South Africa: Kumba CEO Rails At Transnet Inefficiencies After Interim Earnings Fall

Kumba Iron Ore has once again flagged the woes of state-run logistics company Transnet as it unveiled a fall in interim earnings, a decline mostly attributable to lower prices. Kumba's locust spraying programme has helped keep the rails clear of the pests, which can cause derailments when they swarm, but trains are still coming off the tracks.

"Logistics is still a challenge," is how Kumba CEO Mpumi Zikalala summed up the Transnet situation on a media call with journalists after the release of the Anglo American unit's interim results.

That is indeed the case, and amid the arid ochre landscape of the Northern Cape where Kumba operates, the challenges include locust infestations and the more typical South African dilemma of crime and gangsterism.

"Ore railed to port decreased by 3% to 18.4 million tonnes (Mt) with collaborative work between the Ore User's Forum (OUF) and Transnet on the maintenance of the Iron Ore Export Channel (IOEC) and the locust spraying programme, partially mitigating some of the challenges," Kumba said in its earnings booklet.

The locust spraying programme is aimed at swarms of the insects which can carpet the rail line in midsummer. When the critters are crushed by trains, they release an oily substance that can trigger derailments.

That programme seems to be working and is set to swing back into action when the swarms form again in summer. But with South Africa's rail network, it is often a case of one step forward, two steps back.

Kumba said that its OUF work and spraying programme "......

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