The Logistics Advantage: Why Grindrod Logistics’s Multimodal Strategy Matters for South Africa’s Economy

How Grindrod Logistics is Optimizing National Freight through Integrated Transport Solutions

South Africa’s Economy is Shifting — and Logistics Must Evolve with It

South Africa’s economy is experiencing a logistics inflection point. As the economy grows and becomes more complex, traditional logistics models (like over-reliance on road freight) are becoming inefficient, costly, and unsustainable. The logistics sector needs to shift and evolve to support the next phase of economic development.

With GDP growth expected to recover gradually post-2023 and simultaneously, government is putting infrastructure development and logistics modernization at the center of its policy plans (e.g., through the National Infrastructure Plan 2050, port reform, and private-sector participation in rail). These two forces — economic recovery and policy reform — are driving new expectations from the logistics sector.

Supply chains are under pressure to deliver more — faster, cheaper, and more sustainably. The country’s role as a trade and industrial hub for Southern Africa makes it reliant on efficient freight movement, particularly as transport and logistics costs remain among the highest in the world relative to GDP (over 11%). This statistic highlights a major national issue: South Africa spends more than 11% of its entire GDP on logistics costs, compared to a global average of about 8–9%. That includes fuel, labor, road maintenance, delays, and inefficiencies.

South Africa’s economy can't grow effectively unless it modernizes and optimizes its logistics systems. That’s where multimodal logistics comes in.

Multimodal transport — the use of two or more modes (road, rail, sea) within a single supply chain — is no longer a nice-to-have. It's becoming essential for ensuring goods can move reliably across long inland distances, reach ports, or circulate between cities without depending solely on one fragile mode.

At Grindrod Logistics, we’ve structured our operations around this exact need. While many logistics providers focus narrowly on one segment, our integrated model allows us to connect freight across road, rail, depots, terminals, and coastal feeder shipping — all within South Africa’s borders.

The Cost of Single-Mode Transport in South Africa

Historically, South Africa has been over-reliant on road freight, which currently handles over 80% of the country’s inland freight volume. While trucking offers flexibility, it comes at a high cost — both financially and environmentally. High diesel prices, road congestion, deteriorating infrastructure, and increasing regulation are pushing road-based logistics into a cost and reliability ceiling.

Moreover, road transport suffers from:
- Volatile fuel price exposure
- Overburdened highways (e.g. the N3 Durban-JHB corridor)
- Under-utilization of rail despite national capacity
- Rising carbon emissions and sustainability pressure

Multimodal transport offers the key to unlocking efficiency: combining road for flexibility, rail for bulk movement, and coastal shipping for inter-port transfers can reduce long-haul trucking pressure, improve cost efficiency, and enhance supply chain agility.

Grindrod Logistics’ Multimodal Role in the South African Economy

Road Freight
Grindrod Logistics operates a reliable and scalable national road freight network, offering first- and last-mile delivery, containerized transport, and inland cargo movement. This forms the backbone of our customer supply chains, particularly for industries like FMCG, mining, general distribution, and containerized imports.

Rail Logistics (Strategic Integration)
While we are not a rail operator ourselves, we actively design logistics solutions that integrate with South Africa’s rail corridors. Our depots and container yards serve as interface points where rail becomes part of a larger multimodal solution — ideal for cargo flowing between Johannesburg, Durban, and other long-haul routes.

Feeder Vessel Service
One of the most unique aspects of our service offering is our dedicated coastal feeder vessel operation, run in partnership with Maersk. This scheduled coastal route connects Durban, Port Elizabeth, and Cape Town. By adding this feeder layer, Grindrod Logistics has transformed from a pure inland player to a national connector, enhancing how goods move between South Africa’s major economic and port zones.

The Strategic Value of Multimodal in a South African Context

1. Boosting Export Capability
Multimodal design lowers total landed cost, especially for heavy, low-margin commodities.

2. Driving Down National Logistics Costs
With SA's logistics costs at 11.8% of GDP, using the most efficient mix of modes is key to productivity.

3. Supply Chain Resilience
Multimodal options allow rerouting during disruptions, helping maintain delivery schedules.

4. Carbon Reduction Goals
Shifting cargo from road to rail or vessel helps companies reduce Scope 3 emissions and meet sustainability goals.

Conclusion: Multimodal Isn’t the Future — It’s the Now

At Grindrod Logistics, we understand that South Africa’s logistics landscape is complex, cost-sensitive, and infrastructure-constrained. That’s why we’ve built an operation that doesn’t rely on one mode alone.

Our ability to seamlessly integrate road, depot, rail interfaces, and feeder vessel services allows us to deliver smarter, more resilient solutions for our clients — from Durban to Cape Town, Gauteng to the Eastern Cape, and every route in between.

In a growing economy, it’s not just about moving goods. It’s about connecting markets, managing risk, and optimizing every leg of the journey. And that’s exactly what Grindrod Logistics is here to do.

Sources & References

1. World Bank Logistics Performance Index 2023 – South Africa Country Report

2. South African National Infrastructure Plan 2050 – Department of Public Works and Infrastructure

3. Statistics South Africa – Freight Transport Reports (2022–2023)

4. Transnet National Rail Policy – Department of Transport, South Africa

5. Africa Transport Policy Program (SSATP) – Freight Efficiency Study 2023

6. OECD – Trade and Logistics Cost in Emerging Economies (2022)

7. African Continental Free Trade Area (AfCFTA) – Logistics Readiness Report

8. UNCTAD Review of Maritime Transport 2023 – Sub-Saharan Africa Focus