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Presentation for WTCR 2012
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1 : Commodities transport demand
Workshop in Lilongwe,
29th of July 2010, Capital Hotel Lilongwe
Malawi Transport Sector Multimodal Development and Potential PPP Study
8/6/2010 1
REPUBLIC OF MALAWI
Ministry of Transport and
Public Infrastructure
SafegeConsultants for the European Union and the World Ba nkMinistry of Transport and Infrastructure
Agriculture in Malawi
• Contributes over 35% to national GDP,
• Employs over 80% of the labor force
• Contributes over 80% of the export earnings
8/6/2010 2
About Tobacco
• Most valuable production in Malawi (230 000 tons in 2009, 2/3 of exports in value)
• actual logistics
Fertilizers Green
leaves
Collection
of bales
Auction floors
Lilongwe (50%)
Limbe
Mzuzu
Satellite depot
Secondary auction floors
Warehousing of wet
Tobacco in railway stations
Intermediate buyers to
collect, group and sell
Factories (Processing)
Lilongwe or LimbeFumigationcontainerization
Break Bulk to JoburgWhere it is fumigatedand sealed in containers for Durban
Nacala
Beira
DurbanExport
(June to november)8/6/2010 3
$1.75/kg $
PACKING MODE : BALES
232 140 TONS 279 TONS
MODE ROUTES WEIGHT % ORIGIN DESTINATION GROUPING PT TIME (days) COST $/TON $/T/Km
Road to fob Sea freight
Road & Sea BEIRA 162498,70 70% Central Region Germany Road to fob Sea freight
Containerised DURBAN 69641,30 30% Kasungu,Dowa Poland Beira Route 35 US$79/t/km US$70/t/km
Lilongwe, The USA 35 US$79/t/km US$85/t/km
Dedza Belgium 50 US$79/t/km US$107/t/km
Mchinji The Netherlands Durban Route 35 US$120/t/km US$72/t/km
Northern Region Russia 35 US$120/t/km US$72/t/km
Rumphi, Spain 45 US$120/t/km US$80/t/km
Mzimba Egypt 30 US$120/t/km US$75/t/km
Southern Region Turkey 25 US$120/t/km US$70/t/km
Mangochi Austria 30 US$120/t/km US$75/t/km
Liwonde 40 US$120/t/km US$120/t/km
PACKING MODE CONTAINERS
40' high cube containers
232 140 TONS 279 TONS
MODE CORRIDOR WEIGHT % ORIGIN DESTINATION GROUPING PT TIME (days) COST $/TON $/T/Km
Road to fob Sea freight
Road & Sea BEIRA 162498,70 70% Central Region Germany Beira Route 35 US$79/t/km US$70/t/km
Containerised DURBAN 69641,30 30% Kasungu,Dowa Poland 35 US$79/t/km US$85/t/km
Lilongwe, The USA 50 US$79/t/km US$107/t/km
Dedza Belgium Durban Route 35 US$120/t/km US$72/t/km
Mchinji The Netherlands 35 US$120/t/km US$72/t/km
Northern Region Russia 45 US$120/t/km US$80/t/km
Rumphi, Spain 30 US$120/t/km US$75/t/km
Mzimba Egypt 25 US$120/t/km US$70/t/km
Southern Region Turkey 30 US$120/t/km US$75/t/km
Mangochi Austria 40 US$120/t/km US$120/t/km
Liwonde
NOTES: Malawi is 60% dependent on tobacco exports for its non aid foreign earnings.
The expected growth rate for 2020 is not that great due to Anti Smoking lobby in Western markets.
