EBC Financial Group notes the recent transport data Exxaro shows why higher port capacity may not protect export margins if manganese continues to move by truck instead of rail, with 46% of Tshipi Borwa mine volumes still hauled by road
South Africa’s manganese exporters may lose margin before their ore reaches port if too much volume continues to move by truck instead of rail. Exxaro recently said road haulage costs 37% more than rail, while logistics account for 43% of free-on-board (FOB) export costs. FOB refers to the cost of moving cargo up to the point where it is loaded onto a vessel. This is important as Transnet Rail Infrastructure Manager said 11 private Train Operating Companies had concluded rail access agreements, with some operators targeting mainline entry before the end of 2026 and most expected to become operational during 2027. For manganese exporters, the priority is getting enough ore off trucks and onto rail to bring down inland transport costs.
David Precious, Senior Market Analyst at EBC Financial Group, said, “Higher port capacity may help South Africa load more manganese for export, but it may not protect margins if too much ore still travels by road from the Northern Cape. At Tshipi Borwa, a major manganese mine in the Kalahari Manganese Field, Exxaro’s data shows about 46% of volumes are still trucked, and road haulage costs 37% more than rail. That means exporters may give up value before the cargo reaches the port.”
Previously, EBC Financial Group (EBC) noted that the planned 16-million-tonne Ngqura manganese terminal in the Eastern Cape could strengthen South Africa’s export capacity, but its commercial value may depend on whether rail access improves enough to reduce road haulage. Exxaro’s latest transport data now adds a clearer cost dimension to that concern. This makes the issue less about port capacity alone and more about whether manganese exporters can lower the cost of moving ore from inland mines to coastal ports.
Inland Transport Remains the Margin Pressure
Tshipi Borwa exports about 3.5 million tonnes of manganese a year, with about 46% still hauled to ports by road, according to Exxaro’s June presentation. That means more than 1.5 million tonnes from one large mine still uses the higher-cost route before reaching export channels through Gqeberha and Saldanha.
A new port terminal may raise loading capacity, but it does not automatically lower transport costs because the ore still has to travel hundreds of kilometres from inland mining areas to coastal ports. If a large share of that journey remains on trucks, exporters may face tighter mine margins, less competitive delivered pricing, and higher exposure to fuel costs, truck availability, road congestion, and delays around port areas.
The issue is commercially important as Exxaro recently entered manganese at scale through Tshipi Borwa, a major mine in South Africa’s Kalahari Manganese Field. If almost half of the mine’s export volumes still move by road, transport costs may directly affect the value Exxaro can draw from the asset. This makes rail access important not only for South Africa’s export system, but also for Exxaro’s ability to protect margins in its manganese business.
Rail Delivery may Decide How Much Cost Pressure Eases
Rail reform may now be measured through operating data rather than policy announcements alone. The 11 private train operators are expected to add 24 million tonnes of freight capacity across coal, manganese, containers, fuel, and general freight, while the broader private-access process covers 41 routes across six corridors. Train slots are scheduled rights to run freight services on defined rail routes. For manganese, those slots may only improve competitiveness if they become operating trains, reduce the ore volume moved by road, and connect with ports that are ready to receive and unload higher rail volumes.
“Manganese exporters may benefit if private rail access leads to more train movements, lower road use, and smoother delivery into port. The benefit may appear in margins, reliability, and export competitiveness.” Precious added, “If rail delivery is slow, South Africa may still export volume, but at a higher inland cost than necessary.”
Tshipi Borwa’s rail share, private train operator start dates, rail slot delivery, port offloading readiness, and whether manganese exporters reduce trucking exposure during 2026 and 2027 may be the important indicators to watch. Together, they may show whether South Africa is improving the full export route from the Kalahari mine to the vessel or mainly adding port capacity while inland costs remain under pressure.
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Source: EBC.
Photo credit: EBC.
