A presentation by Ms Brenda Horne-Ferreira (CEO: SASTaLC), at the Transport Forum SIG: "Driving down cost in the Supply Chain" on 3 September 2015 in Durban, hosted by Transnet. The topic of the presentation was: "Port Cost as a component of total supply chain cost".

1. TRANSPORT FORUM
DURBAN
Port Cost As A Component Of Total Supply Chain Cost
Brenda Horne – SASTALC CEO
3 SEPTEMBER 2015

2. Strive to aggregate inclusive, innovative, collaborative public private,
stakeholder advocacy and cooperation across all
modes of transport
Transport is a crucial link in the total supply chain

4. CLORCHEM - NCP COLUMBUS STAINLESS PTY LTD DIVINE MERCY TRADING
EVRAZ HIGHVELD EXXARO FRUIT SA - MZANZI
GLENCOR - XSTRATA HULAMIN SISHEN IRON ORE
COMPANY - ANGLO
MMC - MANGANESE METAL
COMPANY
PALABORA MINING COMPANY -
PMC
SAMREC
SAMSUNG SAPPI EXPORT
SERVICES PTY LTD
SASOL
SEABOARD INTERNATIONAL SIYANDA
TRONOX
INNOVATIVE COLLABORATIVE ADVOCACY ACROSS ALL STAKEHOLDERS AND MODES OF TRANSPORT

5. AURECON BARBERRY GROUP BIDFREIGHT PORT
OPERATIONS - BPO
BPL - BIDFREIGHT PANALPINA
LOGISITCS
GRINDROD LTD IMPERIAL LOGISTICS
ISAHA LANDSEA-LOGISTICS LBH
OCL- OUR CORRIDOR LOGISTICS PROSADC – LOADSMART QUATTRO LOGISTICS
SAVINO DEL BENE T-SYSTEMS
FNB/RMB
THE RIGHT MIX
DEPARTMENT OF
TRANSPORT
(Integrated freight)
IN PROGRESS: TOLL LOGISTICS
CTRACK; PROFESSIONAL
SHIPPING
IN PROGRESS:
TRANSNET

6. Globally Supply Chains Compete
Not Necessarily Only Products !!!
Hence The Cost And Efficiency Of Transport And Logistics Is
A Key Component Of International Supply Chains
And Port Costs (Rates and efficiencies) Are But
One Of Many Elements That Deserve Focus
A chain is as strong as its weakest link!

7. MANAGING TO TOTAL COST OF SUPPLY CHAINShttp://www.imanet.org/docs/default-source/thought_leadership/operations-process-management-innovation/managing_the_total_cost_of_global_supply_chains.pdf?sfvrsn=2
IMA – INSTITUTE OF MANAGEMENT ACCOUNTANTS – www.imanet.org

8. http://www.imanet.org/docs/default-source/thought_leadership/operations-process-management-innovation/managing_the_total_cost_of_global_supply_chains.pdf?sfvrsn=2

9. SHIPPER 1 - TEU via Durban to Hoganas, Sweden - CIF HOGANAS
ZAR/MT ZAR/MT ZAR/MT ZAR/MT ZAR/MT
2011 2012 2013 2014 2015
% of
Pre
FOB
% of
CIF Hog
% Change
2011/2015
Rail 339 374 392 426 459 65% 23% 35%
Cargo dues 53 18 31 33 34 5% 2% -36%
THC 54 58 61 74 90 13% 5% 67%
Export documentation 20 20 26 12 17 2% 1% -15%
Empty container
placement 0 73 110 110 15% 6%
Total PRE-FOB 465 543 511 654 710 100% 36% 53%
FOB-CIF ** delivered
Hoganas 652 1463 1556 1423 1264 64% 94%
Delivered NST-
Hoghanas - RTEU 1117 2006 2067 2077 1974 77%

10. SHIPPER 1

11. Rail
Cargo dues
THC
Export documentaion
Empty container
placement
SHIPPER 1 - 2015 PLANT TO FOB COST

12. 35%
-36%
67%
-15%
RAIL
CARGO DUES
THC
EXPORT DOCUMENTAION
-60% -40% -20% 0% 20% 40% 60% 80%
SHIPPER 1 % RATE CHANGE 2011 TO 2015
WORKS TO FOB
Series1