Malawi has diversified into other major cash crops such as Sugar,Tea,Cotton, Coffe and pulses
The discovery of Uranium in Karonga at Kayerekera will also boost the economy. Mining already
in progress and exports comenced in December 2009
INTERNATIONAL PART
RECENT EXPORTS EXPECTED EXPORTS 2020
PRODUCT : TOBACCO
SPECIAL CONDITIONS : PERISHABLE
LOCAL PRICE INTERNATIONAL PRICE
NATIONAL PART
RECENT PRODUCTION EXPECTED PRODUCTION 2020
8/6/2010 4
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
162,000n ton (70%)s
Germany, Poland, USA, Belgium,
Russiia, Spain, Egypt, Turkey
Tobacco exports in 2009
232 000 tons
69,641 tons(30%)
Liwonde
Mangochi
Rumpi
Mzimba
Germany, Poland, USA, Belgium,
Russiia, Spain, Egypt, Turkey
8/6/2010 5
Criteria of choice of an export transport chain
for Tobacco
Criteria for
exports
Processing and
packaging
Conditions
At Port
Time of
arrival
Pricing
of land
leg
Long
Term
contracts
Current Choice
of corridor
Exports
Tobacco
(1st Logistic
Chain)
Green leaves in Bulk
Fumigation at Joburg
then sent to Durban
Good
storage
and
handling
facilities
Very
important
Less
that sea
leg
X Road to Joburg
Tobacco
(2nd logistic
Chain)
Fumigation at the
factory Limbe or
Lilongwe
In 1000 kg sacs then
containerised
Idem Very
important
X Road to Beira
Nacala rail
corridor
Use of Nacala Rail
Corridor
Use of railway from
Auction Floor to factories
Conditions of a
possible transfer to
Nacala’s corridor
(in 2015)
Railway in good conditions
between Lilongwe and Nkaya
8/6/2010 6
NacalaChipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
(70%)
Germany, Poland, USA, Belgium,
Russiia, Spain, Egypt, Turkey
Tobacco exports in 2020
279 000 tons : Possible scheme
Liwonde
Mangochi
Rumpi
Mzimba
Germany, Poland, USA, Belgium,
Russiia, Spain, Egypt, Turkey
(30%)
?? Use of Nacala Rail
Corridor
Use of railway from
Auction Floor to factories
Railway in good conditions
between Lilongwe and Nkaya
Conditions
8/6/2010 7
About Tea and coffee• 2nd major cash earner for Malawi, after tobacco and registered tremendouth growth
• Good production necessitates good rains
• Very small volume (52600 tons in 2009 and expected 60000 tons in 2010)
• Localized in Tylolo and Mulanje area (East of Blantyre) and around Nkata Bay
• Actual logistics
Leaves collection Treatment in Blantyre
Processing and packing
in paper sacks
Trucks
Blantyre
plant70% Durban (fumigation in Joburg)
10% Mombasa
10% Johannesbourg (regional market)
Criteria for
exports/imports
Processing and
packaging
Conditions
At Port
Time of
arrival
Pricing of
land leg
Long Term
contracts
Choice of the
corridor
Tea Packed in paper sacks
then containerized
Good
storage
Very
sensitive
Not
important
? Not transfer to rail
to be expected
8/6/2010 8
$ US$254.09/kg
PACKING MODE : Containerised
packed in paper sacks
52 559 TONS 68 330 TONS
MODE ROUTES WEIGHT % ORIGIN DESTINATIONGROUPING PTTIME (days) COST $/TON$/T/Km
Road Mulanje Tholo Southern Region
to Blantye Tylolo, Mulanje
Road Nkhata Bay Northern Region
to Blantye Nkhata Bay
PACKING MODE CONTAINERS
52 559 TONS 68 330 TONS
MODE CORRIDOR WEIGHT % ORIGIN DESTINATIONGROUPING PTTIME (days) COST $/TON$/T/Km
Transit Time Road freight to ports Sea freight to destination
Rail Nacala 0% US$36
Road Beira 5255,9 10% 70% The Uk US$79 US$75.4
30% South Asia US$79 US$98
Road Durban 36791,3 70% 54% The Uk US$126.9 US$75.4
46% USA US$79 US$107
Road Johannesburg 5255,9 10% South Africa US$93 0
Road Beira Holland US$79 US$72
Mombasa 5255,9 10% Kenya US$160.7
NOTES: Tea is the second major cash earner for Malawi to tobacco and has registered tremendous growth.
70% of tea goes via Durban port, 10% via Mombasa port ,10% via Beira and 10% is sold to Johannesburg in Republic of South Africa.
Major buyers of tea in order of merit as per 2008 statistics are as follows: UK, RSA,Kenya,USA,Pakistan,Holland, Botswana and Canada
2010 crop is projected at 60000 metric tonnes due to good rains. The Chperoni rains will have an impact as well.
