South Africa's Commercial Ports Remain Open But Traffic Down Significantly

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Posted April 8, 2020

Although all of South Africa's main commercial ports remain open for business and bunkering operations continue, the coronavirus outbreak has led to a significant drop in cargo volumes and restrictions on crew changes.

Chrystel Bassett-Simmonds, a member of the IBIA executive committee and Managing Director of Lavin Energy Ltd, has sent Bunkerspot this report:

'The 2020 start of the new Fuel Oil Era seems like a lifetime ago now and the concerns and dramas over compliancy and qualities amongst other issues pale in significance to what we are witnessing on an unprecedented global scale with regards to the Covid-19 Pandemic which started somewhere so far away from our daily lives and moved most of us from observer to real life participant in many countries with almost HALF of the worlds’ population currently in some form of lockdown.

'South Africa has moved remarkably swiftly and decisively to avoid a humanitarian crisis, but any lockdown was going to have a negative consequence on the economy, albeit so would the humanitarian crisis . Adding to the pain of the current dynamic was the geopolitical tensions that have affected the oil prices and thus refinery margins in this past month with the world oil prices crashing when stock markets were already struggling under the intense pressure over the coronavirus outbreak.

'And with bad news coming in three’s, Moody’s struck on March 27th, downgrading South Africa to Junk status bringing an already buckling rand to its knees, and its worst ever level in history.

'South Africa has been on a legislated Lockdown since 26th March for a 3 week period. None of the 8 Commercial Ports are closed and commercial Cargoes ,both essential and non-essential cargoes are allowed to continue operations.

'With Global issues at the forefront of the Industry, it is still too early to assess the long term position of the shipping industry. With the Corona Virus obliterating the global oil demand for 2020, and dry bulk shipping negatively impacted as the Chinese manufacturing sector still recovers from its lockdown, there is without a doubt a knock on effect in terms of Bunker supplies with pricing being super competitive as suppliers cut their margins to move stocks and maintain volumes.

'In order to understand the global impact on South African Bunker demand, we looked at the historical data of the Port calls for Cape Town, Richards Bay, Durban and Algoa Bay for Q1 2020. Cape Town has experienced a significant drop in Port traffic for March of 28% compared with January, with volume down on Bulk Carriers, Container vessels and interestingly , 28% drop in Fishing Vessels. The Astron Refinery started their shutdown mid February with the expectation to start up mid April. This has now been delayed by a month but Astron are still able to continue to supply Bunkers in the Port of VLSFO and GO.

'Durban sees a drop in Bulk Carriers, Container and Cargo vessels calling port – in the region of 15-20%; and in Richards Bay Bulk Carriers are noticeably much lower in March than the start of the Quarter.

'ENREF have confirmed that they will bring forward their planned maintenance and shutdown imminently with NATREF currently considering their position. The supply for Durban and Richards Bay Bunkers should not be affected with current refinery stock levels across the board.

'Algoa Bay, with the offshore bunker Operations have maintained consistency of supply and volume of calling vessels throughout Q1 2020.

'Across the Ports, Transnet Port Authority took the Executive Decision to prohibit all Crew changes in all 8 commercial Ports.'

Source: bunkerspot