South Africa coal train activity halted again

Coal deliveries to Richards Bay port are likely to be held up after train service along South Africa's northern rail corridor was suspended today, on reports of theft between Ermelo and RLRA.

This incident came less than a week after deliveries to the Richards Bay Coal Terminal (RBCT) were affected by a train failure at Enqolothi on 8 June.

National rail operator Transnet Freight Rail (TFR) issued a statement informing that both sections of the coal line will remain closed, with no indication of when services will resume.

The suspension will prevent empty wagons from Ermelo reaching coal mines for loading. A producer told Argus that some of its trains were cancelled after the incident.

Coal rail deliveries to RBCT are likely to be lower on the week, which will weigh on export availability. Producers have been holding back offers for July and August-loading cargoes, anticipating tightening availability.

Annual maintenance on the coal line is scheduled for 9-18 July, with stocks at Richards Bay continuing to come under pressure from disruption to rail deliveries. Today's closure will further limit deliveries to the port.

At the current rate of rail shipments and exports, stocks at RBCT will edge below 2mn t before the start of maintenance. In comparison, stocks at the port were built to 3.5mn t last year before TFR began the annual maintenance shutdown.

By Ashima Sharma