RECENT EXPORTS EXPECTED EXPORTS 2020
INTERNATIONAL PART
PRODUCT : TEA
SPECIAL CONDITIONS : SUBJECT TO INFECTION
INTERNATIONAL PRICE
RECENT PRODUCTION EXPECTED PRODUCTION 2020
LOCAL PRICE
NATIONAL PART
8/6/2010 9
Nacala
Chipata
Dar Es Salam
Mbeya
Tyolo
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
5255 tons (10%)
UK (70%), South-Asia, Holland
Tea Exports 52559 tons in 2009
36,791 tons (70%)
Nkahta Bay
Tyolo
36,791 tons (70%)
Mulanje
Nkhata Bay
UK (54%), South Asia (46%)South Africa
Kenya
5255 tons (10%)
8/6/2010 10
Location of production
About Sugar• One of the major production in Malawi in volume (350000 tons in 2009)
corresponding to 3.5 million tons of sugar cane.
• 2nd major export in volume (280 000 tons of sugar in 2009)
• 3rd cash earner for Malawi
• Actual and expected logistics
Nkhotakota
(Central Province
Nchalo
(Chiwawa District
Transport by dedicated lorries of raw cane
. 6 km from the mill: MK 450 per ton
. 40 km from the mill : MK 1000
Dwanga Sugar
Mills
Nchalo Sugar
Mills
Local Markets : Central and Northern Regions
Exports : Zambia, Tanzania, Rwanda, RDC
Trucks
47 km
Truck
Luchenza
Warehouse
Containers
16,8 to 20%
of total cost954 km
TrainNacala
197 km
954 km
TrainNacala
Train
Improvement : dedicated railway line to allow
cheeper transport of raw cane
Improvement : Replacement of the Chimoro bridge
and rehabilitation of the railway between Limbe and Bangula
8/6/2010 11
Nchalo Sugarfactory and estate
Road withescarpment
Road to Bangulastation
Railway from ChiromoTo Luchenza, Limbe, Nacala
Chiromo bridge to rebuild
Bangula – Nsanje abandoned railBangula
warehouses
Luchenzawarehouses
Road to BeiraRail to Nacala
Distance between the railwaysAprox. 50km
Nsanje linked by road only
How to better capture possible improvements
Dedicated railway line to allow
a cheeper transport of raw cane
Replacement of the Chimoro bridge and
rehabilitation of the railway between Limbe
and Bangula
Southern regionTransportation problems
For Sugar
8/6/2010 12
DwangaSugar
factory and estate
Road to the lake in a swamp
Railway to Nacala and Lilongwe-Zambia in Chipoka
Poor embankment, out of the estate
Poor lake service, no Ro-Ro
Northern regionTransportation problems
For Sugar
8/6/2010 13
$ $
PACKING MODE : C0NTAINERISED
packed in 1000kg bags
280000 TONS 364000 TONS
MODE ROUTES WEIGHT % ORIGIN DESTINATION GROUPING PTTIME (days) COST $/TON $/T/Km
Road Nchalo in Chikwawa Southern Region
to Blantye Nchalo in Chikwawa
Road Dwangwa Northern Region
to Blantye Dwangwa in Nkhota kota
PACKING MODE CONTAINERS
packed in 1000kg bags
280000 TONS 364000 TONS
MODE CORRIDOR WEIGHT % ORIGIN DESTINATION GROUPING PTTIME (days) COST $/TON $/T/Km
Transit Time ( days) Road freight to ports Sea freight to destination
Rail Nacala 140000 Mt 50% Chikwawa 50% EU 35 US$36 US$80
(South Mw) 40% USA 50 US$36 US$107Dwangwa (C/Mw) 10% Far East 45 US$36 US$98
Road Beira 126000 Mt 45% Chikwawa 50% EU 35 US$79 US$80
(South Mw) 40% USA 50 US$79 US$107Dwangwa (C/Mw) 10% Far East 45 US$79 US$98
Road Other 14000 Mt 5% Chikwawa 3% DR Congo 12 US$126.9 US$170
(South Mw) 1% Egypt 30 US$79 US$70
Dwangwa (C/Mw) 2% local 1 US$79 US$107
NOTES: Sugar is the THIRD major cash earner for Malawi and has registered tremendous growth.
EU ans The US increased the quota for Malawi sugar as one way of promoting trade with the third word countries such as Malawi.
This is an indirect way of providing aid to the developing countries. The quota and demand for Malawi sugar has increased substantially.
By 2010, we anticipate the sugar production figures to hit record 364000 metric tonnes. It is a furute growth area for the Malawi economy.
