Demand for project cargo services is expected to grow significantly in Africa in the short to medium term, driven by the continent’s vast mineral deposits essential for the global shift to low-carbon and digital technologies.
According to United Nations estimates, the continent holds 55% of the world’s cobalt, 47,65% of manganese, 21,6% of natural graphite, 5,9% of copper, 5,6% of nickel and 1% of lithium. Expansion of existing mines and opening new operations will need to be supported by project logistics. If the rhetoric around beneficiation is translated into action, then there will also be demand for processing equipment.
Another driver of demand for project logistics is investment in roads, rail, ports, airports, dams and power stations as well as wind and solar farms. The potential has attracted the attention of multinationals. Thomas Vestergaard, CEO of Denmark-based UPF Group, sums up the sentiment: “Africa is a growing market for a combination of reasons. It is not quite so exotic nowadays plus people are being forced to do something as Europe is declining”.
Recently, Blue Water Shipping opened offices in Walvis Bay and Cape Town due to increasing activities within the solar, wind, hydrogen, oil and gas and mining sectors. In a blog, Seamaster Maritime & Logistics describes the future of the project cargo supply chain in southern Africa as bright. “The region is experiencing rapid economic growth and is investing heavily in new infrastructure projects. This is creating new opportunities for project cargo supply chain companies.”
Agility Emerging Markets Logistics Index 2024 reports: “Africa has a young and rapidly growing population, forecast to reach 2.4 billion by 2050. Urbanisation of this population is driving demand for infrastructure including roads, ports, airports, digital infrastructure, power generation and water distribution”. The changing demographics are behind major projects such as the Trans-African highways projects that will link Algeria, Tunisia, Mali, Niger, Chad and Nigeria, according to the Agility Emerging Markets Logistics Index 2024.
In June 2023, the Tanzania National Roads Agency awarded contracts for the construction of seven new roads covering 2 035 kilometres. In addition, the French Development Agency is supporting construction of a power line in the gold mining region of Geita.
The Agility Emerging Markets Logistics Index 2024 highlights renewed global interest in Africa. “Indeed, there is plenty of evidence for increased engagement and investment commitments made by major global powers in Africa.”
Challenges that project logistics companies will have to overcome include infrastructure gaps, skills shortages and corruption.
