a combination of “We are ready and hungry,” lines is helping to reduce department is focusing on the nature of the route, as well he told FTW. Broken logistics leaves the poor hungry

ack of transportation, storage most affected by the loss because its to take a more proactive role a Bertelsmann Stiftung report on Land processing facilities result agriculture sector supports 70% of in supporting local small-scale Mozambique. in losses of some US$4 billion a year jobs in the country, according to the agriculture. The challenge is recognised by in grain crops alone for farmers in African Development Bank Group. “Agricultural productivity has government, and high-priority Mozambique and other sub-Saharan It attributes the main causes of shown very slow or even zero sectors such as agricultural countries. post-harvest loss to transportation growth rates in recent years, and production, employment by small This is enough to feed 48 million in open, unrefrigerated trucks, thus production of food crops has and medium-sized enterprises people a year, according to Feed the and lack of storage and processing remained weak. In addition, climate (SMEs), and human and social Future, the US government’s global equipment. change-related weather shocks have development currently account for hunger and food security initiative. These factors create an harmed harvests, particularly within 66.7% of the national state budget, Mozambique is among those opportunity for logistics companies the central provinces,” according to according to the report.

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FTW6975 October 2014 Mozambique 25 www.ftwonline.co.za Transit facility in port saves time and money ccording to newly associated activities in the port appointed Maputo until 2033. Intermodal Container The facility was developed A Depot (MICD) to create more space for cargo chief executive officer Allison handling in the port, and to Pinheiro, shippers are saving grow volumes through Maputo time and money by using by providing additional services the MICD, which is situated within the port boundaries, she adjacent to the DP World says. Container Terminal in the Port Services include the transport of Maputo. of full and empty containers Opened in May 2014, the from and to the container 54 000-sqm facility, including terminal, stuffing and destuffing an 8000-sqm warehouse, can of containers and consolidations accommodate 2500 empty and/ in the bonded warehouse. or full containers on the ground Containers are prepared at any given time, a throughput on-site where there is a wash of 240 000 tons pa of mining bay for both 20- and 40- foot minerals and a throughput of containers. The MICD will also The MICD facility... developed to create 240 000 tons pa of undercover carry out inspections and do more space for cargo handling in the port. cargo. minor repairs of containers. No bulk minerals are handled Reefers will be inspected and in the warehouse, unless bagged, cleaned before they are packed as it is a “clean” facility, she says. and there are reefer points on container terminal to be plugged Being within the port limits The MICD is a joint venture site for pre-trip inspections. in. and within sight of the container between DP World Dubai and The terminal is also designed “Fruit can be packed directly terminal means that there are Grindrod Mauritius. to handle the packing of from truck to reefer container, no delays when moving full It has the concession for the food products at ambient and be plugged in at DP World containers into the stack area storage, handling, packing/ temperature. The reefers will within a few hours,” says ahead of vessel loading within unpacking of containers and then be transported to the Pinheiro. stack dates, says Pinheiro. Signs of a revival in manufacturing sector here are signs that construction, with Mozambique we managed to stabilise either opening or expanding in T Mozambique’s set to invest billions in housing the price levels of cement in Mozambique. manufacturing sector is and infrastructure over the next Mozambique,” Armando Inroga, The KPMG report uses reviving. few years. Mozambique’s Trade and Sociedade Comercial Colosso, In time this should help “We introduced an initiative Industry Minister, is quoted outside Maputo, as “just one” balance imports and exports. of bringing cement factories as saying in a KPMG report on example of manufacturing One of the first sectors is into the country. With this, manufacturing in Africa. revival in Africa. “We intend to have market Its 26 employees manufacture competitive prices in the coming wooden objects ranging from two years so that Mozambicans furniture to structural items can have adequate low- such as beams, stairs and cost housing using high- flooring. quality material produced in “They ensure that they Mozambique,” he is quoted as keep their manufacturing saying. costs lower by working with a The opening of new cement variety of Mozambican trees, plants in the Sofala province has seen logistics companies allowing them to compete with handling clinker rather than traditionally cheaper imported cement imports. products,” says the report. Mozambique has an Increased cotton production abundance of high-quality has also led to the reopening limestone but a shortage of of the Riopele textile factory clinker. in the Maputo province after a The limestone deposits 10-year closure. US$12 million remain untapped due to high has been invested in spinning, logistics costs. weaving and dyeing equipment On a smaller scale furniture by the Mozambique Cotton and cotton processing plants are Manufacturers Consortium.

