Namibia’s transport and logistics industry is severely affected by the significant drop in the uranium spot price worldwide, which is currently trading at U$25.80 per pound, The Villager can reveal.
The Chief Executive Officer of Namibia Ports Authority (Namport), Bisey Uirab, told The Villager that the challenges gripping the uranium sector currently have affected their income but remained optimistic that better days are ahead.
Uranium, being one of Namibia’s biggest export commodities, has been trading on a downward trend since November 2015, trading at U$35.93 per pound a decrease from the U$36.96 per pound in October 2015, showing a decrease of -2.79%.
Uirab added that the trend at which uranium is trading is worrisome as the logistics and transports industry feels the pinch.
“Generally, the volumes of export commodities that go through our ports have declined significantly due to the huge decline in commodity prices. The Angolan economy is also not doing so well therefore the trade we had with them declined significantly. One can see the effect that this has on Oshikango, and all of us who are in the value chain are feeling the decline,” Uirab said.
The uranium spot price continued to drop as from U$35.10 in December 2015, a decrease of -2.31%, January 2016 34.62 (-1.37%), February 2016 33.62 by -2.89%, March 2016 29.61 a decline of -11.93%, April 2016 27.59 a decline of -6.82%. However in May 2016, there has been a slight increase up to U$27.79 showing an increase of 0.72%, but in June 2016 the price dropped again to U$27.15 with a decrease of -2.30%. Namibia exports mostly diamonds, uranium, lead, zinc, tin, silver, tungsten, food and live animals and manufactured products.
The decrease in commodity prices is worrisome especially since the Namibia Statistics Agency recently revealed that the country exported most commodities by sea and air, while lesser amount of commodities are exported via road. Sea transportation accounted for the bulk of exports at 53.7% during the first quarter of 2016. Despite the pressure arising, Namport, however remains optimistic.
“It is very worrisome, especially knowing that Namibia is a mineral exporting country. However, for us it is part of normal cyclical experience and we are very optimistic that sooner or later there the prices will pick up and we are gearing up to be ready for any sudden change in the commodity prices,” Uirab said.
Uranium production in Namibia stood at an estimated 3 713 metric tonnes output in 2015, however, in 2017 it is expected to be around 11 100 metric tonnes. Namibia is one of the biggest uranium producers in the world after Kazakhstan, Canada, Australia and Niger. Figures from the Bank of Namibia showed that uranium production contracted during both 2014 and 2015, whereas gold production rose significantly over the same period. The Bank of Namibia expects uranium production to expand by 62.9% in 2016 and by 89.5% in 2017.
Similarly, overall exports revenue grew by 32 percent to N$17.862 billion from N$13.616 billion recorded a year ago as foreign demand for diamonds, copper ore, fish and copper cathodes improved. Additionally, re-exports of vessels has also increased the overall exports.
Walvis Bay provides an easier and much faster transit route between Southern Africa, Europe and the Americas, while the Port of Lüderitz, located on the southern coast of Namibia, caters for Southern Namibia as well as providing access to markets in the Northern Cape of South Africa. Namport also manages a syncrolift (dry dock facility) where vessels of up to 2 000 tonnes can be lifted for repairs. Namport operates two floating docks with lifting capacity of 8 000 tonnes each.