Beira Calling

How would you characterize the role of the Port of Beira in Mozambique’s logistics sector?

The Port of Beira is the second largest port in Mozambique by most metrics. It differs from Maputo, the number one, or Nacala, which is the number three, in that its main role is as a transit port. It has historically been used by Zimbabwe to access the sea. Its construction began in 1929, and 65%-70% of traffic at the port was transit cargo up until 2009. From that point, the Mozambican economy began to pick up, and then with the addition of coal traffic, and the problems in Zimbabwe, Mozambican cargo has taken on a much bigger role. Malawi has also slowly started to take care of the transit cargo deficit at this port, and is actually doing quite well. Zambia is a great market with considerable potential, but still has very strong commercial connections with South Africa. We are seeing them slowly return to Beira for the transportation of copper, sugar, tobacco, and fertilizer imports.

Does the port have sufficient capacity to meet growing demand?

The existing container terminal, which was built and started operations in 1992, is designed for 100,000 TEUs. At the same terminal last year we handled 170,000 TEUs, so you can appreciate the pressure. Over the past 12 years the average rise in general cargo has been 12-15%, while for the container terminal it has been 15%. We forecast major traffic increases over the next decade, and so we need to undertake massive investments. This includes, for example, constructing a completely new 600-meter quay, as well as the construction of the new fertilizer terminal, and a mineral terminal, and the upgrading of other existing terminals, and expansion of the existing container terminal. The new fertilizer terminal will allow us to increase the bulk fertilizer we handle from around 1,500 to 2,000 tons per ship per day to 7,000 to 8,000 tons per ship per day. Unfortunately, transportation is insufficient to cope with the off-loading capacity of ships. A docked vessel costs around $40,000 to $50,000 a day in demurrage. The coal terminal is not part of our concession agreement, but Vale and Rio Tinto have requested us to operate it for strategic reasons.

What trends can you detect in the Mozambican economy based on changing shipping patterns at the port?

There is a massive impact on the agricultural sector in both imports and exports. In terms of the amount of fertilizer being imported via Beira, in 2009 we used to handle not more than 70,000 tons per year, but in 2013 we will have easily reached 650,000 tons. With the fertilizer terminal my expectation is that in 2015 we will have comfortably arrived at the 1 million ton mark. Construction of the terminal will be done in 2014 and in 2015 it will commence operation. I want to see the 1 million ton mark in Beira, because the region handles around 1.5 million tons per year. The other side of the equation is exports, such as maize, white sisal, cotton, and tobacco. Out of the 650,000 tons that I mentioned before, roughly 60,000 tons is destined for Mozambique, with the sugar industry receiving its share. We have also seen a 20% annual rise in clinker imports over the past four years, which signals increased cement production in Mozambique, as is readily reflected in construction projects nationwide. Another point of reference I can provide is tobacco from Malawi. Until 2004 the Port of Beira had transported 2.5% of Malawi’s tobacco. Nacala Port used to take 17.5%, while the remaining 80% was shipped via South African ports. In stark contrast, we are now moving 82%-83% of Malawian tobacco.