INTERNATIONAL PART
RECENT EXPORTS EXPECTED EXPORTS 2020
PRODUCT : SUGAR
SPECIAL CONDITIONS : NONE
LOCAL PRICE INTERNATIONAL PRICE
NATIONAL PART
RECENT PRODUCTION EXPECTED PRODUCTION 2020
8/6/2010 14
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
126000 t (45%)
Dwenga
140000 t (50%)
EU (50%), USA (40%) Far East (10%)
EU (50%), USA (40%)
Far East (10%)
Sugar exports (actual)
12000 t (5%)
Dwenga
Chiwawa
8/6/2010 15
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona Dwenga
364, 000 t (50%)
EU (50%), USA (40%) Far East (10%)
Expected Sugar exports in 2012-2015
Use of Lake service and Nacala Corridor
Dwanga
Chiwawa
New containers boats or barges
Lake service in use
Replacement of Chiromo bridge
railway rehabilitation between
Bangula and Limbe
Conditions
8/6/2010 16
About Cotton and Garnments• Cotton is grown up in the same places than sugar (along the Shire River) and around Salima
• Cotton production may be extended through the green belt program and the development
of Chikwawa Region
• Low density => the road transportation is competitive
• Major challenge due to a sharp fall of prices in 2008/2009 season (minimum price set up by
GOM of 60 MKw/kg but traders were buying 25 MKw/kg
Cotton collection
Trucks
40% Beira
60% Durban
..% Johannesbourg)
Treatment
Far East (China)
South East Asia
Criteria for
exports/imports
Processing and
packaging
Conditions
At Port
Time of
arrival
Pricing of
land leg
Long
Term
contracts
Choice of the
corridor
Cotton Bagged in hessian sacks
of 120kg each
Good
storage
Not
sensitive
Important Not an easy market
for rail
8/6/2010 17
0.33/KG $ $
PACKING MODE : CONTAINERISED
Bagged in hessian sacks of 120kg each
27 560 TONS 38 580 TONS
MODE ROUTES WEIGHT % ORIGIN DESTINATION GROUPING PT TIME (days) COST $/TON $/T/Km
Road Chikwawa Southern Region
to Blantye Chikwawa & Balaka
Road Balaka,Salima Central Region
to Blantye Salima & Ntcheu
PACKING MODE CONTAINERISED
Bagged in hessian sacks of 120kg each
27 560 TONS 38 580 TONS
MODE CORRIDOR WEIGHT % ORIGIN DESTINATION GROUPING PT TIME (days) COST $/t/km Cost$/t/km
Transit Time
Road Beira 11024 40% 70% Far East ( China) 50 US$79 US$98
30% South Asia 45 US$79 US$92
Road Durban 16536 60% 54% Far East ( China) 50 US$126.9 US$98
46% South Asia 45 US$126.9 US$92
Road Johannesburg 0% 0% South Africa N/A US$93 0
NOTES: Cotton is another key export commodity for Malawi.The crop has faced a major challenge recently due to sharp fall of prices in
in 2008/09 season. The government set a minimum price of 60Mw Kwacha per kg BUT the traders were buying at 25 Mw
kwacha per kg. This discouraged the farmers and coupled with dry spell the crop production for 2010/11 season has fallen by 50%.
The World Bank and Cotton Development Trust have come in and planned to increase production for the future. Price at 50Mk/ kg
for 2010/11 season equivalent to 30 US cents per kilogram.
INTERNATIONAL PART
RECENT EXPORTS EXPECTED EXPORTS 2020
PRODUCT : COTTON
SPECIAL CONDITIONS : NONE
LOCAL PRICE INTERNATIONAL PRICE
NATIONAL PART
RECENT PRODUCTION EXPECTED PRODUCTION 2020
8/6/2010 18
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona Dwenga
11,024 t (40%)
Far East (70%), South Asia (30%)
Cotton exports in 2009
Use of Roads to Beira and Durban
Dwenga
Chiwawa
Far East (64%), South Asia (46%)
16,536 t (60%)
8/6/2010 19
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona Dwenga
38,580 t (40%)
Far East (70%), South Asia (30%)
Dwenga
Chiwawa
38,580 t (40%)
?
Cotton exports in 2020
Use of train to Nacala
Or intermodal
to Nsanje, Chinde,
Beira ?