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FTW6988 October 2014 Mozambique 27 www.ftwonline.co.za Container tipper increases BLT capacity nvestment in a container to increase the efficiency of 55 000sqm provides space for warehousing on site provides tipper has enabled Beira moving their cargo through about 400 full containers at any storage for chemicals, fertilisers, Logistics Terminals (BLT) Beira port,” says Jonathan time as well as the capability dangerous goods and other dry Ito unload up to 1000mt/40 Middleton, to pack and cargo. TEUs of bulk containerised BLT warehouse unpack all Security has been upgraded commodities a day into a new manager. types of in order to warehouse and on-site packing facility in Beira. Demand for containerised handle copper and other The bulk is bagged inside the transport commodities. high-value minerals following the warehouse using bagging of bulk cargo We are now able to handle The facility recommendations by corridor machines in a facility designed in containers is any dry cargo. can also cater security specialists. to support shippers moving bulk increasing, he – Jonathan Middleton for out-of- “We are now able to handle through the port and by road. says. gauge goods. any dry cargo,” says Middleton. Two bagging machines on site In 2013 An empty Currently copper cathodes and are each capable of handling BLT unpacked around“ 2 000 container storage area is ingots are transferred directly 1500 tons every 24 hours. containers. designed for 80 TEUs. from trucks into containers and “Our facility helps clients An open logistics area of Over 25 000 sqm of then sealed on site. New logistics facility opens in Beira Users marketing the port ith the granting of a customs Wlicence, Independent Beira BLT&S is among the users Logistics Terminals & Services Iin Beira who are actively (IBLT&S) is now able to handle fully marketing the port. bonded transit cargo. Direct calls by the likes of Services provided by the terminal PIL, CMA-CGM, Maersk and include destuffing and packing, Delmas have made the port refumigation, consolidation and far more competitive for trade intermodal transhipment, according with the East, says Christian to managing director Christian Roeder, managing director of Roeder. Independent Beira Logistics “We can handle any cargo that Terminals & Services (IBLT&S). does not require warehousing,” he “The systems are working, and says. The facility can store 5 000 TEUs the port is ready to handle more at any given time. cargo,” he says. Equipment on site includes It now provides a viable forklifts for destuffing and packing, alternative to Durban and as well as container stackers. Dar es Salaam for the export “We transfer most commodities of bagged bulk cargo such as from truck to container within an away from the main city traffic on the “We focus heavily on security minerals and sugar, he says. hour,” he says. Beira-Machipanda highway. and safety. For example, we do not There are minimal delays caused It prefers to cross-haul containers service unbranded trucks, and we by rain as the paving, which covers at night or at off-peak times in also do not accept unroadworthy the entire facility, order to reduce vehicles. is designed to congestion on the “Proper” controls at the gate drain quickly. roads and to avoid ensure that IBLT&S knows who is Containers delays caused by on site at any time, and can stop Direct calls by are sealed and peak hour traffic. non-compliant vehicles before they customs cleared We transfer most All cargo is enter. PIL, CMA-CGM, at IBLT&S and commodities from truck to weighed in and Safety and security also come transported in container within an hour. out on a 70-ton through ongoing staff training, bond to the port. weighbridge following targeted recruitment. Maersk, Delmas This – Christian Roeder and all activities The company has set itself the minimises delays “ are monitored target of having more female and enables through a CCTV operators. shippers to meet stack dates as system within a fully fenced off site. “Our experience is that female the facility works as an additional High level (30 metre) light masts operators are involved in fewer staging area for the port, according both add to the security and ensure accidents. We are helping to open to Roeder. that operations can continue round up opportunities for females in the IBLT&S is strategically situated the clock. industry,” he says.

