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Transport strike hits fuel supplies

Oct 02 2012 13:46 Reuters
A truck set alight in the often violent transport

A truck set alight in the often violent transport strike. (Source: e.tv)

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SUPER GROUP LIMITED [JSE:SPG]

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IMPERIAL HOLDINGS LIMITED [JSE:IPL]

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BARLOWORLD LIMITED [JSE:BAW]

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Johannesburg - South Africa’s fuel suppliers are starting to feel the pinch as a strike by more than 20 000 truck drivers enters its second week, with deliveries to pumps delayed and stations running out of certain types of fuel, an industry body said on Tuesday.

The walkout by drivers asking for higher wages has affected 40% of fuel tanker trucks, it said, adding to pressure on Africa’s biggest economy from wildcat strikes by 75 000 miners in the platinum and gold sectors.

“We are operating under difficult challenges. We are seeing more and more delays of fuel trucks into service stations,” said Avhapfani Tshifularo, head of the South African Petroleum Industry Association (Sapia).

“More service stations will start running short of certain grades of fuel if it continues into next week,” he added.

The fuel suppliers in South Africa include Shell, BP, Total, Chevron, local petrochemicals group Sasol and Engen, which is majority-owned by Malaysian state oil group Petronas.

Hundreds of striking truck drivers marched in the centre of Johannesburg on Tuesday, chanting and waving cardboard placards, demanding a 12% rise in wages.

Employers have so far offered an increase of 8.5%.

“We drive big trucks but we don’t even make R2 000 ($240) a week. I only make that if I work overtime,” said David Mohlahlo, one of the protesters.

Talks between unions and the employers were expected to resume on Wednesday.

The strike by truckers has mainly impacted transport and logistics companies.

“We are severely affected,” said Marius Swanepoel, chief executive of logistics at Imperial Holding [JSE:IPL], whose fleet of 5 000 trucks hauls consumer goods and fuel.

“In some of our depots between 50% and 80% of our trucks are not on the road,” he added.

Rival Super Group [JSE:SPG] is losing up to R6m a week, chief executive Peter Mountford told Reuters.

"There are 3 000 trucks that are meant to be on the road but they are not,” he said.

Other affected companies include Grindrod [JSE:GND], Barloworld [JSE:BAW] and Bidvest [JSE:BVT]. Mining and manufacturing groups said they could suffer if a prolonged strike cut deliveries of diesel used to run heavy machinery.

A long strike could also affect electricity supply in South Africa, which relies on coal for 85% of its power. Almost a third of coal is moved by trucks, power utility Eskom said.

“There are five stations which are at risk of falling below their minimum days’ stock levels if the strike persists,” Eskom said.

An interruption in coal supplies would further strain Eskom, which is already struggling to meet rising demand for electricity and is hoping to avoid rolling blackouts that brought South Africa’s industry to its knees in early 2008.

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