13. SHIPPER 2 – VIA DURBAN - DDP EUROPE
SHIPPER 2 - DDP EUROPE R/TEU R/T
% OF
FOB % OF DDP
Cargo Dues 2046 93 15% 7%
THC 1471 67 11% 5%
Contsainerisation & cross hauls 4025 183 30% 14%
Customs clearance 1500 68 11% 5%
Shipping Line Release Fee 1000 45 7% 3%
Transport to DBN 3500 159 26% 12%
WORKS TO FOB 13542 616 100%
Ocean freight -Europe 1100 14631 665 50%
CIF to DDP 100 1330 60 5%
29504 1341 100%

14. 15%
11%
30%11%
7%
26%
SHIPPER 2 - PLANT TO FOB
Cargo Dues
THC
Contsainerisation & cross
hauls
Customs clearance
Shipping Line Release Fee
Transport to Dbn
7%
5%
14%
5%
3%
12%
50%
5%
0% 10% 20% 30% 40% 50% 60%
CARGO DUES
THC
CONTSAINERISATION & CROSS HAULS
CUSTOMS CLEARANCE
SHIPPING LINE RELEASE FEE
TRANSPORT TO DBN
OCEAN FREIGHT -EUROPE
CIF TO DDP
SHIPPER 2 – PLANT TO DDP EUROPE

15. Contextualise the LPI
for Regional Expansion
WB 2014 LPI Customs Infrastructure Int shipments Logistics Q &C Track & Trace Timeliness
LPI
Country score rank score rank score rank score rank score rank score rank score rank
Germany 4.12 1 4.10 2 4.32 1 3.74 4 4.12 3 4.17 1 4.36 4
HK, China 3.83 15 3.72 17 3.97 14 3.58 14 3.81 13 3.87 13 4.06 18
South Africa 3.43 34 3.11 42 3.20 38 3.45 25 3.62 24 3.30 41 3.88 33
Malawi 2.81 73 2.79 62 3.04 48 2.63 108 2.86 70 2.63 100 2.99 100
Namibia 2.66 93 2.27 125 2.57 81 2.70 97 2.69 86 2.56 106 3.15 82
Angola 2.54 112 2.37 114 2.11 140 2.79 84 2.31 128 2.59 103 3.02 96
Botswana 2.49 120 2.38 112 2.23 125 2.42 129 2.58 99 2.40 127 2.94 103
Zambia 2.46 123 2.54 86 2.31 115 2.13 152 2.47 114 2.47 120 2.91 105
Lesotho 2.37 133 2.22 129 2.35 110 2.48 122 2.23 137 2.35 132 2.60 139
Zimbabwe 2.34 137 1.89 154 2.25 123 2.25 143 2.50 108 2.22 143 2.93 104
Tanzania 2.33 138 2.19 135 2.32 114 2.32 137 2.18 145 2.11 150 2.89 107
Mozambique 2.23 147 2.26 126 2.15 135 2.08 154 2.10 153 2.08 152 2.74 134
Congo, Dem. Rep. 1.88 159 1.78 158 1.83 156 1.70 160 1.84 158 2.10 151 2.04 159
RANGE OF LPI’S GREATEST
CHALLENGE TO REGIONAL
TRADE GROWTH
SOLUTION
INNOVATIVE
COLLABORATION
TO WORK
TOGETHER TO
IMPROVE QUALITY
OF SUPPLY CHAIN
SERVICESRegional Expansion: Overcoming Logistical Challenges to enable Southern African Supply Chains

21. SUMMARY –
Port Cost As A Component Of Total Supply Chain Cost
• Port cost are very important – every R = impact on global competitiveness
• Port regulator has demonstrated the importance of its role in SA
• We have to focus on ALL elements from plant to destination
• Equal focus on operational efficiency and costs
• All elements have to be benchmarked - individually and collectively
• All elements have to be regularly evaluated - individually and collectively
• Equal collaborate advocacy – across all elements – public private dialogue
• Very important that all stakeholders contribute to create a greater
understanding of the impact of all elements collectively across our
distribution chain.
• Lets look at the current work/documents on the table from DoT – it is our
responsibility to play our role as users/shippers & service providers

22. Areas currently on the DoT table to name but some:
1. The Launch of the National Transport Forum – Member Pillar 1
2. Development of the Integrated Multi-modal Transport Planning and
Coordination draft bill
3. NATMAP 2050
4. National Freight Logistics Strategy
5. National Corridor Strategy
6. National Land Transport Strategic Framework 2015-2020
7. Road Infrastructure Planning Strategy
8. Maritime Technical Committee Discussion Document
9. Re-visiting and potential redrafting of the ports bill
10. Twenty First Amendment) to the National Road Traffic Regulations. The
Government Gazette is No 38142 published on 31 October 2014
11. STER ……………..and many more
DOCUMENTS IN THIS REGARD AVAILABLE FROM SASTALC