28 Mozambique October 2014 Purpose-built equipment moves Follow the taxman for freight to remote sites the action ilapidated road and rail The company has also and the beginning of the EPC Dinfrastructure as well as introduced its “Hotshot” service (Engineering, Procurement and nvestors wanting to know where regular flooding means that for expedited delivery of loads of Construction) work,” adds Ryan. Ithe action is in Mozambique logistics operations that could 3.5 tons and less to remote sites. The delay in these operations just need to follow the tax be comparable to those used for This is despite hold-ups in the impacts heavily on the logistics authorities. military purposes are required roll-out of the expected oil and players in the Mozambique Three new offices are being to move freight gas boom, as market who are ready and able opened by the Mozambique Tax to remote well as political to assist in the import and Authority (AT) in the cities of regions within factors which export of materials needed for Matola, Pemba and Tete. These Mozambique, are affecting such projects. are in addition to offices in according to investment Crane Worldwide Logistics Maputo, Beira and Nampula. Gerard Ryan, “Hotshot” service decisions opened an office in the port of All are also major logistics hubs regional vice by logistics Pemba in June 2013 in order to and the site of large-scale road, president introduced for expedited companies in service the oil and gas industry rail and warehousing investments. EMEA delivery of loads of 3.5 tons general, he in Mozambique, and is awaiting According to AT president at Crane and less to remote sites. says. the outcome of the upcoming Rosário Fernandes, the major Worldwide – Gerard Ryan There have presidential elections in order to investors based in these centres Logistics. “ been delays in determine their strategy going contribute 50% of the taxes raised “In some various tender forward. in Mozambique – despite being cases, purpose- processes for only 2.5% of the tax base. built and specialised equipment the planned LNG facilities in This contribution is expected is required,” he adds. Northern Mozambique. to grow to 70% over the next two Crane Worldwide Logistics “In fact some projects are to three years as gas and mining continues to make “significant” almost a year behind their projects come on stream. investments in all terrain heavy planned schedules. According to the Mozambican transport equipment in order “Therefore there is a time government the large projects to meet the needs of the local lag between the completion contributed some R3.4 billion in Mozambique environment. of the exploration drilling taxes during 2013.

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FTW7084 October 2014 Mozambique 29 www.ftwonline.co.za

Major Macro Economic Indicators Source: Coface

2011 2012 2013 2014(f)

7.3 7.5 7.0 8.0

GDP G rowth (%) 10.4 2.1 5.4 5.6

Inflation (yearly average) -13.1 -9.6 -11.8 -12.0 Budget balance (% GDP) -31.2 -41.8 -43.4 -44.8

Current account balance (% GDP) 45.1 -46.6 47.0 47.6

(f) Forecast *grants excluded Public debt (% GDP)

