In 2022, European coal importers dramatically switched sources, abandoning suppliers in Russia for those in other parts of the world. One of the main beneficiaries was South Africa’s Richards Bay Coal Terminal, which boosted exports to meet increasing demand from the continent.
However, not everything went according to plan as Richard’s Bay had to deal with a series of security issues, strikes aimed at increasing wages and even equipment shortages at state-owned rail operator Transnet SOC Ltd. Inbound coal deliveries to the port from the mines had to be cut, which resulted in a 14% drop in overall exports to 50.4mt (million tonnes). This was the lowest export volume over the past 30 years.
Despite this, the port terminal dispatched more than 14mt to Europe last year, equivalent to 28% of total shipments. This compares to a market share of only 4% in 2021.
However, the situation could have been even rosier had it not be for the aforementioned impediments. A major train derailment effectively slowed deliveries at one point in the year, with a noticeable outbreak in violence delaying recovery operations. Overall, the port was without export deliveries over a 22-day period because of the line blockage allied with industrial action by workers. Nevertheless, CEO Alan Waller expects the port to reach a target of 60mt during the current year.
In the open market, the price of coal soared to new records, making it now profitable for exports in South Africa to be trucked to alternative port outlets whenever Richard’s Bay is shut down.