• Court upholds ICTSI’s $640M Durban terminal concession deal
• DCT2 overhaul to boost capacity, fix chronic port congestion
• Project seen as key to reviving South Africa’s logistics sector
  

The KwaZulu-Natal High Court on Friday, October 10, dismissed an application by APM Terminals BV to overturn the concession of the Durban Container Terminal Pier 2 (DCT2) to International Container Terminal Services Inc. (ICTSI). ICTSI was awarded a 25-year operating contract by the state-owned port operator Transnet SOC Ltd. in exchange for an investment commitment of R11.1 billion (approximately $640 million).

The dispute centered on the solvency criteria applied during the tender process. Barring any further legal appeal, the court decision clears the way for the restart of a strategic project vital to South African logistics.

Key Project for Durban's Competitiveness

DCT2 is the largest container terminal in South Africa, handling 72% of the total throughput at the Port of Durban and 46% of the country’s container volumes. Despite its importance, the platform has faced chronic capacity and congestion challenges for years, which contributed to its ranking at the bottom of the World Bank's Container Port Performance Index (CPPI) published in September, placing it last among the 403 platforms studied.

With this verdict, Transnet and ICTSI should be able to launch the terminal modernization, which has been suspended since 2024. The five year work program aims to increase the terminal's capacity and operational performance. Detailed plans, outlined since 2023, include deepening berths 203, 204, and 205, as well as the turning basin and approach channel, from 12.8 meters to 16.5 meters.

This deepening will enable vessels with drafts exceeding 12.2 meters to access the port, improving Durban's flexibility and competitiveness against other African hubs like Tanger Med or Port Said. A second phase will extend the terminal’s berth length from 914 meters to 1,210 meters, providing sufficient capacity to accommodate three Super Post Panamax vessels, each 350 meters long with a 14.5-meter draft.

Boost for Transnet and National Economy

The stakes extend beyond the port itself. The modernization of DCT2 is expected to have a multiplier effect on the entire South African supply chain, helping reduce transport costs, streamline mineral and manufacturing exports, and restore investor confidence in Transnet’s execution capabilities.

Poor performance at ports coupled with faltering rail services has destabilized the country’s logistics network, with major repercussions across sectors like agriculture and mining. According to data from the Bureau for Food and Agricultural Policy (BFAP), the national citrus industry alone suffered an estimated loss of R5.27 billion during the 2024 season due to logistics inefficiency. Furthermore, Mpumi Zikalala, CEO of iron ore miner Kumba Iron Ore, revealed that the South African economy lost R140 billion in coal export revenue between 2021 and 2023 due to transportation bottlenecks.