STRENGTHS (aluminium, coal) country at the beginning of the year, by the floods, particularly in the • Favourable geographic situation: • Inadequacy of transport and port is expected to pick up in 2014. Coal area of transport, will favour the long coastline, proximity to the infrastructures, which greatly production and especially exports, construction sector activity. Services, South African market restricts capacity for the export of impeded in 2013 by occasional particularly financial services, will • Considerable mining (coal), raw materials interruptions of the Sena rail link remain buoyant. Wage increases will agricultural and hydroelectric • Heavy dependence on international (floods, targeted Renamo actions), sustain household consumption. resources aid and on the South African will again drive growth. This year, inflation is expected to • Huge gas resources discovered off- economy Manufacturing sector (cement) remain below the 6% ceiling set by shore (2010) • Weak governance activity is expected to rise, due to the monetary authorities. The rise • Support from foreign donors and RISK ASSESSMENT improved electricity supply after the in prices is likely to be cushioned by investors (FDI) for the funding of More sustained growth in 2014, technical difficulties encountered in the metical’s appreciation against the mining and gas infrastructures driven by the industrial sector the exploitation of the Cahora Bassa South African rand (South Africa is WEAKNESSES Growth, which was marginally dam, Mozambique’s main source the main supplier of goods imported • Poor diversification; dependence lower in 2013 because of the impact of electrical energy. Reconstruction by Mozambique, except for fuel) and on raw materials prices of the heavy flooding, affecting the of the infrastructure damaged the high level of interest rates. Worsening of twin deficits Persistent corruption an issue he current President, uncertainty over the succession he public deficit is not expected to should again accelerate in 2014. Armando Guebuza, has of Guebuza, who cannot, under fall in 2014 because of spending This rise will still not be enough, T T been in power since 2005. He is the constitution, stand for a forecasts related to infrastructure however, to cover the sharp increase also the leader of Frelimo, the third term. He was, however, projects, as well as the expected rise in imports. There is still a great need party which has governed the again chosen to head his party in public sector wages. The strikes, for capital goods, both for mining country since its independence for five years in September 2013, which broke out in 2013 in the operations and for the exploration of in 1975. Attacks by Renamo, suggesting that the constitution medical sector led to a 15% rise in the immense gas reserves discovered the traditional opposition party, may be reformed to allow him to salaries for this category of public off the Mozambican coast in 2010. which opposed Frelimo during stand again in the next elections. sector workers and further public Moreover, rising real wages will the civil war (until 1992), have Regarding governance, sector wage demands cannot be increase demand for consumer goods. become more frequent since the business climate remains excluded. The prospect of the October The current account deficit will 2012. Its resources remain difficult. Mozambique is relatively 2014 national elections (legislative exert strong downward pressure on relatively limited, but they are less highly rated than its main and presidential) is expected to make the metical exchange rate, but the nevertheless able to affect the neighbours (with the exception it difficult to control social spending. depreciation of the Mozambican country’s economy (blocking of of Zimbabwe) according to Moreover, the current account currency against the dollar is the only railway line allowing the the World Bank’s governance balance is also expected to worsen. expected to be limited due to the transport of coal). indicators. The country suffers After a slowdown in coal exports influx of capital into a country whose Meanwhile, in the run-up to from persistent corruption in 2013, due mainly to the floods growth prospects and whose gas October 2104 elections, tensions as well as from the mediocre which hit transport despite the rise in potential remain very attractive for between the two movements performances of the public production, sales of mining products foreign investors. could be revived. Finally, there is services and the judiciary.

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FTW2784SD October 2014 Mozambique 31 www.ftwonline.co.za Port and rail rapport build confidence in Maputo iscussions between Mozambican rail authority CFM companies like OCL to offer improvements and reroute their the port of Maputo, on how to streamline operations a greater variety of solutions cargoes through the Maputo Transnet Freight between the three have given to shippers wanting to route Corridor, he believes. Rail (TFR) and the users and potential users of the through Maputo. “We are currently processing D “We are always looking for all customs clearance for port of Maputo a “confidence boost,” says Jorge Ferraz, different solutions in order imports and transit cargo at managing director of Our to simplify and speed up the K4, with the release of trucks Corridor Logistics (OCL). movement of cargo,” he says. It averaging three to four hours was for this reason that OCL for imports and 20 minutes for “The port is working very opened an office at KM4 to road-hauled transit cargo,” he hard on its relations with the more effectively process the says. rail authorities. As a result clearance of road-hauled cargo OCL is currently handling there is a completely different between Mozambique and around 350 trucks daily mood among shippers,” he says. South Africa, be it imports, through K4. Better rail links will enable exports or transit. A joint venture agreement Current with a South African clearing infrastructure and logistics company enables development OCL to offer the full range and the of services on both the South elimination of African and Mozambican sides The port is working very unnecessary of the border. hard on its relations with red tape at K4 It has also opened an office the rail authorities. will ensure that in the northern port of Nacala shippers will in order to meet the growing – Jorge Ferraz start seeing the demand for its services at the “ benefits of the rapidly developing port. Beira corridor needs an image makeover