8/6/2010 20
About Maize• Second most important commodity produced by Malawi, in terms of tonnage and first in
strategic importance (daily food of all Malawians)
• 3 to 3.5 million tons per year … with huge silos around Lilongwe and major cities
(impossible human consumption : 365x 16000000x 2x 0,2 kg = 2.336 million tons per year
…. Even babies in this hypotesis are eating their 0,2 kg portions 3 times per day !!)
• Malawi could be a major regional exporter (Eastern, East-Central Africa, Kenya, Zimbabwe)
• Road = unique transportation mode for bulk maize (traditional means)
• Road = unique transportation mode for processed maize
Possibilities
Criteria for
regional
distribution
Processing
and packaging
Points of
processing
Time of
arrival
Price of
transport
Choice of the corridor
Within Malawi In sacs ,
limited exports
Blantyre silos
Eastwards and
Southwards
Not very
important
Very sensitive Distribution around the lake
to Northern cities and to
Monkey Bay
Reginal exports In sacs ,
limited exports
idem Not very
sensitive
Very sensitive Use of railways (to Zambia,
Tanzania, Mozambique, …)
8/6/2010 21
About MaizeTrends in domestic gaps
In February 2008, the price of maize had more than doubled from
MWK21 per kg in the previous year (Feb 2007) to MWK43 per kg.
From January 2008 to March 2008, the price had increased by 10%,
with March representing the peak of the lean season.
The maize harvest period which started in March in some parts of
the country did not result in the weakening of the prices, as expected.
As such, maize prices have kept on an upward trend, currently reaching
over MWK60 per kg. The high volatility of prices between the harvest
(March – June) and lean season (October – February) is typical of thin
Maize markets. Farmers are compelled to engage in distress selling at
low prices during the harvest period, only to buy back the maize during
the lean season at much higher prices. Over 80% of the smallholder
farmers end up being net food buyers.
8/6/2010 22
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
Maize local distribution
Use of the lake and railway distribution
systems
8/6/2010 23
About Cassava
Push factors to grow cassava. 2002 drought. Withdraw of input subsidy,. Reduced urban purchasing power and dwindling farm sizes. Pull factors. Relative ease of cassava cultivation, . Utility of ‘sweet’ cassava as an uncooked snack food, . Lower price of the raw roots in urban markets compared to
maize
8/6/2010 24
Alternative Supply Channels in Malawi’sCassava Value Chain
The total cassava production figure is based on the 2007 crop estimate from the Ministryof Agriculture of 3,194,994 tons. Out of the total 26,6% is sold of which 80% as fresh cassava
8/6/2010 25
Transportation of Cassava• From the producing areas to the markets : Land rovers (especially in
Lilongwe) and lorries (3, 7 to 10 tons) - return trips from original trips/places.• A majority of the traders arrange their own transport. • In some cases, especially for smaller markets, a number of wholesalers will
hire one vehicle to transport their produce to a given market.• Sacs (50 or 90 kg) or bulk in the vehicle. • For areas within the vicinity (20-30 kilometers from the city), bicycles are
used to transport cassava. These can transport cassava of up to a 50 kilograms bag.
8/6/2010 26
Chipoka
Salima
Nacala
Chipata
Dar Es SalamMbeya
Bangula
Beira
MoatizeLuzaka
ChindeTete
Route for Cassava and sweet potatoe
mainproduction
area
efficient lakeservices allow
marketing
8/6/2010 27
Chipoka
Salima
Nacala
Chipata
Dar Es SalamMbeya
Bangula
Beira
MoatizeLuzaka
ChindeTete
RICE ALTERNATIVE CORRIDORS
MonkeyBay
Lower
Shire
8/6/2010 28
About Fertilizers• Importation of 369,000 tons of fertilizers in 2008,
• Essential to the development of Malawi’ s agricultural sector
• Most of fertilizer is imported as a finished product but some importers have blending plants
• Imports from South Africa (Joburg), through Beira, Dar Es Salaam (Farmers World)
• Improvements to reduce the cost of imports for the farmers :
– Buy fertilizers in bulk ...with bulk handling on railway as it is cheaper and bagging in Malawi is not
expensive but time consuming
– Obtain a more balanced flow of goods (buffer stock in advance of the season and planning fertilizer
subsidy program in advance to get better prices.
