Transnet opens South Africa rail network to Grindrod, Minrail

South Africa’s state-owned logistics company, Transnet, has granted 11 private operators access to parts of its freight rail network, marking one of the country’s biggest rail reforms since the end of apartheid. 

The companies selected include Grindrod, Minrail, Railway Corporation, Menar and Barbary. All were part of a shortlist announced by the government in August. 

The move is aimed at easing long-running transport bottlenecks that have weighed on South Africa’s economy, slowed exports and disrupted supply chains across mining, manufacturing and agriculture. 

“The conclusion of the selection process marks an important step in South Africa’s transition toward an open-access rail system,” Transnet Chief Executive Michelle Phillips said in Johannesburg on Wednesday. 

Phillips said agreements had already been signed with all 11 operators and discussions were underway to allow them to start using the rail network.

Rail crisis weighs on exports 

The reform comes after years of declining rail performance at Transnet, driven by equipment shortages, cable theft, vandalism, underinvestment and operational failures. 

Coal exports from South Africa recently fell to their lowest level in three decades, while iron ore shipments dropped to a 10-year low as freight rail constraints worsened. 

Mining groups including Glencore and Kumba Iron Ore have repeatedly warned about the cost of transport disruptions, with automotive and agricultural producers also hit by delays moving goods to ports. 

Under the new framework, private train operators will gain access to 41 rail routes and six major freight corridors used to transport coal, manganese, chrome, fuel and other export cargo. 

According to Transnet Rail Infrastructure Manager, the additional operators are expected to move about 20 million tons of freight a year from the 2026-27 financial year. 

South Africa currently transports roughly 165 million tons of freight annually by rail. The government wants that figure to rise to 250 million tons by 2029. 

Transport Minister Barbara Creecy said last month that market demand on the network is estimated at closer to 280 million tons a year.

Transnet said South Africa’s eight commercial seaports handled 304 million tons of cargo in the 2025-26 financial year, up 4.2% from the previous year. 

Transnet pushes broader recovery plan 

The state-owned group remains central to South Africa’s freight system, operating rail, port, and pipeline infrastructure through divisions that include Transnet Freight Rail, Transnet National Ports Authority, Transnet Port Terminals, Transnet Pipelines, Transnet Engineering, Transnet Rail Infrastructure Manager, and Transnet Property. 

Transnet Freight Rail, its largest operating unit, manages one of the continent’s most extensive freight rail systems, linking mining, agricultural, and industrial regions to domestic and export markets.

In recent weeks, Transnet secured a $352 million loan from France to help modernize ports, expand rail infrastructure and support cleaner logistics operations. 

The company has recently reported improved port performance, with vessel traffic rising 9% from a year earlier, offering early signs of recovery after years of operational setbacks.

Phillips, who became Transnet’s group chief executive in March 2024 after more than two decades at the company, has focused on improving operations and expanding partnerships with the private sector as the company works to rebuild confidence in the rail and port system.