Transnet targets 61M mt coal corridor throughput as maintenance execution lifts export recovery

South Africa's coal export corridor has moved beyond stabilization and is showing a sustained recovery, with state-owned logistics operator Transnet SOC Ltd. targeting 61 million mt of throughput in the 2026-27 financial year as improved maintenance execution, new rolling stock and 6.8 billion South African rand in funding sought from National Treasury for a network upgrade lift rail-delivered export volumes.

"The focus on 61 million mt for 2026-27 and 70 million mt for 2028-29 is fairly reliable because that is based on our existing plan," Dr. Andrew Shaw, Chief Strategy and Planning Officer at Transnet, said in an interview with Platts, part of S&P Global Energy, on July 22.

The target is central to South Africa's attempt to restore confidence in its coal export chain after years of underperformance marked by derailments, cable theft, locomotive shortages and network instability. Transnet sees Richards Bay Coal Terminal exporting around 57 million mt, while the rail operator remains "a little below that" in terms of its own delivery ability, Shaw said.

The recovery plan is aimed at narrowing the gap between RBCT's 91 million mt/year nameplate capacity and actual coal moved by rail to the terminal, a long-standing frustration for miners and traders exposed to South African thermal coal supply. Shaw emphasized that success would not be measured solely through volume growth but also through Transnet's ability to sustain a higher operating tempo, reduce operational disruptions and provide greater certainty and predictability for exporters.

Maintenance overhaul drives operational gains

At the heart of the plan is a change in how Transnet maintains the coal corridor. Shaw said the company has shifted from one major annual shutdown to two planned shutdowns a year, allowing it to carry out rehabilitation without removing too much train-running capacity from the system at once.

"We don't want to take significant periods of time out to rehabilitate the network because then we lose the ability to run trains, so there are two shuts as opposed to one," Shaw said.

Execution rates during these shutdowns have improved sharply under the Transnet Rail Infrastructure Manager, or TRIM, Shaw said. "We previously would achieve between 30% to 40% of our planned execution. Planned execution rates are now closer to 80% to 90% for shut execution from TRIM," he said.

That improvement has already contributed to an 11% rise in volumes over the past year, and Transnet is "fairly confident" it can sustain the trajectory toward 61 million mt in the current financial year, Shaw said.

The coal line upgrade is supported by 6.8 billion rand of Budget Facility for Infrastructure funding from South Africa's National Treasury, which followed an Independent Technical Assessment funded collectively by major coal customers, Shaw said. The program is expected to roll out over roughly three years and focuses on improving the existing corridor rather than changing the operating model immediately.

Rolling stock availability is also improving, with Transnet bringing locomotives back into service and continuing deliveries of 23E locomotives, Shaw said.

"Everything has to fit together," he said, referring to network maintenance, locomotive availability and wagon renewal.

Shaw added that while no single constraint determines corridor performance, reliable traction and overall network resilience remain the two most important drivers of export performance.

Market resilience meets shifting demand

For exporters, the operational recovery comes at a complicated point in the market cycle. Shaw noted that Transnet's planning assumptions are based on validated customer demand and logistics readiness rather than forecasts of international coal markets.

Platts-assessed FOB Richards Bay 5,500 kcal/kg NAR prices averaged $93.40/mt in June, down from $94.20/mt in May but above $92.05/mt in April, according to S&P Global Energy data.

South African coal exports to India, historically one of the key outlets for Richards Bay material, fell to 7.2 million mt in Q2 2026 from 9.1 million mt in Q1 and 8.8 million mt a year earlier, as Indian direct reduced iron producers increased their reliance on domestic coal and used South African coal more as a blending component.

That demand shift has limited the price impact of rail disruptions. After a June 9 suspension of coal train operations following a derailment near Richards Bay, market participants said South African thermal coal prices were unlikely to be significantly affected because Indian demand was weak and RBCT stocks were sufficient. Platts assessed FOB Richards Bay 5,500 kcal/kg NAR at $96/mt on June 9. Platts last assessed the grade at $88.95/mt July 29, up 45 cents/mt day over day.

Shaw, however, said Transnet's customers remain confident that incremental coal delivered through RBCT will find buyers if prices hold near levels that preserve miners' margins." As long as price holds at around $130/mt [for FOB Richards Bay 6,000 kcal/kg NAR coal], the market is very resilient for South African coal," he said. Platts does not assess the 6,000 kcal/kg NAR grade.

Transnet's immediate focus is therefore throughput rather than market redesign. The existing operating structure — Transnet Freight Rail as operator, TRIM as infrastructure provider and RBCT as terminal operator — will remain in place through 2026-27, Shaw said.

"Our challenge is really just to drive the throughput," Shaw said.

He added that Transnet's objective is to ensure that logistics remains an enabler of South Africa's export competitiveness rather than a constraint. "Our focus is just to continue to improve the volume throughput, ultimately to drive up to the 70 million mt mark, which we have a two-year target for."

Shaw described the 81 million mt per annum objective as a medium-term strategic ambition rather than a short-term target. Progress toward this objective would depend on the successful implementation of operational improvements, infrastructure investment programs, ongoing rail reform initiatives, and appropriately structured private-sector participation arrangements.

Private-sector participation remains a medium-term question rather than a near-term operational shift. Shaw said Transnet has committed to developing a business case by the end of 2027 to assess how the coal line could be taken to market, with any transaction likely to be handled through the Development Bank of Southern Africa's private-sector participation office.