ll the Beira corridor needs to handle bulk, containerised, increasingly competitive,” he 21st century and ensures A for volumes to grow even project and out-of-gauge cargo. says.” accountability and transparency,” faster is “for clients to realise J&J has almost 20 years’ The corridor is becoming he says. the full potential of Beira and experience in cross-border more competitive because of the “The corridor was just going allow us to prove it to them,” says transport and employs over cooperation between the landside through growing pains. Freight Henrique Valle, general manager 1 400 people. logistics industry, customs, the is flowing much faster through of J&J Transport. Valle, who is the general port authorities and the shipping the borders thanks to the Janela J&J is a one of the biggest manager of the company with 13 lines. Unica system and transit times road transporters, specialising years of experience in shipping “Hiccups” initially experienced have been shortened. in international, national and logistics on three continents, with the introduction of the “We have aligned ourselves transportation and logistics is a strong proponent of the Beira Single Electronic Window with the SEW/Janela Unica between Mozambique, Corridor. (“Janela Unica”) customs system system and as a result our trucks Zimbabwe, Zambia, Malawi “Beira is happening. It is the were quickly overcome when move through the border with and the Democratic Republic of gateway to the hinterland. the industry and customs sat ease,” he says. Congo. “We are seeing more and more around the same table and found J&J has its own in-house legal It manages a fleet of its own enquiries from people using solutions. team to ensure compliance with trucks pulling a variety of flatbed the other corridors as word “The customs system the regulations in the different and drop-side trailers designed gets out that Beira is becoming has catapulted us into the countries in which it operates. M&S Logistics • Global ISO tank operator • Founded in South Africa in 1996 • Safe environmentally friendly transport of bulk liquids, into and out of SA • Specialists in the Oil & Gas Industry • Highest standards of service, quality and safety • ISO tanks are completely multimodal and can be used for bulk storage Please contact us for further information: Johannesburg: (011) 804 3630 | Durban: (031) 312 3212 | Cape Town: (021) 418 5870 | E-mail: [email protected] | www.mslogisticsltd.com

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FTW3042SD October 2014 Mozambique 33 www.ftwonline.co.za Transitex records 25% airfreight growth ransitex Mozambique has seen a 25% growth in airfreight compared More and more international airlines are flying into Mozambique. T to volumes in 2013, according to country manager Alexandre Franco. Through its global and local network Transitex is able to offer a door-to-door service to most destinations in Mozambique. Airfreight growth is being supported by the arrival of more international airlines. Ethiopian Airlines, Kenya Airways, KLM, SAA, Malawian Airlines, Precision Air, Air France, Qatar Airways, TAP Portugal, United Airlines and TAAG all have scheduled flights into Maputo International. LAM, the national airline, flies to Inhambane, Vilankulos, Lichinga, Chimoio, Quelimane, Pemba, Beira, Tete and Nampula. Massive construction keeps container loads ticking

he manifests of cargo There is a mix of consumer Transitex handles the full with logistics solutions for Tbeing handled by Transitex goods, equipment, dry goods operation, including arranging the movement of goods and Mozambique clearly show that and agricultural supplies police escorts for the out-of-gauge equipment,” he says. the region served by the three included in the more than cargo. main ports is under construction. 2 500 containers Transitex In addition, “we are moving Contents of the many moved through the three ports around 20 trucks a week of containers being moved by up to August 2014. project cargo between South Transitex through Maputo, Project cargo has included Africa and Mozambique,” he says. Beira and Nacala in the first six the delivery of 20 000 railway There is also strong demand months have included ceramic We are moving around 20 tiles for the large number of sleepers from South Africa for the company’s warehouses in trucks a week of project new hotels and entertainment and loads of 11 000 rails per Maputo and Beira. cargo between South Africa complexes being built, as well shipment discharged through “Transitex Mozambique is and Mozambique. as fittings and furniture, says Beira. well positioned to assist new country manager Alexandre Heavy machinery is being companies to penetrate the “– Alexandre Franco Franco. moved through Beira to Malawi. market and to support them

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t is not only the Brazilians, Indians said in a statement. Iand Chinese who are interested Sunflag Iron And Steel, which in mining coal in the Moatize and signed a 25-year concession Mucanha-Vuzi coal basins in the agreement for the mining of the coal Tete province of Mozambique. in Mozambique, has its headquarters Sol Mineração Mozambique, a in India. subsidiary of Kenya’s Sunflag group, The company expects to sell 0.8 mt is set to invest US $222 million in of coking coal and 1.2 mt of thermal the Tete province. coal a year. Founded in the 1930s as an The Tete province is considered East African garment and textile as the world’s largest undiscovered company, Sunflag has since coking coal province and has the expanded globally into steel, textiles, potential to supply around 25% power generation and health care. It of the world’s coking coal by the has steel plants in India and Nigeria. year 2025 – providing the logistics “The Feasibility studies revealed links are in place to move the the presence of 115.46mt of coal, commodity. of which only Transit... 44.9 mt can be commercialised, comprising 17.3 mt of dedicated to coking coal and 27.6 mt of steam coal,” Sol Mineração dedicateddelivery efficiency Mozambique director Ravibhusan to delivery Bhardwej Innovativeefficiency freight solutions ensuring your competitive edge Connecting your cargo to and from Mozambique and beyond… Road freight of perishable goods, Airlink Cargo can connect your cargo to and from Nampula, Beira, Tete, Pemba, Vilankulos and Maputo - regionally and internationally with the general & industrial consignments, help of strategic partners. For more information contact us at 011 390 9900; within the RSA & SADC REGION email [email protected] or visit www.airlinkcargo.co.za