Process and logistics Blending company Regional depots Distribution
Farmers World Liwonde From Liwonde
Optichem (production side) Blantyre Blantyre and Lilongwe From Blantyre and Lilongwe
Yara Traders and agents are selling fertilizers
to farmers
8/6/2010 29
IM P O R T S S T A T IS T I C S
$ 50 k g b a g $
P A C K IN G M O D E B A G S o r C O N T A IN E R S
5 0 k i l o g ra m b a g s
3 6 9 0 0 0 T O N S T ra n s p o rt e d b / b u l k 3 6 9 0 0 0 T O N S
M O D E C O R R ID O R W E IG H T % D E S T IN A T IO N O R IG IN G R O U P IN G P T T IM E (d a y s ) C O S T $ /T O N $ /T /K m
T ra n s i t T i m e F o b B e i ra / L L S e a f re i g h t
R o a d & S e a B E IR A 2 9 5 2 0 0 ,0 0 8 0 % T o L i lo n g w e In d ia /C h in a F O B B e i ra - L L 3 5 U S $ 9 2 / t/ k m U S $ 8 0 / t / k m
C o n t a in e r is e d D a r e s s a la a m 7 3 8 0 0 ,0 0 2 0 % T o B la n ty re U A E & S a u d i / A ra b ia F O B B e i ra - B t 3 5 U S $ 8 5 / t / k m U S $ 6 5 t / k m
F O B D a r - L L 3 0 U S $ 1 2 0 / t / k m U S $ 6 5 t / k m
P A C K IN G M O D E : B A G S
T O N S T O N S
M O D E R O U T E S W E IG H T % O R IG IN D E S T IN A T IO N G R O U P IN G P T T IM E (d a y s ) C O S T $ /T O N $ /T /K m
R E C E N T C O N S U M P T IO N E X P E C T E D C O N S U M P T IO N 2 02 0
P R O D U C T : F E R T IL IZE R S
S P E C IA L C O N D IT IO N S : N O N E
L O C A L P R IC E IN T E R N A T IO N A L P R IC E
IN T E R N A T I O N A L P A R T
R E C E N T IM P O R T S E X P E C T E D IM P O R T S 20 20
N A T IO N A L P A R T
8/6/2010 30
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
Imports of Fertilizers in 2009
Possibilities in the future (1) and (2)
295200 tons (80%)
73 800 tons (20%)
1
2
(2) Barges on the Shire Zambezi
river
(1) Rehabilitation of the Nacala
Corridor and links to Lilongwe
Conditions
8/6/2010 31
Nacala
Chipata
Dar Es Salam
Mbeya
Bangula
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
Harare
SalimaChipoka
Nsanje Port
DurbanJoburg
Kanona
Route for Heavy Sands inputs and outputs
necessarypower from
coal
8/6/2010 32
About Clinker• Portland previously mined limestone and manufactured Clinker at Changulume ; this clinker
was ultimately transported by rail to a Cement factory in Blantyre (coal necessary)
• In 2009, importation of 202,000 tons from India/China through Beira (40%) and Nacala
(60%)
• In the years to come, imports (Lafarge) from Zambia (50%) and Zimbabwe (50%)
• Cement industry highly dependant on the transport sector
Opportunities for Malawi
• Reducing the cost of imports including transport cost by producing cement (limestone +
coal => Clinker main raw material for Cement)
• Develop an efficient North-South transportation system for heavy products, including Lake
intermodal facilities and efficient railway
8/6/2010 33
The cement production process
1) Limestone is taken from a quarry. It is the major ingredient needed for making cement. Smaller quant ities of sand and clay are also needed. Limestone, sand and clay contain the four essential elements required to make cement. The four essential elements are calcium, s ilicon, aluminum and iron.
2) Boulder-size limestone rocks are transported from the quarry to the cement plant and fed into a crusher which crushes the boulders into marble-size pieces.
3) The limestone pieces then go through a blender where they are added to the other raw materials in the right proportion.
4) The raw materials are ground to a powder. This is sometimes done w ith rollers that crush the materials against a rotating platform.
5) Everything then goes into a huge, extreme ly hot, rotating furnace to undergo a process called "sintering". Sintering means: to cause to become a coherent mass by heat ing without melting. In other words, the raw materials become sort of partia lly molten. The raw materials reach about 2700° F (1480°C) ins ide the furnace. This causes chemical and physical changes to the raw materials and they come out of the furnace as large, glassy,
hot cinders called "clinker".
