Trade winds turn hostile

Global supply chains are once again navigating a period of heightened complexity. From shifting geopolitical fault lines to seasonal production cycles and weather-related disruptions, multiple forces are converging to influence the cost, timing and reliability of moving goods across borders.

As the second quarter unfolds, importers and exporters alike are having to balance global uncertainty with local opportunity, staying agile in a logistics environment that continues to evolve.

Middle East tensions: a new pressure point for global logistics

The global shipping and logistics environment entering the second quarter of the year is increasingly shaped by geopolitical developments across the Middle East.

Security concerns around the Red Sea and Bab‑el‑Mandeb Strait continue to influence maritime trade routes and airline flight paths, contributing to ongoing Red Sea shipping disruption. Several shipping lines remain cautious and continue to divert around the Cape of Good Hope.

These changes extend transit times, tighten global vessel capacity and introduce volatility into shipping schedules.

For businesses managing imports into South Africa, the situation is complex. While more vessels pass along southern African routes, the broader effect is tighter global shipping capacity and fluctuating freight pricing.

Cargo insurance: war‑risk considerations

The Iran war continues to influence both marine and aviation insurance markets. Marine insurers have now designated certain areas, including the Red Sea and Gulf of Aden, as high-risk war zones. This classification can result in additional war-risk premiums and more stringent policy conditions for vessels transiting these waters.

While many Asia–South Africa shipping routes avoid these high-risk areas, the global insurance landscape remains highly sensitive to geopolitical developments.

Please note: Under Investec’s insurance policy, certain war-risk exclusions now apply. Although the policy includes the Institute War Clauses (Cargo), we have been notified by the insurers that coverage for War Risks has been cancelled for the following regions:

• Iran, including Iranian territorial waters up to 12 nautical miles offshore
• The Persian/Arabian Gulf and adjacent waters, including the Gulf of Oman
• Waters west of the line drawn from Oman’s territorial limit off Cape al-Ḥadd to the Iran–Pakistan border

We encourage clients who use their own insurance to review their current policies with their insurers in light of these exclusions and factor them into their logistics planning. Our team is available to provide further information or support regarding these policy changes.

Chinese New Year: the supply chain ripple effect

Chinese New Year has now concluded. Factories across China have reopened and exporters are rapidly clearing accumulated orders, triggering a new wave of Chinese imports into South Africa.

The period following the holiday traditionally creates a surge in shipments as manufacturers resume production and clear backlogs.

Major export ports including Shanghai, Ningbo and Shenzhen typically experience higher cargo volumes during the weeks after the holiday, increasing shipping from China to South Africa.

For South African importers this often results in shipment bunching and uneven vessel arrival patterns during March and April.

Ocean freight: the cargo wave moving toward South Africa

As Chinese exporters work through their backlog orders, shipping lines are frequently adjusting schedules and reallocating capacity. This is leading to irregular sailing timetables and ongoing challenges with sea freight from China to South Africa, including equipment shortages and uneven vessel scheduling.

Importers should be prepared for longer transit times and additional shipping delays as global container capacity remains constrained. Vessel bookings and space availability on the Asia to South Africa trade route remain highly unpredictable, increasing the risk of further disruptions.

Key factors to consider:

• Irregular sailing schedules
• Ongoing constraints in sea freight capacity and equipment availability
• Potential for additional shipping surcharges (including PSS/GRIs)

Air freight: post‑holiday demand and weather disruptions

Air freight logistics markets are experiencing similar pressures as factories resume operations following Chinese New Year.

Exporters frequently prioritise urgent shipments immediately after the holiday, creating a temporary surge in air cargo demand for products such as electronics, apparel and high‑value components.

At the same time, severe winter weather across major United States cargo hubs – including Chicago, Memphis and Louisville – has disrupted global air cargo rotations.

Because international air freight networks are interconnected, delays in North America can create international shipping delays across Asia, the Middle East and Africa.

For South African importers this may result in temporary air freight capacity constraints, higher spot air freight rates and slightly longer transit times while networks rebalance.

Domestic logistics: gradual improvement in South Africa

Despite global disruptions, South Africa’s import logistics environment continues to show gradual improvement.

Recent developments include equipment upgrades across container terminals, operational improvements at Durban port, rail reform initiatives opening the network to private train operators, and infrastructure investment aimed at improving freight corridors.

These improvements are gradually restoring confidence in the national logistics network and improving the reliability of container evacuation and inland distribution.

Note:

* Number of days delay to be expected at global ports by country and port (source: gocomet.com)

Shanghai-Durban freight rates 

Closing perspective

Global supply chains remain shaped by events far beyond South Africa’s borders – from geopolitical developments in the Middle East to production cycles in China and weather disruptions in major international air cargo hubs.

Yet despite these pressures, South Africa’s logistics system continues to improve. Ports are investing, rail reform is progressing and infrastructure recovery is gaining traction.

For importers who remain informed, flexible and proactive, the environment, while complex, is becoming increasingly navigable.

We recognise that recent developments in the logistics sector may pose certain challenges, and we are fully committed to supporting you through these changes. Our team of experts remains dedicated to delivering optimal solutions tailored to your needs and will continue to keep you informed of any significant updates within the logistics environment.

Should you have any questions or require further assistance, please feel free to contact us.