23. SASTALC SERVING OUR INDUSTRY (90 Newsflashes since July 2014)-
• Strengthen mandate through > 25 industry associations – local, regional,
continental, global
• Double membership since July 2014
• Department of Transport joined as strategic government department member
= PPP
• Acknowledged by SADC as regional industry organisation
• MoU with Africa Union of Shippers Councils
• Facilitated SG of global shippers forum – 2 s/h engagements on Safe Container
Packing and Mandatory verification of container weights
• Facilitated engagement with SAMSA & Keys s/h’s – Mandatory Verification of
Gross Container Weights – (All export containers to be shipped from 1 July
2016)
• Facilitated a visit by high level delegation of Congolese Shippers Council
to engage with TRANSNET/ TPT/TFR/other terminals
• Submission to Minister of Transport on proposed freight truck ban over peak
hours

24. SASTALC SERVING OUR INDUSTRY (90 Newsflashes since July 2014)-
• Nominated to the board of the EMC - various meetings
• Participated in the NBF Afri-ID Working Group North South Rail Corridor
Meeting
• Participated in the various TRANSPORTSIG Transport Forums
• Participated in the Rail Working Group Meeting – Luxemburg Protocol –
register for rail equipment – finance security
• SADC Business forum in Gaborone - first SA shippers/transport representation
• COMESA – Transport association meeting invited by USAID
• Submission to NPR – pricing application
• PCC’s
• Participate in SARS stakeholder meetings
• Participate in associate member activities
• Submission to the NPR – on 5 year evaluation & sent out questionnaire
• Submission to DTI on the RIA of the Export development bill and sent out
survey

25. SASTALC SERVING OUR INDUSTRY (90 Newsflashes since July 2014)-
• Tripartite Transport and Transit Facilitation Programme Meeting in Gauteng in
August-Harmonisation of cross border transport –
• Prior meetings:
• Vehicle load management strategy and implementation plan &
• Vehicle load management MoU (VLM MoU)
• This meeting considered the validation of the following:
• Tripartite vehicle regulations and standards
• Driver Training and Licencing for Commercial Vehicles
• Harmonisation of Cross border Third Party Motor Vehicle Insurance Schemes
• Proposed Self regulatory Scheme – RTMS
• Tripartite Transport Registers (TRIPS), information platform and systems
• Vehicles, Drivers, Operators, Infringements, etc.
• Draft multi-lateral Cross border road transport agreement (MCBRTA)
• Implementation Plan for the Harmonised Tripartite Cross Border Road Transport Regulations and Standards
DOCUMENTS IN THIS REGARD AVAILABLE FROM SASTALC
• Mentoring women and youth industry associations
• Conference presentation to promote the SA transport infrastructure and
services as a voice of the shipper and their service providers
• Logistics business breakfast – facilitate public private sector dialogue !) Ports
and Shipping 2) Road Regulations 3) Changing Customs Environment 4) Rail -
right balance – opportunities and challenges

26. Please diarise the date of
our last Logistics Business Breakfast
Date: 13th October 2015
Topic: Rail and Intermodal Transport
“The benefits and challenges of the right balance”
SAFE TRAVELS – REMEMBER LIGHTS ON SAVES LIVES

27. BIDFREIGHT PORT OPERATIONS - BPO
BARBERRY GROUP
SEABOARD INTERNATIONAL
IMPERIAL LOGISTICS

28. OVERVIEW- DIAGRAM
PUBLIC SECTOR
SARS Legal
A
Act 30 and Act 31
Rules
Standard
Operating
Procedure
B
Data field
Management
C
SARS -
Operations
Inter front
D
PRIVATE SECTOR
Importer
Exporter
Guarantee/Risk
Activity
Licencing/
Registration
Legal
Entity
Person Facility
e-filing
EDI
Data fields
IT Platform
Reporting
Time
Data field
Compliance
Audit
1
2
3
4
5
Policies
Excise Act 91
Extended Supply ChainTrade
• Risk Profile/
Behaviour Patterns
• Compliance
• Import/Export –
Gap - Agent
Result in deliverables