6) The clinker is cooled and ground into a fine gray powder. A small amount of gypsum is also added during the final gr inding. It is now the finished product - Portland cement. The cement is then stored in silos (large holding tanks) where it awaits distribution. The cement is usually shipped in bulk in purpose-made trucks, by rail or even by barge or ship. Some is bagged for those who want small quantities.
How to produce
Clinker
8/6/2010 34
About Mining
• Mining in Malawi (Uranium, Rare Earth, Heavy Sands, Bauxite)
• Coal of Tete Region (Moatize Mine with Vale, Riverdale Mine)
• Copper from Zambia
8/6/2010 35
Global SchemeMakanjira
Mulanje
Alumine to Cabora Basso
Chimwazulu MineLake Chiwa
KeyelekeraUranium Mine
KasunguLimestone
Salima and ChipokaHeavy minerals
Kangankunde Hill monazite
Mochuchuma-KatewakaCoal Field
Al
Ti
Kanyika mobdiumuranium mine
Mzuzu
Lilongwe
Electricityand coal
Coal from Moatize to Nacala
70 km
120 km
Substitution of Sulfur
Nsanje Port (Molasses, fertilizers)
Ni
Sugar
Sugar
N
N
52 km
8/6/2010 36
$ $
PACKING MODE : CONTAINERISED
(In Drums of 333kg's each)
500 TONS 10000/ yr TONS
MODE ROUTES WEIGHT % ORIGIN DESTINATION GROUPING PT TIME (days) COST $/TON $/T/Km
Road Kayelekera Nothern Rgn
in Karonga Karonga
0%
PACKING MODE CONTAINERS
(In Drums of 333kg's each)
500 TONS 10000/ yr TONS
MODE CORRIDOR WEIGHT % ORIGIN DESTINATION GROUPING PT TIME (days) COST $/TON
Transit time Road freight to port Sea freight
Road Walvis Bay in 100% Kayelekera 100% CANADA 50 US$1179/TON US$107
NAMIBIA Karonga
NOTES: The discovery of Uranium at Kayelekera in Karonga, the Nothern part of Malawi, is a massive breakthrough
in the economy of Malawi. The country is already earning over 300 million kwacha in loyalties. There is a lucrative market in Canada
and the mine has got a life of aver 15 years. Paladin Africa have already exported 27x20' containers since the commissioning of the mine.
More uranium has been discovered at Kanyika and Globe Metals are on Bankable Feasibility study stage and mining is expected to
commence in 2012/13 season.
RECENT EXPORTS EXPECTED EXPORTS 2020
PRODUCT : URANIUM
SPECIAL CONDITIONS : SUBJECT TO INFECTION
LOCAL PRICE
NATIONAL PART
RECENT PRODUCTION
INTERNATIONAL PART
INTERNATIONAL PRICE
EXPECTED PRODUCTION 2020
8/6/2010 37
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
Kayelkera
Expected Uranium exports in 2020By trucks to Walwis Bay (Containerised in drums of
333 kg’s each)
Kayelekera
In Karonga
10,000 t/year
8/6/2010 38
Chipoka
Salima
Nacala
Chipata
Dar Es SalamMbeya
Bangula
Beira
MoatizeLuzaka
ChindeTete
Route for Aluminium Ore inputs and outputs
chemicals
coal
aluminum
8/6/2010 39
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
Expected Coal exports from Moatize
mine in 2020
Moatize’s 2,440 million tonnes of estimated reserves
Phase 1 : 2011-2015
. 12.7 million tonnes (mt) annually of hard coking coal for export;
. 2.4mt/year of export thermal coal,
. 2.5mt/year of thermal coal to supply a local power station should one be built.
“We estimate the rehabilitated line will be able to transport between 6mt and 8mt of coal annually
which is clearly not enough for our requirements and there are other potential coal producers in
the Moatize region”.
Phase 2 : after 2015
. 21 million tonnes per annum, run-of-mine, which implies a 1,500 MW mine-mouth power plant
2015 :6 to 8 million tons
2015 : 3 up to 6 million tons
Possibility : barging the coal 400km down the Zambezi from Tete
to the coast, from where it would be barged out to sea and loaded
on to vessels anchored offshore.