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James Hall he Maputo Corridor Focus on border efficiency Logistics Initiative (MCLI) was created to address the entire route,” said Mommen. bribes for services. However, progress Railway is operating at only 50% T lack of efficiencies on the While the Lebombo/Ressano has been positive and the investment capacity to Maputo. Maputo Corridor, some of which Garcia border post is currently of $204million in the doubling and MCLI stakeholders say charges still remain in place. Enormous open for 18 hours, the goal of 24/7 electrification of the railway line to ship to Mozambique by Transnet political will has however resulted operations has still not been met. between Ressano Garcia and Maputo Freight Rail must be lowered to in continued investment in This, along with the very slow will go a long way towards increasing encourage more SA shipping to improvements of key infrastructure progress on the implementation of rail efficiencies which are much Maputo. With just over 15 000 tons which has been responsible for the the One Stop Border Post, pose very needed in view of the increasing bulk of bulk cargo moving through the stellar increase in volumes along the serious threats to the competitiveness cargo volumes being transported on border on a daily basis, the need for corridor in recent years, says MCLI of the corridor, says Mommen. the corridor, she added. additional rail capacity has never CEO Barbara Mommen. “The Single Electronic Window Clearly more needs to be done to been keener. The MCLI outlined the system was implemented by attract SA shippers to Maputo’s port. developments and problems facing Mozambican Customs last year and The drop in the coal price has seen greater use of the route connecting this process has greatly improved an underutilisation of the Grindrod industrial Johannesburg with the flow of cargo through the border, coal terminal, but the port has Maputo’s port via the Lebombo despite initial teething problems. implemented a plan to take up the border post recently. While these continue to be dealt excess capacity by moving other bulk “The border crossing ultimately with, the implementation of the cargo to the terminal for handling The Maputo Corridor stands controls the potential of the Maputo Single Electronic Window is a crucial at Matola. Salgaocar Swaziland, and falls by how fast and Corridor which stands and falls by step towards best practice in customs whose iron ore tailings are moved easy it is to cross the how fast and easy it is to cross the clearing and modernisation.” The by rail at cheaper rail freight costs border. border between Mozambique and increased electronic interface makes offered by Swaziland Railway, is South Africa. Inefficiency at the it harder for corrupt customs officials possibly the Maputo port’s single “– Barbara Mommen border means inefficiency along the to hold up shipments by demanding biggest customer. Even so, Swaziland Tsogo Sun’s US$30-million vote of confidence sogo Sun’s decision to invest Mozambique is expected to grow TUS$30 million in its beach- by 8.5% in 2014 and 8.2% in 2015, front Southern Sun Maputo according to the African Economic hotel is a “clear message that we Outlook website. believe in the future growth of “It makes sense to embrace the Mozambican economy,” says the opportunities and invest in general manager Bruce Chapman. Mozambique, with its growing The hotel was closed for economy and its attractiveness four months as construction to South Africans as well as crews added 111 rooms and new international travellers,” he says. conference facilities. Southern Sun Maputo is helping At the same time, the existing The recently refurbished Southern Sun Maputo Hotel. to promote tourism to the city. 158 rooms were refurbished to the A beach cleaning machine from same standard as the new rooms, Connecticut in America is used to the restaurant was expanded clean the beach in front of the hotel and the lobby and back-of-house drinks – has been doubled in size Sun Hotels, the company made every day. facilities upgraded. and now has a deck overlooking the the investment because of “We’re not just taking ownership The very popular bar area – one Indian Ocean. the continued growth in the of the hotel, but of the beach as of the favourite venues for informal According to Richard Weilers, Mozambican gross domestic well, which we believe falls under business meetings and after-work chief operating officer of Tsogo product (GDP). our care,” said Weilers.

