Transnet to prioritise consumer goods after China’s slowdown

Transnet’s new CEO Siyabonga Gama has set out plans to reform the state-owned company as South Africa’s commodity exports suffer from China’s slowdown.

The port, railway and pipeline operator will focus in future more on fast-moving consumer goods and less on commodities.

“For a long time, we have relied on the voracious Chinese appetite for commodities that we move,” Gama said in an address to his employees, “under these circumstances, we could afford to provide capacity at any cost. This has changed, certainly for the next half decade, perhaps forever.

“The Chinese are shifting from an investment-led economy to a consumer-driven economy,” he continued. “Demand for many commodities such as coal, steel, manganese, magnetite, iron ore, etc is at its lowest levels in decades. This entire shift means pain for our customers and therefore us. When our customers are unable to sell, we cannot move any commodities.”