Riversdale expects to produce 20-million tons of coking coal from Mozambique by 2016.
20 millions export capacity
8/6/2010 40
Nacala
Chipata
Dar Es Salam
Mbeya
Chiwawa
Beira
MoatizeLuzaka
Chinde
Tete
Mtwara
HarareNsanje Port
DurbanJoburg
Kanona
Expected Copper exports from Copper
Belt in 2020
(From Gopa Study) As basis for the Railway Master Plan, only safeguarded traffic potentials have been considered, in other words amounts of
traffic that customers intend to transport. Accordingly, traffic on the Nacala Corridor will amount to 524,000 tonnes equivalent to 409 m
tonnekilometres per annum. With the start-up of the extension to Chipata (Zambia) in 2012, these figures are expected to increase to
962,000 tonnes and 890 m tonne-kilometres, and further to 1.45 m tonnes and 1,445 m tonne-kilometres in 2016.
8/6/2010 41
Chipoka
Salima
Nacala
Chipata
Dar Es SalamMbeya
Bangula
Beira
Moatize
Luzaka
ChindeTete
127, 000 t Cement
80,000 t Lime
28,000 t Fuel
General Cargo
Mtwara
Tobacco,
100,000 t Rice,
Sugar, Tea, Beans
and Metals
59,600 t Fertizers
9,6000 t Fuel
140,000 t Sugar
15,000 t Food Crops
Liwonde
Chilumba
Lilongwe
Blantyre
89,400 t Fertizers
153,000 Fuel
162,000 t tobacco
36,000 t Tea
11,000 t Cotton
126,000 t Sugar
Durban91,000 t exports
Actual traffic on corridors
8/6/2010 42
IMMEDIATE NEEDS Tea Tobacco Cotton Sugar Nuts
Quantities 2009 52.56 232.63 27.56 280.00 295.33
Existing mode Road Road Road Road or Rail Road+rail
Existing corridor Durban Beira Durban +
Beira
Beira or Nacala Tazara
Priorities for Transport
Improvement and
Investment
Tete Bridge efficient rail
services
Chiromo
Bridge
Chiromo
Bridge
Lake service in
Nkhata Bay
Border crossing rail link Limbe
- Lilongwe
Tete Bridge Dwanga road
to lake
MCC
equipment in
M'Beya
Border
Crossing
Dwanga port +
lake service
Border
Crossing
Cassava Potatoes Sweet
Potatoes
Maize Rice Pulses
Quantities 2009 3913.00 758.00 2714.00 3201.68 106.11 383.00
Existing mode None none none road road Road+rail
Priorities for Transport
Improvement and
Investment
Lake service
Nkhata Bay
Cheaper road
transport
Lake service
Nkhata Bay
warehousing Lake service MCC
equipment
rail link Limbe -
Chipoka-
Lilongwe –Chipata
rail link Limbe
- Chipoka-
Lilongwe -
Chipata
rail link
Limbe -
Chipoka-
Lilongwe -
Chipata
efficient rail
services
efficient rail
services
Ro-Ro service
on the lake
Equipments to
produce flour8/6/2010 43
Petrol Paraffin Diesel &
other
General
Petroleum
Fertilizer Imported
Coal
Quantities 2009 107.80 14.80 157.40 280.00 141.61 2.00
Existing mode Road Road Road Road Road Train
Existing corridor Beira Tazara Beira Beira Beira Beira
Priorities for Transport
Improvement and
Investment
77km in
Mozambique
Ro-Ro service on
the lake
lake Ro-Ro
service on the
lake
warehousing lake service Link with
Moatize
rail link Limbe -
Chipoka- Lilongwe
–Chipata
rail link Limbe -
Chipoka-
Lilongwe -
Chipata
rail link Limbe -
Chipoka-
Lilongwe -
Chipata
efficient rail
services
efficient rail
services
Services on
the lake
Ro-Ro service RoRo service
Lime Clinker Uranium Titanium ore Pig Iron Alumina
Quantities 2009 38.00 21.00 0.00 0.00 0.00 0.00
Existing mode Road Road + train Road none none none
Existing corridor
Tazara western
Western and
TAZARA none none none
Priorities for Transport
Improvement and
Investment
lake service Tete bridge MCC
equipment
Energy Energy Rail link to
Moatize
8/6/2010 44