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Top Mozambican From earth movers to trade partners outh Africa was the top exporter Sto Mozambique in 2013, with moving earth the European Union being the biggest importer from the country. oving out-of-gauge According to European Union cargo is all in a day’s statistics, goods and services from work for Specialized South Africa accounted for 26.4% of Transport, part of the all imports into Mozambique. The M value was R30bn. J&J group, which operates a fleet of India was next with a 14.1% trucks with standard flatbed trailers market share (R16 bn), followed by as well as low loaders, including a China (12.7% share valued at fleet of tippers. R14 bn). The tippers are being used on This is just ahead of the European construction sites throughout the Union’s share of 11.4%, or R13.5bn. region. The other top 10 suppliers There are 45 x 19cbm/16cbm to Mozambique are Australia tippers available to move sand and An abnormal load on its way... bread and butter for Specialized Transport. (4.3%), USA (3.2%), Japan (2,8%), material for local construction. Singapore (2.7%), Thailand (1.6%), Abnormal loads are carried as far and Brazil (1.3%). as the Democratic Republic of Congo There is little balance to the Specialized Transport operates to the west, and Tanzania to the has to take into account variable flows, however. Mozambique’s north. factors such as permissible maximum out of its own yard on the outskirts biggest export destination by far is “We have the knowledge and weight, mass distribution, gross of Beira. the European Union, on 36.6%, or experience to move heavy loads in combination weights, width and It also has the systems and R18bn. Mozambique, Zimbabwe, Zambia, height,” says managing director Chris equipment in house to handle South Africa is next, with a share Malawi, Tanzania and South Africa Morris. project cargo to the various of 30.5% (R15bn), followed by China as well. Equipment of up to 70 tons destinations. (9.4% and R4.5bn). “The transportation of abnormal includes mining, manufacturing and Specialized Transport has its own The next five are India (5.1%), loads is governed by different agricultural equipment, according to escort teams in order to expedite the Zimbabwe (2%), USA (1.6%), Japan requirements in each country. One Morris. transport of loads. (1.4%) and Russia (1.45).

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Airlink Cargo...... 37 DSV Air & Sea...... 25 Maersk...... 5 Röhlig Grindrod...... 23 Allen Wack & Shepherd Global...... 14 Easyclear...... 9 Manica Group Mozambique...... 17 Safmarine...... 7 ATC Aviation...... 27 Frits Kroon Transport...... 33 Matola Cargo Terminal...... 35 Semwat Transport...... 27 Beyond Africa Logistics...... 13 Grindrod Limited...... 33 Mesquita Group...... 23 Southern Sun Maputo...... 39 BLT Beira Logistics Terminals...... 25 IBLT...... 31 MCLI...... 1 ST Specialised Transport...... 29 Cargo Services Beitbridge...... 34 Ignazio Messina...... 31 MICD Maputo Intermodal Container Sturrock Grindrod Offshore...... 7 CFR Freight...... 36 Interlogix...... 19 Depot...... 13 Swaziland Railway...... 17 Chavda Freight...... 21 JBN International...... 23 MSC Shipping...... 35 Transcom Sharaf...... 17 CMA CGM...... 16 J&J Transport...... 19 Namgola Logistics...... 36 Transit Freight Co-ordinators...... 37 Cornelder de Mozambique...... 11 Lalgy Transportes...... 15 Nucleus Mining & Transitex...... 9 Crane Worldwide Logistics...... 4 LBH Mozambique...... 9 Africa Logistics...... 17 Transport Holdings...... 27 Destrans...... 10 LBH Xpress...... 31 OCL...... 19 United Container Depot...... 38 DP World Cargo Lombard Insurance...... IBC Port of Maputo...... OBC UPS...... IFC Services Mozambique...... 25 M & S Shipping...... 32 Prestmarine International...... 27 VTH...... 40

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