Transnet plans to invest nearly R70bn over the next years on projects that directly support strategic commodity segments, coal, iron ore, containers, energy, manganese, chrome, magnetite and vehicles, as it moves towards its target of moving 250-million tonnes of rail freight per year by 2030.The state-owned group on Thursday reported its first profit in four years, with the freight and rail group R4.6bn in the black in the year ended March, from a R1.9bn loss in the previous year.The profit by Transnet is a boon for President Cyril Ramaphosa’s reform agenda, with the country’s two anchor companies, Eskom and Transnet, which have been a drag on economic growth for about a decade, showing signs of recovery.South Africa’s logistics sector is undergoing significant reform, including rail liberalisation, third party access, Transnet National Ports Authority corporatisation and increased private-sector participation (PSP).Transnet’s profitability was on the back of an increase in rail volumes to 167.9-million tonnes, supported by an increase in petroleum volumes and an improvement in corridor performance.Transnet said its R68.4bn planned outlay in the key segments was because the commodities were core revenue drivers and are critical to South Africa’s export competitiveness and industrial value chains.For the vehicle sector, which accounts for about 5% of the economy, Transnet said it will in the new financial year prioritise capacity recovery and operating model reform across vehicle corridors and ports by implementing a dual rail-channel export solution linking Gauteng with Durban, Gqeberha and KuGompo City.The group said it will also enable third-party rail participation through slot sales and operational leases to increase capacity and reliability in the vehicle sector.Transnet chair Sandile Sangqu in his annual letter, published in the group’s annual report, emphasised the importance of the PSP projects to the group’s future.“In the rail sector, reform is a necessity and an opportunity. Years of underinvestment and deferred maintenance have placed significant pressure on network performance, requiring substantial capital investment to restore reliability and capacity,” Sangqu said.“Our immediate priority is to stabilise critical high-density corridors while exploring concession opportunities for selected low-density lines.Read: Transnet breaks loss-making curse with R4.6bn profit“PSP is a central part of Transnet’s reform agenda. It is an important mechanism for unlocking investment, improving efficiency and supporting infrastructure development. During the year, Transnet advanced a structured pipeline of more than 10 strategic projects across ports, rail and energy.”One of the marquee PSP projects concluded by Transnet in the year under review is the 25-year contract with International Container Terminal Services (ICTSI) to operate Durban Container Terminal Pier 2 (DCT2), a centrepiece of the country’s most far-reaching logistics reforms in a generation.The Philippines-based ICTSI is expected to inject R11bn in investment in upgrading the container terminal and increase its capacity from 2-million to 2.8-million 20-foot equivalent units, representing a big lift for South Africa’s trade with the rest of the world.DCT2 is Transnet’s biggest container terminal, handling more than 65% of the Port of Durban’s throughput and 40% of South Africa’s port traffic.Transnet earlier this year kick-started a bidding process for Richards Bay Dry Bulk Terminal (RBDBT), inviting private sector partners to increase export capacity at the facility by 45%, boosting the fiscus.The terminal is one of South Africa’s largest and most strategic multicommodity dry bulk facilities, playing a critical role in supporting the export of commodities such as chrome, magnetite, coal, woodchips, chloride and alumina.Despite its strategic importance, the terminal’s performance has been constrained by ageing infrastructure, limited operational flexibility and rail bottlenecks on the Richards Bay corridor, all of which have restricted its ability to handle growing export demand efficiently. The terminal has an annual export capacity of 18.5-million tonnes (Mt), with plans to increase it to 26.9 Mt with a primary focus on chrome and magnetite, commodities that account for nearly 50% of the terminal’s existing export throughput.The two commodities have a robust long-term outlook due to global trends in steel production, stainless-steel consumption and the transition toward low-carbon, green steel manufacturing.The group has also opened the door for 11 private sector companies to have access to the country’s vast rail network.The company said the request for proposal for the Ngqura Manganese Export Corridor will be issued to the market by end-July next year.Transnet CEO Michelle Phillips said the establishment of the Transnet Rail Infrastructure Manager (TRIM) has gone far in speeding up reforms in the rail sector.“The establishment and operationalisation of TRIM has turned structural reform into an operational reality. Significant progress is demonstrated through the roll-out of slot allocation mechanisms,” Phillips said. “With 41 routes across six corridors allocated to prospective operators, the foundations of a more inclusive and competitive rail network are now taking clear and tangible shape. This is a defining milestone that represents a transition toward a modern rail system in which infrastructure and operations are managed separately.”Business Day